Saturday, 23 December 2017

Markets mixed, separatist concerns in Spain rekindled

Markets were mixed on Friday.

The S&P 500 was essentially flat, the STOXX Europe 600 dipped 0.1 percent and the Nikkei 225 rose 0.2 percent.

Spain's IBEX 35 fell 1.2 percent after the separatist movement won parliamentary elections in Catalonia, raising fears of a return of political tension in Spain.

After a strong year, Capital Economics said that 2018 will not be as good a year for risky assets with earnings unlikely to surge and monetary policy poised to become a little less supportive.

It added that “while political developments are even harder to predict, the boosts from the prospects of U.S. tax cuts and the fading of protectionism fears were probably one-offs”.

2017 is expected to end on a positive note though.

“It’s hard to imagine equities not being held up going into December-end due to a bit of year-end portfolio fluffing,” said Tim Kelleher, head of foreign exchange institutional sales at ASB Bank in New Zealand. “We’re going to have a pretty good December on equities.”

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