European markets have started in positive fashion as retailers and positive moves in China set the market off on the right foot, trying to build on yesterday’s positive start. However one thing that will hold the market back will be the performance of the oil price, with any dip and test of the $30 a barrel level leaving oil and mining and any other commodity stock exposed to downside risk. Today’s sees the economic calendar come into focus with data due out now for the rest of the week, we will also be watching retailers ahead of key results from a number of big players. Already this morning we have seen Morrison's (L:MRW) post better than expected sales numbers for the Christmas period pushing their share price higher by over 10%, only a month after they were relegated from the FTSE100.
There have been strong signs overnight and throughout yesterday’s European and US sessions that markets are starting to find a bit of stability and risk appetite is starting increase somewhat. However as already mentioned we really cannot look past the oil and commodity price rout as WTI and Brent oil both look to test the $30 mark. Yet again discussions begin around just what will be the low, with many big banks now calling the lows around $20, however with continued geo political issues and a the reluctance for any movement from OPEC as well as the slowdown in China its hard to predict any sort of low.
Later this afternoon we will be looking to some key speeches from some officials in the US as well as a panel discussion later this afternoon, including Governor of the Bank of England Mark Carney. This morning we have already seen some disappointing data out of the UK with manufacturing data showing falls of -0.4% on a monthly basis and -1.2% on a yearly basis. Both industrial and manufacturing output struggled showing that UK economic conditions are still not back to an acceptable level. The numbers saw the FTSE dip lower but saw a bigger move out on GBPUSD as the pound sunk to fresh lows below 1.4500.