By: Mike Campbell
London and other major markets around the world have decided to greet the New Year with optimism, pushing markets to levels not seen for close on a year and a half. The FTSE index closed at 5500, a sixteen month high. The partially nationalised RBS banking group did particularly well, closing up about 10% on sentiment that it would out perform its own expectations. The Nikkei managed to coast to levels not seen for fifteen months and oil breached the $80 mark before falling back slightly. The rise in the oil price boosted stocks in the major petrochemical companies. Sentiment was buoyed by upbeat data coming from many quarters: UK manufacturing returned the fastest pace of growth in two years whilst data from China suggested it had achieved its best growth in five years. Manufacturing data from the US also suggested the best level of growth seen for three years according to the Institute for Supply Management. So, 2010 is off to an up-beat start. It remains to be seen if the current level of optimism will be sustained as the year grows in maturity. There is still the pesky little question of unwinding all those expensive little stimulus packages.
Chief Financial Officers Are Confident
To maintain the upbeat nature of this first post of 2010, let’s focus on the perspectives of UK CFOs. CFOs are at their most confident for two years and have (partially!) regained their appetite for risk. 80% of them believe that the UK financial sector is well placed to support a financial recovery in the coming year. The UK is widely expected to emerge from its worst economic recession of six successive quarters when data is released for Q4 2009.
Upbeat New Year Sentiment Pushes FTSE To 16 Month High
DailyForex.com