Fundamental Analysis

Weekly Roundup Report 02/10/2017

• October 2, 2017

EVENT RECAP: WEEK ENDING 29^th SEPTEMBER 2017   Europe   The headline event of the week was the German election results, which were released on Sunday 30th September. Angela Merkel's party has the worst defeat in almost 80 years, as the right-wing Alternative for Germany party won seats in parliament. A coalition government will now be formed with the Eurozone entering into another period of political uncertainty.  The result could shape future plans for the Eurozone and may have an impact on immigration. The German Ifo Business Sentiment report fell as manufacturers have become less satisfied with current economic conditions.     North America   The United States grew more than expected in the second quarter according to the Bureau of Economic Analysis. The figure came out higher than initial estimates with 3.1% growth during the three months ending June, with private inventory investment rising more than estimated.     Asia Pacific   Governor Kuroda highlighted Japan's moderate economic growth, which stands at 2.5% annualized, citing improving business sentiment in the manufacturing sector as the driver of exports. The pace of growth is expected to continue with current conditions reflecting the first period of consecutive growth in 11 years. In China, the Caixin Manufacturing index highlighted a slowdown in growth for both production and new orders, however, the sector continues to expand.     United Kingdom   Final figures show that the U.K. economy grew by 0.3% in the second quarter- providing no surprises. At a recent Bank of England conference, Governor Carney highlighted the bank's limited power in reducing the undesirable economic fallout from Brexit and reiterated that they will not be in a position to determine "societal challenges." The challenges he refers to, are partly affordable housing and low productivity.