The great pause, which we have seen in global equity markets over much of February, appears to be over. Markets are breaking out to the upside.
That started with strength in the US into the close on Friday, with that strength continuing in Asian trading earlier today. Asian markets are also following – the Nikkei in Japan for example is up 2 per cent today (after its recent sideways phase). Weight of money is clearly, in part, what’s driving that upward momentum, with record strong inflows into global equity funds ($58bn last week according to EPFR).
The calendar of events is fairly light today, with the US closed for Presidents’ Day holiday. Over the course of this week, though there are various themes on the calendar: That includes flash PMI data on Friday from across the global economy, which will give some early insight into the strength of February’s global economic activity; US & UK retail sales (Wednesday & Friday, respectively) which will provide some insight into the US/UK consumer; while the meeting minutes from the Recent ECB and Fed meetings are also published.