The Markets Last Week:

Last week mergers and acquisitions among natural resources firms were the key drivers of market movements.

KNOC has launched a hostile bid for Dana petroleum, while Vedanta’s move to takeover the Indian arm of Cairn energy has weighed on the miner. Though it retraced to the 220 mark mid-week, it has come back down to 6-month lows, as investors remain unwilling to support the move.

Likewise, BHP Billiton’s $39 billion cash bid for the out-of-favour Potash, an attempt to arbitrage the deflation trade, has further nauseated investors in these choppy conditions, and the share has lost over 9% since the announcement.

Potash is seen desperately seeking new global partners. Other miners remain down amid uncertainty ahead of Australia’s general election.

Macroeconomic data continue to point towards the possibility of a double-dip recession in the states, as the Philadelphia Fed announced Thursday that mid-Atlantic industrial production was down far worse than expected, while US PPI for July was only +0.2%, as expected.

Despite better than expected July retail sales from the UK, sterling remains weak and cable has fallen, with the JPY retaining its ‘safe-haven’ status for the time being.

The Markets This Week:

Next Monday will see Petrofac and Bovis Homes making announcements. Cairn, Antofagasta and Fortune Oil all make interim statements on Tuesday.
Wednesday holds a statement from Tullow Oil and US Durable Goods Orders, and both Petropavlovsk and Salamander Energy report on Thursday. US GDP comes on Friday, with the potential to seriously sway markets.

Article by Spreadex.

CFDs, Forex and Financial Spread Trading carry a high level of risk to your capital and can result in losses larger than your initial stake/deposit. These forms of trading may not be suitable for everyone so please ensure you fully understand the risks involved. Where necessary, seek independent financial advice.

This BillionforGovernor.com is only intended for those persons of 18 years of age or older.