Morning Briefing: Markets prepare for tough earnings season

Markets prepare for tough earnings season... IMF in favour of negative rates, Blackrock CEO disagrees...

Steve Randall
Markets prepare for tough earnings season
Monday’s trading around the world has started with some buoyancy as oil prices remain steady, although lower as the producers’ meeting gets closer.

However, Wall Street analysts are predicting a tough earnings season which could see profits wiped from many major companies. Meanwhile, the City of London is reeling from a report from the Centre for Economics and Business Research, which says that market activity has slumped to a worrying level which could see layoffs in the financial sector.

Asian equity indexes closed mainly higher Monday with China’s inflation data for March showing a 2.3 per cent rise in the CPI and a 0.4 per cent decrease in consumer inflation. The results were not unexpected by analysts. Tokyo was again pressured by a stronger yen and the Nikkei closed lower. Sydney and Seoul also ended the session with losses.

European markets are trading higher, except for London, as oil and banking stocks rise.
Wall Street and Toronto are expected to higher.
  Latest 1 month ago 1 year ago
North America (previous session)
US Dow Jones 17,576.96 (+0.20 per cent) +2.11 per cent -2.66 per cent
TSX Composite 13,396.73 (+0.98 per cent) -0.93 per cent -12.94 per cent
Europe (at 5.30am ET)
UK FTSE 6,201.23 (-0.05 per cent) +1.00 per cent -12.53 per cent
German DAX 9,695.24 (+0.76 per cent) -1.38 per cent -21.65 per cent
Asia (at close)
China CSI 300 3,230.10 (+1.39 per cent) +7.02 per cent -25.65 per cent
Japan Nikkei 15,751.13 (-0.44 per cent) -7.01 per cent -20.88 per cent
Other Data (at 6.30am ET)
Oil (Brent) Oil (WTI) Gold Can. Dollar
(-0.29 per cent)
(-0.43 per cent)
(+0.43 per cent)
Aus. Dollar

IMF in favour of negative rates, Blackrock CEO disagrees
The International Monetary Fund has given support to negative interest rates implemented by some central banks including the ECB and BoJ.

In a research paper, the IMF’s director of monetary and capital markets Jose Vinals wrote: "Although the experience with negative nominal interest rates is limited, we tentatively conclude that overall, they help deliver additional monetary stimulus and easier financial conditions, which support demand and price stability.”

However, the CEO of investment firm Blackrock says that the move to negative rates could hit spending. Larry Fink warned his shareholders that the minus rates had limits and says that there is a risk that they could actually harm the economies that they are intended to boost.