Daily Overview of Global Markets & the SEE Region (Monday, September 18, 2017)

Banking, Finance, Markets, News, Person Profiles, Reports, Shipfinance, Statistics, Stock Markets — By on September 18, 2017 at 11:51 AM

Dr. Platon , Monokroussos, Chief Market Economist, Deputy General Manager, Eurobank Ergasias S.A.,

HIGHLIGHTS

WORLD ECONOMIC & MARKET DEVELOPMENTS

GLOBAL MARKETS: Asian equity indices surged to decade highs on Monday and major European shares followed suit hitting 6-week highs in early trade, lacking any new negative developments from the Korean peninsula. In FX markets, the US dollar held firm against the yen on Monday, with the USD/JPY hitting a new 40-day high of 111.43. Elsewhere, the GBP/USD consolidated around Friday’s 15-month high of 1.3616 following the BoE’s hawkish shift at last week’s monetary policy meeting. In the rates market, the US 10-yr- Treasury yield was trading within distance fromThursday’s one-month intraday high of 2.22% in European trade on Monday, while the 10-yr gilt yield surged to a seven-month high of 1.34% on Friday after comments by BoE policymaker Gertjan Vlieghe, who is considered a dovish voter, added to the Central Bank’s hawkish signal for an interest rate hike as soon as November. Market focus this week centres on the FOMC September meeting on Wednesday, where the Fed is expected to announce the beginning of balance-sheet normalization.

GREECE: According to the Eurogroup than convened on Friday 15 September, the themes that emerged as most critical for the period ahead were the swift conclusion of the third programme review, preferably before the end of the year, the decisive resolution of the NPLs problem by utilising all available tools and in particular the electronic auctions platform and the out-of-court workout framework, and the payment of state-arrears. Additionally, ECB’s Executive Board Member Benoit Coeure argued that according to the Single Supervisory Mechanism (SSM) an AQR is not necessary at this point while an EU-wide stress test has been scheduled to be carried out in spring 2018 and its results should be available before the expiration of the bailout programme.

SOUTH EASTERN EUROPE

BULGARIA: The Bulgarian stock market lost ground last week, while the domestic sovereign curve experienced a modest up-move and Eurobond yields did not mark any significant changes.

CYPRUS: S&P affirmed the long-term sovereign rating of Cyprus at BB+ but at the same time it changed the outlook from stable to positive. 

SERBIA: The EUR/RSD retained its downside pressure last week amid euros oversupply due to large loan disbursements from local corporate clients, but further decline was limited by renewed Central Bank intervention.

Viewers can read the full report herebelow: Daily Overview September 18 2017

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