KBC Market Research Desk
KBC Bank
Around noon, when Bloomberg services had been restored, European shares dropped sharply lower, due to worries regarding the Chinese stock market. European stocks trade currently with losses of up to 2%. In the US, Equities opened lower too, but losses are more contained (‐1%).
Pierre Moscovici, the European Commissioner for economic and financial affairs, said today there was little chance of a deal with Greece next week and set the mid‐May meeting of the Eurogroup as a decisive moment for the country. He called on Greece to speed up concrete technical discussions and insisted there is no plan B.
China’s securities regulator issued today a strong warning about the country’s soaring stock markets and tightened rules on margin lending. In addition, the country’s two stock exchanges said they would make it easier to bet against stocks. The announcement came however after the close of Chinese markets.
Michigan consumer confidence came out very strong with the headline index jumping to 95.9 in April from 93 previously. Inflation expectations went down though to 2.5% from 3% for the 1‐year ahead and to 2.6% from 2.8% for the 5‐year ahead expectations.
The Bank of Italy said today that the Italian economy probably posted modest economic growth in the first quarter of the year, raising expectations that the country is emerging from three years of recession. The Bank of Italy added that the ECB bond buying programme can raise Italian inflation by more than 0.5 percentage points in both 2015 and 2016.
Later today and tomorrow, the IMF and World Bank meetings in Washington will continue with still several interesting speeches on the agenda, including one of ECB President Draghi
This non-exhaustive information is based on short-term forecasts for expected developments on the financial markets. KBC Bank cannot guarantee that these forecasts will materialize and cannot be held liable in any way for direct or consequential loss arising from any use of this document or its content. The document is not intended as personalized investment advice and does not constitute a recommendation to buy, sell or hold investments described herein. Although information has been obtained from and is based upon sources KBC believes to be reliable, KBC does not guarantee the accuracy of this information, which may be incomplete or condensed. All opinions and estimates constitute a KBC judgment as of the data of the report and are subject to change without notice.
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