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(From Financial Director)
It is no surprise that the conclusion to the hostilities in Iraq didn't provide an instant boost to the global economy. It has perhaps removed a potential drag on growth, although conditions were difficult even before geopolitical issues came to the fore. But earnings reports provided some good news.
Economic background
The rapid collapse of Iraqi's regime quelled any short-term anxiety over geopolitical risk, and global equity indices extended their rally during April. An overall rise of 8% in the FTSE World Index concealed some significant differences in performance from stock markets across the globe. Western markets performed well and there were recoveries from some of the markets hardest hit in the earlier downturn.
Earnings reports also proved a pleasant surprise, given continuing (and probably growing) concerns about the global economic outlook. Industrial survey data has almost universally disappointed in recent weeks, while further evidence of slackness in the US labour market provided more ammunition for those concerned about a collapse in US consumption.
Equities It should have come as no surprise that the conclusion of hostilities in Iraq did not provide an instant boost to the global economy. It has perhaps ...