Overseas Economic News
Not as much to report on this week.
Sadly in Greece there is little to report on in terms of resolution to the seemingly interminable talks between the Greek government and its lenders. Fortunately, the Greeks DID manage to make the e200m payment due to the IMF on Wednesday, and the European Central Bank (ECB) continues to float the Greek banking system. But all of this can stop instantly should a long-standing reform agreement fail to arise.
Ugh. More of the same.
The early exit polls from the UK election overnight seem to suggest the Conservatives will retain power by way of minority government again. Markets will like this news.
Perhaps of most importance to us and to markets in general is that a Conservative victory allows PM David Cameron to press on for his planned referendum on membership of the European Union by the end of 2017. This will be a fascinating situation to watch, and surely another cause for uncertainty in the medium term.
China took a hit this week after its stellar rise, so perhaps we shouldn’t be surprised. There was no obvious reason for the fall, much of which occurred Wednesday in one fell swoop.
Lastly, in the US economic data continued to demonstrate strength in consumption. The April services sector survey showed more gains, as did the ADP Employment figures.
Bond yields continue to ratchet higher in the US which is a negative drag on equities there, as it is the world over and in Australia as discussed.