Unit­ed States: Dur­ing the week end­ed Sep­tem­ber 16, eco­nom­ic da­ta on re­tail sales, in­fla­tion and con­fi­dence lev­els were re­leased. Re­tail sales for the month of Au­gust were un­changed, com­pared to 0.5 per cent in­crease in Ju­ly. The high un­em­ploy­ment rate con­tin­ues to in­flu­ence the con­sumer as spend­ing re­mains low. Re­tail sales have been rel­a­tive­ly con­strained, af­ter peak­ing ear­li­er this year in Feb­ru­ary. As the hol­i­day sea­son ap­proach­es in No­vem­ber, there is like­ly to be an up­surge in sales as re­tail­ers of­fer dis­counts and pro­mo­tions to boost sales-as seen in late 2010.

In­fla­tion in the US as mea­sured by the Con­sumer Price In­dex (CPI) in­creased to 3.8 per cent (year-on-year) in Au­gust, ris­ing 0.2 per cent from the pre­vi­ous month. Core in­fla­tion al­so in­creased mar­gin­al­ly to 2.00 per cent (yoy) in Au­gust from 1.8 per cent in Ju­ly. Al­though the rate has trend­ed high­er this year, rel­a­tive to last year (where de­fla­tion was a con­cern), it is large­ly due to tran­si­to­ry fac­tors aris­ing from high­er fu­el prices and sup­ply dis­rup­tions from the Japan earth­quake and tsuna­mi ear­li­er this year.

Con­sumer con­fi­dence as mea­sured by the Uni­ver­si­ty of Michi­gan Con­fi­dence In­dex, rose to 57.8 based on pre­lim­i­nary es­ti­mates for Sep­tem­ber, up from 55.7 in Au­gust. De­spite the mar­gin­al im­prove­ment, con­fi­dence lev­els re­main rel­a­tive­ly low as eco­nom­ic growth con­tin­ues to be a key con­cern.

The Uni­ver­si­ty of Michi­gan stat­ed that con­sumer ex­pec­ta­tions six months from now dropped to the low­est lev­el since May 1980, un­der­scor­ing the weak sen­ti­ment con­sumers have with re­gards to the econ­o­my.

For the week Sep­tem­ber 19 to 23, da­ta on the hous­ing sec­tor, in terms of hous­ing start and new home sales, are ex­pect­ed to be re­leased. Al­so dur­ing the week, the Fed will hold a two-day meet­ing to dis­cuss the state of the econ­o­my at its FOMC meet­ing. This will be wide­ly an­tic­i­pat­ed as the mar­kets seek some in­di­ca­tion of sta­bil­i­ty to the cur­rent volatil­i­ty.

Eu­ro­zone: Of­fi­cials from the Eu­ro­pean Union and the In­ter­na­tion­al Mon­e­tary Fund were ex­pect­ed to meet with Greece's fi­nance min­is­ter on Sep­tem­ber 19 to col­lect in­for­ma­tion on whether the Greek gov­ern­ment is el­i­gi­ble for an Oc­to­ber aid pay­ment. Greece has enough cash re­serves to sat­is­fy its needs un­til Oc­to­ber. On Oc­to­ber 3, eu­ro-area fi­nance min­is­ters will meet to de­cide on the re­lease of the in­stall­ment. If ap­proved, the loan would be dis­bursed by mid-Oc­to­ber and will al­low the gov­ern­ment to pay its bills up to the end of the year.

The con­tin­ued un­cer­tain­ty over Greece's debt sit­u­a­tion re­sult­ed in the yield on Greek two-year debt ris­ing above 70 per cent dur­ing the third week of Sep­tem­ber. The French pres­i­dent and Ger­man chan­cel­lor have stat­ed that they are con­vinced that Greece will stay in the Eu­ro­zone. The ECB has an­nounced that it will co­or­di­nate with the US Fed­er­al Re­serve and oth­er cen­tral banks in or­der to con­duct three US dol­lar liq­uid­i­ty op­er­a­tions by the end of the year to en­sure Eu­ro­pean banks have enough of that cur­ren­cy for their op­er­a­tions.

