On 23 April, 2015 – Most European markets slid on indications of an unexpected slowdown

Stock indices were mixed in Europe and the Asia Pacific. However, they advanced in the US with the Nasdaq closing at its highest since March 2000.
United States
Stocks advanced despite mixed earnings reports from General Motors, Proctor & Gamble and others. Shortly before noon, the Nasdaq traded briefly above its previous closing high of 5,048.62 from March 2000. It pulled back slightly, and then surged ahead again. The Dow Jones industrials were up 0.1%, the S&P added 0.2% and Nasdaq advanced 0.4%. Energy stocks were among the biggest gainers as the price of oil rose.
Several export-heavy companies reported their results Thursday. All of them said the strong US dollar hurt results. Two of the companies were Procter & Gamble and 3M. Earnings at P&G were down roughly 8% from a year earlier, largely because of the US dollar, which makes its products more expensive when sold abroad. 3M also reported lower profits because of the dollar. Caterpillar reported a better than expected profit for last quarter, it said it may face bigger issues later this year as long as the dollar remains strong. Microsoft reported revenue and profit above expectations, as sales of its hardware and cloud-computing products helped to offset a decline in its core Windows business.
General Motors posted a smaller than expected quarterly profit on weakness in South America and Russia and a higher tax rate. First quarter net income climbed to US$945 million or 56 US cents per share from US$125 million or 6 US cents per share a year earlier. Revenue fell 4.5% to US$35.7 billion.
Google’s first quarter revenue jumped 12%, helped by an 11% increase in ad sales. Consolidated revenue rose to US$17.26 billion for the quarter ended March 31 from US$15.42 billion a year earlier. Net income rose to US$3.59 billion or US$5.20 per share from US$3.45 billion or US$5.04 per share.
Amazon.com’s quarterly revenue was up 15%, helped by higher revenue from North America and its cloud computing services unit. The company reported a loss of US$57 million or 12 US cents per share for the first quarter ended March 31 compared with a profit of US$108 million or US 23 cents per share a year earlier. Revenue rose to US$22.7 billion from US$19.74 billion.
First-time claims for U.S. unemployment benefits unexpectedly increased 1,000 in the week ended April 18th to 295,000 from the previous week’s unrevised level of 294,000. After reporting a notable increase in new home sales in previous months, sales declined 11.4% to an annual rate of 481,000 after jumping 5.6% to a revised rate of 543,000 in February.
Gold at the afternoon London fixing was down US$3.50 to US$1,185.75. Copper futures were up 0.9% to US$2.70. WTI spot crude was up US$1.36 to US$57.52. Dated Brent spot crude was up US$2.15 to US$64.88. The US dollar was down against all of its major counterparts including the euro, yen, pound, Swiss franc and the Canadian and Australian dollars. The Dollar Index was down 1.0%. The yields on both the US Treasury 30 year bond and 10 year note were down 3 basis points to 2.64% and 1.95% respectively. 
Europe
Most markets were lower Thursday, dragged down by a series of flash purchasing manager surveys that indicated an unexpected slowdown in April. Investors were looking forward to Friday’s meeting of Eurozone officials in Latvia. However, a breakthrough in the negotiations on Greece currently appears unlikely. The FTSE added 0.4% but the CAC, DAX and SMI were down 0.6%, 1.2% and 0.2% respectively.
Daimler declined after company’s Mercedes-Benz was been fined 350 million yuan (US$56.49 million) by a Chinese pricing regulator for violating anti-monopoly laws and price fixing of vehicles. Deutsche Bank finished lower after the lender said it would be profitable in the first quarter and will report near record revenues after setting aside €1.5 billion for litigation costs. Fresenius and Fresenius Medical Care were down.
Renault reported first quarter revenues of €9.39 billion, up from 13.7% from €8.26 billion last year. Automotive segment sales rose 14.3% to €8.83 billion while sales financing rose 5.5% to €559 million. Renault revised its 2015 outlook for the European automotive market and now forecasts a full year growth of 5%. Both Peugeot and Renault declined but Michelin advanced.
WPP dropped after the advertising company maintained its guidance for the full year despite slowing sales growth last quarter. Taylor Wimpey gained after it provided a trading update. Antofagasta increased after it agreed to sell its water utility business. Anglo American advanced after the company announced that it will cut diamond production this year. Novartis climbed in Zurich after posting better than expected first quarter earnings. The company also confirmed its guidance for operating earnings and sales growth for the year.
Markit’s composite purchasing managers’ index — a measure of activity in the manufacturing and services sectors — for the region slid to 53.5 in April from 54.0 in March, against expectations of a slight increase to 54.4. Services and manufacturing both slowed, as did activity in France and Germany. UK retail sales declined for the first time in six months in March on petrol sales. Retail sales including auto fuel unexpectedly dropped 0.5% on a monthly basis in March, reversing a 0.6% rise in February.
Asia Pacific
Most markets advanced Thursday with Chinese and Japanese shares hitting fresh multi-year highs as investors shrugged off a weak Chinese manufacturing PMI on expectations of additional stimulus.
The Shanghai Composite hit a fresh seven year high as weaker than expected factory activity data reinforced expectations that Beijing will further ease its policy on fiscal and monetary sides to combat the downturn. The index was up 0.4% while the Hang Seng slid 0.4%. The April flash manufacturing PMI declined to a 12-month low, underscoring deepening weakness in the economy. The PMI’s reading was 49.2, down from March’s final reading of 49.6.
The Nikkei added 0.3% on corporate earnings optimism. The April flash manufacturing PMI retreated in Japan as well. The April reading was 49.7, down from the March final 50.3. A reading below 50 indicates contraction. Nomura Holdings, Daiwa Securities, Nippon Yusen KK and Kawasaki Kisen Kaisha jumped. Japan Tobacco advanced on a broker upgrade. Sony retreated, giving up early gains after the consumer electronics firm raised its profit forecasts for its latest fiscal year ended March 31, 2015. Panasonic, Nikon and Sharp rallied on the weaker yen.
Both the S&P/ASX and All Ordinaries inched up 0.1%. Miners led the gainers after iron ore prices rallied overnight. BHP Billiton, Rio Tinto and Fortescue Metals advanced. The big four banks declined after inflation data suggested an interest rate cut was not imminent. The Kospi jumped 1.4% on foreign fund buying as weak GDP data fuelled calls for more stimulus to bolster economic growth. The Sensex lost 0.6%.

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*
April Ifo survey will be released in Germany and March durable goods orders will be posted in the US. ECOFIN meets in Riga, Latvia. 
*Note — all releases are listed in local time.