Daily Market Report - 19/01/2016

GBP

In the UK we had further bad news for the Steel industry as Tata Steel announced that they were going to cut over 1000 jobs here in the UK. This is amid falling steel and commodity prices. However this will most likely not have an effect on the wider economy as unemployment is low.

The FTSE had a bad day yesterday however it has so far managed to fend off falling into the bear trap, trading around 19 per cent off its all-time high of 7,103 in April last year. A key measure of a bear market is an index trading 20 per cent lower than its peak. This fueled fears that this we might be entering a bear market.

CNH

China’s economy grew at its slowest rate in a quarter of a century in 2015, increasing pressure on Beijing to address fears of a prolonged slowdown and ease the jitters affecting global markets. Full-year growth of 6.9% was only just short of government expectations of 7% but by contrast, growth in 2014 stood at 7.3%

The national bureau of statistics’ bulletin showed GDP growth at 6.8% in the three months to December, easing from 6.9% in the previous quarter – the slowest quarterly rate since 2009, when growth slowed to 6.2%.

EUR

French President Francois Hollande has declared that France was in a state of Economic emergency, with unemployment at 10.6%. Hollande will introduce a €2bn job creation plan. Under a two-year scheme, firms with fewer than 250 staff will get subsidies if they take on a young or unemployed person for six months or more. This shows that the French economy is in a potentially dangerous position, with high unemployment and public debt, with France being one of the EU’s biggest economies this could cause worry in financial markets.

Key Announcements

GBP - 09:30 :Consumer Price Index (YoY Dec) expected to rise to 0.2% from 0.1%
GER- 10:00: ZEW Survey – Economic Sentiment (Jan) Expected to fall to 9.0 from 16.
GBP - 11:00: BoE Governor Mark Carney Speech.
EUR- 12:30 : Eurozone CPI (YoY Dec) expected to remain unchanged at 0.2%.