Friday, 11 March: Global markets swung back into the green this morning, after investors and traders re-appraised yesterday’s ECB stimulus package. The last two trading sessions have seen tumultuous movements in Euro indices, as the Dax 30 traded a 500pt range, the CAC 40 circa 200pts, with the FTSE 100 in similar range bounds – unanimously closing down yesterday, and symmetrically snapping back and beyond in today’s trade.
The IEA issued a statement claiming that the oil market may have bottomed out as high-cost production shuts down and Iran production returned to the market slower than previously anticipated. Production outside the Organisation of Petroleum Exporting Countries will decline by 750,000 barrels a day this year, or 150,000 barrels a day more than anticipated last month. Markets were also supported by output losses in Iraq and Nigeria, Brent oil sustained gains through the week, navigating the ECB induced volatility and as we go to print stands over $3.50 up for the week, at $40.50/bbl.
Following on from speculation at the start of the week it was announced this morning that Old Mutual will split out its four businesses by the end of 2018 – Old Mutual Emerging Markets, Old Mutual Wealth, Nedbank and OM Asset Management will all be diced up. It also plans to reduce its shareholding in Nedbank by distributing the business’s shares to Old Mutual shareholders, with no plans to sell its shares to a new strategic investor. The rationale behind the split up is that it will enable simpler access to capital markets, a lighter regulatory burden and allow the separate businesses to be valued more appropriately. Earlier in the week shares rose on the speculation, but today shares traded 3.1% down, despite Old Mutual also announcing a 5% rise in net profit, with a sustained dividend. I guess you can’t please everyone.
At the close European indices were up with the FTSE 100 +1.71%, with the CAC 40 +3.27%, and the DAX 30 +3.51%.