Monthly Market Report - May 2017
20th April 2017
With commentary from David Stevenson
initial inspection everything within the strange world of investment looks
really rather optimistic. Most key economic indicators suggest acceleration in
global growth, even in the manufacturing sector. Crucially this optimism is
evenly spread about, with the Eurozone and China both looking like they might
be slowly catching up with the recent pace of growth on display in the US. A
good summary of this cheery world view comes via a recent note from analysts at
Barclays who run their own macro measures looking at confidence levels,
especially in manufacturing. It’s been edging up steadily for the last three
months although the very latest measure in March did edge down slightly.
Overall though this index still remains at an elevated level
historically, with the most recent reading the second highest since May 2011.
The Barclay’s analysts observe that manufacturing sentiment continues to be
underpinned by "buoyant demand - both domestic and external. …global
manufacturing sentiment remains solid at the end of Q1” although cost concerns are
beginning to build. So, all in all then a decent picture emerges from this one
after a bullish few months stock markets have stopped bounding forward, with
the FTSE 100 becalmed well below the symbolic 7500 level while the benchmark US
index, the S&P 500, also appears to be stuck below the 2500 level. We are, one suspects, at one of those key
inflection points in which the next move up or down will likely set the tone
for markets over the next 12 months.
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