Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Market nerves to be tested today

09.36 AEDT, Tuesday 26 February 2013

Market nerves to be tested today
By Ric Spooner (Chief Market Analyst, CMC Markets)

At this stage, the first of this week’s major risk events looks like a clear negative for investors. The rally in share markets in recent months has been mainly about investor preparedness to pay more for stocks given perceptions of a lower global risk environment. While it’s unlikely that the Italian election result will lead to any immediate change in economic policy, it will lead to uncertainty and reduced confidence.

The Italian election results demonstrate that politicians don’t have a clear mandate for economic reform. While there is no immediate prospect of change to the pro Euro policies of the Monti government, this lack of mandate will increase the medium term political risk both for Italy and the Eurozone in the eyes of international investors. In the shorter term, the uncertainty created by the possibility of an interim government and further elections is a potential negative both for markets and for consumer and business confidence within Italy.

While the Australian market will open weaker this morning, it would take a clear move below support at 4950 to provide conclusive technical evidence that the medium term uptrend in the S&P/ASX 200 index is breaking down. Given the medium term nature of the risks from the Italian election and the possibility of positive news both from Mr Bernanke’s testimony and US budget negotiations still to come, investors may be cautious about selling too aggressively at this stage.


http://www.cmcmarkets.com/


© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Auckland Port Study: Port To Ship Out – No Departure Date

Interest groups in Auckland and its waterfront chose a group of representatives to determine the future of the port. Their consensus is that the Port is going to have to move but not before a credible location is confirmed... More>>

ALSO:

Tax: GST Threshold For Online Purchases Won't Lower Before 2018

The government wants to lower the threshold on online purchases which qualify for GST from mid-2018, but says more work is needed and there will be no change without public consultation. More>>

ALSO:

North Canterbury: Government Extends Drought Classification

The government has extended a drought classification for the eastern South Island until the end of the year, meaning the area will have officially been in drought for almost two years, the longest period for such a category. More>>

ALSO:

Negotiations Fail: Christchurch Convention Centre Build To Proceed Without PCNZ

After protracted negotiations, the government has ditched the construction consortium it picked to build Christchurch's replacement convention centre, which it now anticipates delivering at least two years behind the original schedule. More>>

ALSO:

Other Centres' Convention Centres:

Ruataniwha: Greenpeace Launches Legal Challenge Against $1b Dam Plan

Greenpeace NZ is launching a legal challenge against a controversial plan to build a dam that’s set to cost close to $1 billion and will pollute a region’s rivers. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news