Geopolitical tension overshadows positive economic news
Developments in the Arab world contributed to a rocky ride for share prices this week. Early in the week, the crisis in Libya resulted in declines for most global equity markets. Mid-week, crude reached its highest level in two and a half years as a result of fears that Libya tensions would threaten supplies, and share prices declined on concerns about how businesses and the economy would cope with surging oil prices. Wall Street’s S&P 500 Index experienced its worst one-day fall since August.
However, as the week progressed, the issues were not as pronounced as market participants feared. Oil prices then moved lower, and major global markets saw solid gains on Friday.
There was also good news, particularly for the U.S. economic recovery. Two separate surveys indicated that American consumers are more confident than at any time in the last three years. There were signs of job market improvement as unemployment claims fell.
The strength of Canadian corporate earnings was confirmed by Statistics Canada. The agency reported that operating profits advanced 7.9% in the fourth quarter of 2010 compared with the previous quarter, and by 9% y-o-y. That strength continued this week, as banks reported better than expected profits.
“Safe haven” investments attracted funds amid geopolitical turmoil. Government bonds, particularly U.S. Treasuries, and gold benefitted from a continued flight from riskier assets.
For a look at the week ahead go to :
http://investorsgroup.com/consult/terry.pitz/english/cnf_frameset.asp?pg=/English/prodServices/marketCom/default.shtml
Developments in the Arab world contributed to a rocky ride for share prices this week. Early in the week, the crisis in Libya resulted in declines for most global equity markets. Mid-week, crude reached its highest level in two and a half years as a result of fears that Libya tensions would threaten supplies, and share prices declined on concerns about how businesses and the economy would cope with surging oil prices. Wall Street’s S&P 500 Index experienced its worst one-day fall since August.
However, as the week progressed, the issues were not as pronounced as market participants feared. Oil prices then moved lower, and major global markets saw solid gains on Friday.
There was also good news, particularly for the U.S. economic recovery. Two separate surveys indicated that American consumers are more confident than at any time in the last three years. There were signs of job market improvement as unemployment claims fell.
The strength of Canadian corporate earnings was confirmed by Statistics Canada. The agency reported that operating profits advanced 7.9% in the fourth quarter of 2010 compared with the previous quarter, and by 9% y-o-y. That strength continued this week, as banks reported better than expected profits.
“Safe haven” investments attracted funds amid geopolitical turmoil. Government bonds, particularly U.S. Treasuries, and gold benefitted from a continued flight from riskier assets.
For a look at the week ahead go to :
http://investorsgroup.com/consult/terry.pitz/english/cnf_frameset.asp?pg=/English/prodServices/marketCom/default.shtml
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