On 18 May, 2015 – Global markets were mixed ahead of the FOMC meeting

Stocks were mixed to begin the new week. Greece continues to concern traders. With Federal Open Market Committee minutes due Wednesday, the Federal Reserve was once again a focal point for investors.
United States
Both the Dow Jones industrials and the S&P erased early losses and climbed to new closing highs Monday. The Dow gained 0.1%, the S&P advanced 0.3% and the Nasdaq added 0.6%. Trading has been quiet in recent days as most major companies have already reported their latest quarterly earnings.
Endo International declined after it agreed to buy Par Pharmaceutical Holdings from private equity firm TPG for about US$8 billion in cash and stock. Ann soared after the retailer agreed to sell itself to Ascena Retail Group for US$2.2 billion in cash and stock. Eleven Biotherapeutics plunged after the company said its late stage dry eye disease treatment failed to meet its two primary endpoints. Apple gained after activist investor Carl Icahn raised his price target on the stock by 11% to US$240 and reiterated his call for the iPhone maker to buy back shares at a faster rate. Alibaba declined after a group of luxury goods makers sued the company Friday, contending that the Chinese e-commerce company knowingly made it possible for counterfeiters to sell their products throughout the world.
Greece said Monday it needed to reach a deal with creditors to get more bailout cash by the end of the month to avoid defaulting on its debt. Greek government bond prices fell on the news, sending the yield on Greece’s 10-year bond up to 11.34% from 10.60%.
US homebuilder sentiment was down in May although most builders view market conditions as favorable according to the National Association of Home Builders.
Gold at the afternoon London fixing was up US$3.00 to US$1,223.50. Copper futures were down 0.7% to US$2.90. WTI spot crude was up 3 US cents to US$59.72. Dated Brent spot crude was down 40 US cents to US$66.41. The US dollar was up against all of its major counterparts including the euro, yen, pound, Swiss franc and the Canadian and Australian dollars. The Dollar Index was up 1.0%. The yield on US Treasury 30 year bond was up 9 basis points to 3.02% while the yield on the 10 year note added 8 basis points to 2.22%. 
Europe
Most European stock markets advanced Monday despite continued concerns over the situation in Greece. The positive performance of US markets also provided some support in the afternoon. The FTSE edged up 0.1%, the CAC gained 0.4%, the DAX advanced 1.3% and the SMI was 1.0% higher.
Volkswagen, Daimler, BMW, Renault and Peugeot advanced. Both Fresenius and Fresenius Medical Care increased as did Bayer and Merck. Edenred was down after the departure of its CEO. Banks Crédit Agricole, Société Générale and BNP Paribas retreated. Babcock International climbed after reporting increased profit for the year on strong revenue growth. Sirius Minerals advanced after the potash development company issued the latest results from its ongoing global crop study program. Aveva jumped after a report said Schneider Electric discussed a bid for the company. Schneider Electric also gained. Royal Mail was up after a broker upgrade. Lloyds Banking Group retreated on a broker downgrade.
Fitch maintained the sovereign ratings of Greece, the Netherlands and Latvia over the weekend, while S&P affirmed the ratings of Italy and Georgia. Elsewhere, Moody’s affirmed Poland’s ratings. Swiss retail sales declined for a third straight month in March, although at a slower pace from the previous month. Retail sales dropped an adjusted 2.8% year-on-year following a 3.1% drop in February and 1.1% decline in January.
Asia Pacific
Stocks were mixed Monday as weak US data and signs of a continuing downturn in the Chinese real estate market offset positive core machinery orders data from Japan. Investors also kept an eye on Greece after Prime Minister Alexis Tsipras said he would not strike a deal with bailout lenders at any cost.
The Shanghai Composite was down 0.6% with builders and brokerages pacing the declines as weak housing data added to worries over a spate of new share listings. The Hang Seng shed 0.8% after climbing nearly 2% on Friday. Home prices in majority of the Chinese cities continued to decline in April. Compared to the previous month, prices of new houses declined in 48 out of the 70 cities. Average new home prices fell 6.1% from a year ago, extending declines for the eighth consecutive month.
The Nikkei added 0.8% to close at a near three week high. The advance was led by financials after Dai-ichi Life announced higher shareholder payouts and government data showed Japan’s core machinery orders were up 2.9% in March from the previous month, increasing for the first time in months in a sign of a pick-up in capital spending. Dai-ichi Life Insurance soared after the company announced plans to raise dividend payments. Mitsubishi UFJ Financial rallied as did Mizuho Financial and Sumitomo Mitsui Financial Group. Honda Motor closed 1 higher after launching its new compact Honda Shuttle. SoftBank, which holds a 32.59% stake in Chinese e-commerce giant Alibaba Group Holding, also gained. French luxury goods company Kering SA, parent company of Gucci, Yves Saint Laurent and other luxury brands, filed a lawsuit in the US against Alibaba Group for aiding the sales of counterfeit versions of its products.
The S&P/ASX was down 1.3% and the All Ordinaries lost 1.2%, dragged by banks and hefty losses in BHP Billiton after the split from South 32. The big four banks were down on concerns about a potential housing bubble in Sydney and Melbourne. Rio Tinto dropped on reports the company is exploring the sale of its Pacific Aluminium business once again, in a potential deal worth A$1 billion. Fortescue Metals ended little changed while BC Iron soared after Prime Minister Tony Abbott reportedly threw his support behind a push for an inquiry into the iron ore industry.
The Kospi added 0.3% on foreign fund buying after showing little movement for most part of the day. The Sensex jumped 1.3% as tepid inflation data released last week and the India Meteorological Department’s (IMD) prediction of a timely start to the monsoon bolstered hopes for a rate cut when the RBI meets to review its policy on June 2. Finance Minister Arun Jaitley said that his “expectation” from RBI governor Raghuram Rajan was the same as the general expectation of an interest rate cut. 
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*
The Bank of Australia publishes minutes from its policy meeting held earlier this month. The UK releases April consumer and producer price indices. The Eurozone reports final harmonized index of consumer prices for April and March merchandise trade balance. Germany posts May ZEW survey. In the US, April housing starts are on tap.
*Note — all releases are listed in local time.