Mithril Asset management - Weekly Bulletin presented by Square Mile Financial Services
Finance News - Weekly Bulletin 13th of August 2012
**We wish to point out that Mithril Asset Management, Mauritius has no affiliation whatsoever with Mithril Capital Management**
It was another week of broad market gains. It’s now the fifth consecutive week of upside as US markets in particular, headed back to their highest levels for the year.
The end of the week saw matters halt somewhat, after China trade data disappointed. Global stock markets, along with commodities, fell Friday after China reported that exports rose just 1% from the year-ago period, and imports rose 4.7%, against very high expectations for gains of 8% and 7%, respectively. Quite worryingly, data from the previous day pointed to deflation in a country that is increasingly being relied upon to pull the global economy out of its slump.
This is likely to play into the hands of those looking for further easing to add to the rate cuts from last month. Indeed should China cut rates further, it will be the 3rd rate cut in a matter of weeks and, quite pertinently, the first time China has budged at all on its interest rate policy since the lows of the financial crisis in 2009.
As suggested last week, the current mood remains sensitive. Western indices are at high levels and as such will be prone to profit taking at the sniff of bad news.
In truth, Europe has advanced little and much of the positive movement of recent weeks has been based on words or promises from those with the power to influence. What we will require is either measures or data to support that we still remain on the right lines.