A brief look at last week and the week ahead, the Weekly Review from IG Index.
Weekly Trading Report 31 May 2010 - Last Week's Trading Highlights
Global markets enjoyed a rollercoaster ride last week, with the central focus once again on financial instability in the Eurozone.
The FTSE 100 plunged 129 points (-2.54%) to an eight-month low of 4940.68 on Tuesday, with German and French indices falling by a similar proportion.
The sharp fall meant the UK's blue-chip index had slumped 10% since attaining a 22-month high at 5753.85 on 26 April.
The latest wave of panic emerged from Spain, where the debt-laden bank Cajasur was rescued by the Spanish government after accruing some €445 billion of housing-related bad debt. Exacerbating matters, on Monday the IMF said the Spanish economy must overcome 'severe' challenges to recover.
The latest Eurozone problems also affected the Euro's value, which fell 0.8% to $1.228 against the Dollar, and £0.855 against Sterling, on Tuesday. Also adding fuel to the fire last week was a rise in tensions between North and South Korea, which further knocked confidence.
On Wednesday however, markets started to rebound, and the UK's blue-chip index added 197 points (+2%) to climb back through 5000, before gaining another 157 points (+3.1%) to close at 5195.17 on Thursday. The Dow also climbed almost 3% on Thursday, after a Chinese reassurance that it would continue to purchase Eurozone bonds.
Though it had little effect on Tuesday's London markets, there was some positive news from the ONS, with confirmation that the UK economy grew slightly stronger than initial estimates in the first quarter, at 0.3%.
The revised figure was attributed to faster-than-expected growth in industrial and manufacturing output in March. Meanwhile on Tuesday, Marks and Spencer reported a 4.6% rise in annual pre-tax profit to £632.5 million, up from £604.4 million a year ago, and the last announcement under outgoing Chairman Sir Stuart Rose.
Thursday's CBI retail sales survey however, which showed May's high street sales slipped to a 14-month low, underlined a cautionary outlook for retailers.
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Weekly Trading Report 31 May 2010 - The Week Ahead
Indicators
The coming week sees a raft of employment and manufacturing data released globally including the all-important Non-Farm payrolls in the US on Friday.
Tuesday and Thursday see the bulk of the week's labour and manufacturing data released, including PMI indicators and unemployment rates for several Eurozone countries.
Investors concerned about Europe's debt situation will be keeping a keen eye out for these, as well as the region's sentiment surveys on Monday and its GDP figures on Friday morning.
Company Results and Reports
It's a light week for company news, with few significant announcements scheduled across the Atlantic.
In the UK, Northern Foods releases year-end results on Tuesday, while on Thursday keep any eye out for announcements from B&Q owner Kingfisher and supermarket chain Morrisons.
The week closes with annual numbers from the iconic model railway firm Hornby on Friday.
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For previous weeks see below.
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'Financial Spread Betting 31 May 2010', Review by D. Jones, last update: 31-May-10
Risk Warning:
Spread Betting carries a high level of risk
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it may not be suitable for all investors. Ensure you only
speculate with money that you can afford to lose and that you fully
understand the risks involved and seek independent financial advice where necessary.
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