Tuesday lacked meaningful market moving data but the Chinese data overnight was in line with the general mood regarding China. Retail activity was marginally improved but industrial output was down and that was to be expected really.
What wasn't expected was a jump in the level of consumer confidence in Australia. Two straight months of improvement have taken the index to 101.7; crucially that is above the 100 level that marks the divide between optimism and pessimism. This is perhaps a reflection of the expectation of lower interest rates in Australia but the weight of the Chinese data was enough to prevent the Aussie Dollar strengthening.
In spite of a lack of UK data yesterday, the Pound held its own and even gained a smidgeon against most currencies. We get the UK unemployment data this morning and another minimal loss in jobs is expected. This slow burn recovery in the labour market, with minor rises and falls is a better outcome than volatile ups and downs we are seeing in the US data. It breeds confidence amongst investors and is part of the background to the general recovery in the value of the Pound. If the data shows more than 3.0% rise in average earnings and anything near unchanged numbers on the jobseeker register, Sterling will probably gain this afternoon. Beware of surprises though; the redundancies being announced in the steel industry and elsewhere could well catch the markets by surprise.
We get Portuguese inflation data later today but the political situation in Portugal is the main talking point for Europe. The new left wing group coalescing to form a government is prompting comments like 'Portugal will be the next Greece' and similar. As Portugal is a small component of the Eurozone, it is perhaps not a major story but it is another chink in the Euro's armour.
And I will honest enough to say I am old enough to remember the VHS versus Betamax battle of the 1970s and we all (except the youngsters obviously) know that VHS won the battle and was the king of video recording for a decade or so before DVDs took over. What we heard yesterday though is that Sony; the Betamax inventors, are still producing tapes for Betamax machines. Well if you are a Betamax aficionado and I am guessing this is a small audience, you’ll need to stock up before March 2016 because they are ceasing production. I guess that’s progress. As long as they keep making flairs with flowery seam inserts from the knee down, I’ll be just fine.
Two 5 year olds meet for the first time.
“Hello, what’s your name?” says Jenny
“I’m Charlie. What’s your name?”
“I’m Jenny. Why are you in the playgroup?”
Charlie says, “My dad dropped me off. He’s a lawyer.”
“Honest?” says Jenny
“No, just a normal lawyer”, says Charlie.