Greece pushes Europe lower
In Europe the FTSEurofirst lost two percent in a week marked by uncertainty surrounding Greece's negotiations with its international lenders ahead of a payment deadline for Athens looming next week. Greece's government intends to reach an agreement on a cash-for-reforms deal by Sunday, its spokesman said on Thursday, even as euro zone officials suggested a deal was far from imminent. The index is still up around 1.7 percent for the month. The lack of clarity on the outcome meant some traders were reluctant to make strong bets on future market directions.
In the US a month that began with investors blindsided by a global rout in sovereign debt and a selloff in high-flying equities ended with stocks near all-time highs. The Standard & Poor’s 500 Index climbed 1.1 percent in May, historically the secondworst month for American equities. Treasuries capped the period with their first weekly gain since April 17, while the dollar rebounded 2.3 percent in May after halting a string of nine straight advances.
Stocks rose as data indicated the economy was settling into a moderate pace of growth after a firstquarter slump, with the Federal Reserve signaling any increase in borrowing costs would be shallow and gradual. Equities also got a boost from a surprise gain in profits and a record $214 billion of announced acquisitions.
Chinese shares posted their first weekly decline in three weeks after brokerages tightened marginlending rules. Record growth in margin debt helped fuel a 126 percent gain in the equity gauge over the past 12 months.
The MSCI Emerging Markets Index has slumped 3.7 percent this month as more positive U.S. data boosted the odds for the Federal Reserve to raise interest rates soon, dimming the appeal of riskier assets. Fed Chair Janet Yellen said last week borrowing costs will be increased this year.
Representatives of OPEC member states confirmed the group’s prior outlook for the oil market in 2015, projecting that the need for its crude will rise in the second half of the year.
This article was compiled by Valletta Fund Management Limited, a member of the BOV Group.Valletta Fund Management,TG Complex, Suite 2, Level 3, Brewery Str., Mriehel BKR 3000 Freephone: 80072344. E-mail: infovfm@bov.com. Website: www.vfm.com.mt. Valletta Fund Management Limited is licensed by the MFSA.