UK equities reverse earlier losses.

9th December 2011

Ian Copelin, Investment Director, my wealth, comments, “Yesterday’s market volatility (see below commentary) has continued this morning after European leaders failed to forge a unanimous accord, coupled with mixed economic data from China, Japan and South Korea overnight.

The FTSE-100 initially open 43 points lower, but is currently (11am) up 32 points!

China’s inflation (Consumer Prices Index) slowed to 4.2% year-on-year from 5.5% last month, while industrial production rose 12.4% year-on-year down from 13.2% last month and was less than forecast (12.6%).

Bringing down China’s inflation is a good thing (earlier this year it was running at 6.5%) and today’s data bolsters the case for more stimulus measures to help keep the world’s second-largest economy growing.

Japan’s economy grew less than the government’s initial estimate last quarter – although Japan’s growth rebounded strongly in the aftermath of the March earthquake, it was less than initially estimated (GDP increased at an annualised rate of 5.6% over the last quarter, compared with a preliminary figure of 6%).

In South Korea, the central bank warned that it may cut its economic growth forecast for next year if Europe’s crisis worsens beyond the first quarter.”