Financial Betting Articles

Macro Macro Man!

Last week the markets saw a lot of whirling and twirling but as predicted by yours truly, no decisive move as yet. For those of you who like to top and tail the indices (I know who you are) you were in seventh heaven! Those of you who bought Wall Street to rise 100 ticks on Wednesday, when it was down over 50 with 40 minutes to go must be taking delivery of your flash red Lamborghinis about now. You FX boffins were also grinning with glee as the currency pairs were all over the shop.

The markets are stuck in a tug of war - the micro economic picture is rosy, while the macro looks glummer than the NatWest three right now. In the States, the market has been buoyed by healthy profits at frivolous firms like Nokia, Starbucks and Disney. Over here, serious companies like Royal Bank of Scotland, BA and Anglo American mining have led the charge.

But the credit crunch is like an egg stain on your jeans - you can lick it, but it just won't go away. US mortgage firm Accredited Home Lenders has got the colley-wobbles and Germany lender IKB Deutsche Industriebank has to be propped up by their Government. But the impact is being felt much further a field. An estimated $43 billion of bond and loan offerings have been suspended in the past two weeks. And it gets worse.

UK insolvencies last quarter were up 4.2% on the same period last year. US unemployment rose to the highest level since the start of the year and their consumer and housing data look worrying. UK house prices rose only 0.7% in July - the fourth month where prices rose less than 1%. House repossessions are on the rise too. Just as well UK interest rates remained at 5.75% last week.

Regardless of the bigger picture, individual companies seem to be doing just fine at the moment. Two notes of caution though - one, US consumers need to keep spending to keep their economy out of recession. Tuesday's consumer credit data at 8pm may well shift the market as it gives a clue to future US consumer spending patterns.

Two, the exposure of banks to the debt squeeze isn't completely clear and a banking crisis is seriously bad news. The complexity of new debt instruments means any problems may take a while to unwind. But with banks like HSBC and RBS reporting good returns perhaps this is the best time for them to feel the squeeze.

So while the wider economic indicators look a bit iffy, firms are getting on with the business of making money. Do the markets need to get a grip? Get on with YOUR business and make money with ChoiceOdds...

The DOW took 60 trading days to get from 13,000 to 14,000 but only 16 to fall back to almost that level.

Despite trading in a 174.9 tick range, the FTSE ended up only 9.1 ticks last week.

Volatility is clearly on the rise - the average daily range for the DOW in July was 245.42 ticks, compared to 208.29 in June and 183.56 in May.

43 British children every year are permanently disfigured pulling faces when the wind changes.

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