Unit­ed King­dom: In­fla­tion in the UK for the month of Au­gust was re­port­ed at 4.50 per cent. Core in­fla­tion for this pe­ri­od was 3.10 per cent, while the un­em­ploy­ment (ILO) was re­port­ed at 7.90 per cent. The Bank of Eng­land has stat­ed that its bond-pur­chase plan has had eco­nom­i­cal­ly sig­nif­i­cant ef­fects on Britain's fi­nan­cial sys­tem. It was es­ti­mat­ed that the ac­tion may have raised gross do­mes­tic prod­uct (GDP) be­tween 1.50 per cent and 2.00 per cent, and in­creased in­fla­tion by 0.75 per cent to 1.50 per cent.

Brazil: The Brazil­ian Re­al fell against the USD with­in the last month to a lev­el of BRL1.78:USD1 at the time of writ­ing. This was sig­nif­i­cant­ly high­er than the av­er­age for Au­gust of BRL1.59:USD1. The de­pre­ci­a­tion in the cur­ren­cy is large­ly at­trib­uted to the in­creased flows of funds from Eu­ro­pean banks in Brazil, back to par­ent com­pa­nies in Eu­rope.

US stocks ad­vance on Eu­ro­zone op­ti­mism

Eu­ro­zone de­vel­op­ments once again con­trolled mar­ket mo­men­tum with some tem­po­rary re­lief that the re­gion's debt cri­sis could be con­tained. This saw a 5.35 per cent gain in the S&P 500 in­dex week-on-week to 1,216.01 as at Sep­tem­ber 16, mark­ing the third-biggest week­ly gain in the in­dex since 2009. Cycli­cal stocks led the ral­ly dur­ing the week led by In­tel Cor­po­ra­tion, up 11.52 per cent to US$21.97, Home De­pot In­cor­po­rat­ed, which saw an 8.60 per cent gain to US$34.61 and Gen­er­al Elec­tric, which closed US$1.00 high­er at US$16.33.

The US mar­ket re­mains sen­si­tive to in­ter­na­tion­al de­vel­op­ments, name­ly the out­come of the Greek debt cri­sis. Eu­ro­pean banks are hold­ers of Greek debt so any de­fault will be a huge blow to the bank­ing and fi­nan­cial sec­tor and not lim­it­ed to the Eu­ro re­gion. Large-cap stocks in­creased send­ing the Dow Jones in­dex up 4.70 per cent to 11,509.10. The tech-heavy Nas­daq in­dex got a boost from Dell In­cor­po­rat­ed, which was up 8.8 per cent due to an in­crease in its share buy­back pro­gramme, send­ing the in­dex up 6.25 per cent to a close of 2,622.31.

Eu­ro­pean stocks rise on ECB liq­uid­i­ty plans

Con­fir­ma­tions from Ger­many and France that Greece will re­main a Eu­ro mem­ber and the an­nounce­ment made by the Eu­ro­pean Cen­tral Bank (ECB) of liq­uid­i­ty mea­sures with the Fed to en­sure banks have enough dol­lars had a pos­i­tive im­pact on the mar­ket. The Stoxx 600 Eu­rope In­dex was up 2.48 per cent week-on-week to 230.16. Ger­many's Dax in­dex closed 7.39 per cent high­er for the week to 5,573.51 while UK's FTSE 100 closed slight­ly low­er at 5,368.41.

Asian stocks gain on Eu­ro con­fi­dence

In­creased hope that the ECB's plan to tack­le the debt cri­sis would pre­vent an­oth­er glob­al fi­nan­cial cri­sis sent the MSCI Asia Pa­cif­ic In­dex up 1.91 per cent to a close of 120.26 dur­ing the week of Sep­tem­ber 12 to 16. Hong Kong's Hang Seng In­dex closed the week at 19,455.30, up 2.23 per cent, while Chi­na's Shang­hai Com­pos­ite In­dex saw a mar­gin­al in­crease of 11 points to a close of 2,482.34.

T&T stock mar­ket:

TTSE Com­pos­ite In­dex sees mar­gin­al de­cline

The Com­pos­ite In­dex saw a mar­gin­al in­crease dur­ing the week end­ing Sep­tem­ber 16, ris­ing by 0.86 per cent to a val­ue of 979.26 as 12 stocks ad­vanced and four de­clined. Na­tion­al Com­mer­cial Bank Ja­maica Ltd (NCBJ) was the week­ly vol­ume leader, with 11,184,174 shares trad­ing at a clos­ing price of $2.10. Sagi­cor Fi­nan­cial Cor­po­ra­tion saw the largest price ap­pre­ci­a­tion ris­ing by 4.43 per cent dur­ing the week to a close of $8.01. Year-to-date, the TTSE Com­pos­ite In­dex is up 17.19 per cent.

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