On 7 April, 2015 – European markets rose on strong eurozone investor confidence data

Shares advanced in the Asia Pacific region and in Europe. However, US stocks retreated just prior to the market close to finish down slightly.
United States
Early gains for US stocks fizzled in late afternoon trading, leaving indices slightly lower at the closing bell. The S&P lost 0.2%, Nasdaq slipped 0.1% and the Dow Jones industrials (down 5.43 points) were virtually unchanged on the day.
FedEx said Tuesday that it had agreed to acquire the Dutch delivery company TNT Express in a US$4.8 billion deal that would greatly expand the company’s presence in Europe. The all-cash deal would give FedEx access to TNT’s extensive road delivery network and create what the companies said would be a third strong player to compete in Europe with DHL Express of Germany and United Parcel Service. Viacom retreated after the entertainment company announced layoffs and a big charge to earnings as part of a restructuring effort. Berkshire Hathaway plans to take a nearly 10% stake in Axalta Coating Systems, which makes specialized coatings for cars and trucks. Berkshire is buying 20 million shares from the Carlyle Group, a private equity firm.
Earnings season unofficially kicks off when Alcoa reports quarterly results after markets in the US close on Wednesday. Alexion Pharmaceuticals, Vertex Pharmaceuticals and Biogen advanced. Informatica rallied after it agreed to be bought by private equity firm Permira and Canada Pension Plan Investment Board for about US$5.3 billion. Clovis Oncology jumped after saying US regulators designated its rucaparib drug as a breakthrough therapy to treat advanced ovarian cancer. American Express was down on a broker downgrade.
Gold at the afternoon London fixing was up US$12.50 to US$1,211.00. Copper futures were up 1.4% to US$2.75. WTI spot crude was up US$1.62 to US$53.76. Dated Brent spot crude was up 89 US cents to US$59.01. The US dollar was up against the euro, yen, pound, Swiss franc and the Canadian dollar. However, it declined against the Australian dollar. The Dollar Index was up 1.1%. The yield on US Treasury 30 year bond was down 4 basis points to 2.52% while the yield on the 10 year note slipped 2 basis points to 1.88%.
Europe
The European markets returned Tuesday following a four day weekend for the Easter holiday. Eurozone investor confidence data rose to the highest level in nearly seven-and-a-half years in April. The weaker than expected US jobs report for March, which was released Friday, also drove the markets sharply to the upside. Investors are optimistic that the Federal Reserve may delay its planned increase in interest rates due to the weak data. The FTSE jumped 1.9%, the CAC added 1.5%, the DAX gained 1.3% and the SMI was 1.4% higher.
Investors continue to monitor the situation in Greece. The Greek repayment deadline to International Monetary Fund is on April 9th, while a deal to secure funding from Eurozone creditors appears weeks away. The country is due to repay an IMF installment of €460 million on Thursday followed by its social security bill on April 14. After a meeting in Washington with IMF officials, Greek finance minister Yanis Varoufakis said that Greece “intends to meet all obligations to all its creditors, ad infinitum.”
Deutsche Lufthansa, Air France-KLM and International Consolidated Airlines Group retreated on broker downgrades. RWE and E.ON advanced. Vivendi increased after the company confirmed that it wants to acquire Dailymotion, a video streaming website. Dailymotion is currently owned by Orange. Technip and Total were up. Shire climbed after the drug maker said it has reached an agreement with the US FDA on a clear regulatory path for SHP465, an investigational oral stimulant medication being evaluated as a potential treatment for Attention-Deficit/Hyperactivity Disorder in adults. Marks & Spencer was up on a broker upgrade. BG Group and Royal Dutch Shell gained as did Rio Tinto and Glencore. TNT Express surged in Amsterdam after the troubled logistics firm agreed to be taken over by FedEx. Royal Mail was up tracking a surge by TNT after FedEx made a €4.4 billion takeover offer.
Asia Pacific
Stocks were up broadly Tuesday, tracking overnight gains on US markets as oil prices rebounded and worries about the timing of a Federal Reserve interest rate increase eased. The yen weakened and Chinese stocks surged to fresh seven year highs on stimulus hopes, helping bring back positive sentiment as investors returned from the Easter holiday break.
The Shanghai Composite soared 2.5%. Banks advanced with Bank of China and Agricultural Bank of China gaining after China relaxed rules for the sale of asset backed securities. The Hang Seng stock market was closed for a holiday.
The Nikkei was up 1.3% to near a two week high with sentiment underpinned by Monday’s rally in the US and a weaker yen. Energy stocks Inpex and JX Holdings advanced after oil prices surged to their biggest gain in nearly two months. Mitsubishi UFJ Financial Group, Sumitomo Mitsui Financial and Mizuho Financial were up.
The S&P/ASX and All Ordinaries were up 0.5% and 0.4% respectively. Both indices pared early gains after the Reserve Bank of Australia left its cash rate unchanged at a record low of 2.25%, disappointing some who had expected the cash rate to be cut to 2.00%. However, policymakers said further easing may be appropriate over the period ahead in order to foster sustainable growth in demand and inflation consistent with the RBA’s target. February retail sales were up for a third month, this time by a greater than expected 0.7% on the month.
The Kospi was virtually unchanged, inching up just 0.6 point. The Sensex also was virtually unchanged after the Reserve Bank of India left its policy interest rates unchanged. The RBI kept its repo rate at 7.50% and the reverse repo rate at 6.50%. The cash reserve ratio was also kept unchanged at 4.00%, disappointing some investors who had expected the RBI to inject more funds into the financial system in order to put pressure on banks to lower their lending rates.
Global Stock Market Recap

Please remember, the value of investments and the income from them can do down as well as up. Funds that invest in overseas markets may be subject to currency fluctuations. Investments in small and emerging markets can be more volatile than other overseas markets. Reference in this document to specific securities should not be construed as a recommendation to buy or sell these securities, but is included for the purposes of illustration only.
Looking forward*
Bank of Japan announces its monetary policy decision. Germany posts February manufacturing orders. France releases February merchandise trade data. The Eurozone reports February retail sales. The Federal Reserve publishes the minutes from the March 17 and 18 FOMC meeting.
*Note — all releases are listed in local time.
Anne D PickerChief EconomistEconoday