Market madness in April? European shares hit an all-time high last night, Japanese shares reached 15-year peaks earlier in the day, while Hong Kong’s market leapt to seven-year highs amid speculation of more stimulus from China and Japan, as well as a delayed start to any rate rise from the US Federal Reserve. Shanghai’s market hit more seven-year peaks yesterday while the Philippines has reached record highs in the past month. Down here in Australia, our market is at the highest level since early 2008, while the Kiwi market is also cooking. Markets in Europe, such as Germany and France, are also doing very well (Germany has hit all-time highs), and the London market reached 15-year highs last week. Wall Street is of course near all-time highs reached last month (and on fundamentals, probably the only market to justify its current high valuation). But is all this too conventional — earnings, growth, unemployment, outlook, prospects? Who cares when interest rates are at record lows and the central banks of the eurozone and Japan are pumping billions of dollars a day into markets, on top of the sugar dump from the Fed? The IMF warned this week the developed world and emerging economies face years of sub-par growth because of poor productivity, weak demand, ageing populations and low female participation, as well as weak public and private investment. So if that’s the outlook, where’s the growth coming to come from, especially for listed companies? — Glenn Dyer
Magic pudding watch, Athens style. The Apple iWatch is available from April 24, and according to the Financial Times, Greece may very well go bust the same day, so set your analog clocks on that basis. The FT (the paper seems to be running a daily Greece On The Edge Watch) says Greece has found enough money to repay international creditors this month, but it will exhaust its cash reserves by the end of the month. In fact April 20 to 24 is now the target date for the brown stuff to hit the fan. European finance ministers meet on April 24, and the country has to have a deal in place with the finance group on a new reform package to satisfy its creditors and give it a chance to get its hands on a fresh 7 billion euro infusion. The FT says the Greek government is assuring markets it will pay the IMF 458 million euros tonight, our time, and another 420 million euros due to international investors who hold six-month treasury bills set to mature on April 14. Without agreement its hard to see Greece having the cash to meet two payments to the IMF of 950 million euros and 2.4 billion euros of pension and salary payments in May. The Syriza government faces problems with its left-wing which doesn’t want any more cuts and wants to reject all austerity measures. Overnight, Russian president Vladimir Putin and Greek Prime Minister Alexis Tsipras had a meet and greet in Moscow and said nice things, but no cash appeared to ease Greece’s pain. — Glenn Dyer
Reality fairy strikes for oil. Just when oil bulls were emerging from caves, out comes the reality fairy and waves it over the market, sending prices down again and ruining the recent 10% rally. First up, Saudi Arabia revealed it produced a record 10.3 million barrels a day in March and had no intention of reducing that figure. And then the US Energy Information Administration stunned the bulls by revealing not only a rise in weekly production (after the previous week’s surprise small fall), but said US oil stocks jumped 10.9 million barrels last week (the highest weekly rise in 14 years according to analysts), to a massive 482 million barrels. That’s a moderate-sized oil field in its own right. The rise was three times the forecast 3 million increase forecast by the market. Prices fell as a result, down 5% to 6% in the US and Europe. — Glenn Dyer
Now this is a price war. UK consumers have never had it so good, not so many UK retailers, especially the big grocery chains such as Tesco, Sainsbury’s, Morrisons and Asda. Retail prices are still sliding and UK consumers are lapping it up and it is all thanks mostly to the aggressive discounting by German giants, Aldi and Lidl. The British Retail Consortium (BRC) represents around 80% of all UK retailers, large and small and provides well-respected data on trends and sales, one of which is its monthly retail price index. March’s data showed yet another fall, for the 23rd consecutive month. The BRC index fell 2.1% in March, from 1.7% in February, with non-food items seeing the biggest fall in prices of 2.8%. UK retailers are now cutting the prices of consumer electricals to try and drive sales volumes. Food prices are still falling, down 0.9%, steeper than the 0.4% drop in February. An added influence at the moment is the fall in general inflation thanks to the drop in oil and energy prices. There’s continuing Australian media talk of a price war here, but compared to the UK talk is much cheaper than the actual price cuts. And another set of UK figures overnight showed Aldi is now the sixth-biggest retailer in the with a share of 5.3%, compared to Waitrose, the upmarket supermarket chain with 5.1%. Together with the other discounter, Lidl (3.9%) now have 9% of the UK grocery market, up from 5.4% in 2012. — Glenn Dyer
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