Earnings & China data lift stocks
Heading into the close, the FTSE 100 is ten points lower, while US markets await the release of Fed minutes.
Equities are finishing the week on a stronger note, as Chinese data points to stimulus and US banks start reporting season in the right way.
- China throws the kitchen sink at the economy
- Pound lifted on Brexit talks news
- Banks kick off earnings season by beating earnings forecasts
Equities have been relentlessly positive all day, with the session having started off on the front foot thanks to Chinese credit growth, which rose 10.7% over the year to hit a sum equivalent to 9% of the country’s GDP. This is stimulus undertaken in the style of ‘shock and awe’, and certainly puts the ECB’s miserly TLTROs into the shade. The sense that the Chinese government has stepped up to the plate and delivered a hefty dose of liquidity encouraged investors from the opening bell, with US markets taking up the positive theme this afternoon. GBPUSD is making another attempt to break $1.3120, the highs from earlier in the week, as the shadow chancellor causes hope to rise with a comment
that talks between the two parties are going well. But there has been precious little sign of any real progress, leaving the UK almost exactly where it has been for the past six months, if not three years.
Earnings season has begun in the right fashion thanks to JPMorgan and Wells Fargo, and having braced themselves for some tough figures it is entirely possible that investors will find reasons for optimism in the weeks to come. Even a year-on-year decline may not be the end of the world, if it is not too severe, but a flurry of disappointment might well test the bullish momentum that has been almost universally triumphant since late December.
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