[B]Daily Market Analysis – 28th July, 2015[/B]
[I]By FxGrow Research & Analysis Team[/I]
[B]China Slowdown worries Global Investors[/B]
In China growth has fallen to the lowest level since 2009 as Shanghai stocks plunged by 8.48% on Monday, in spite of government efforts as the world’s second largest economy is heading towards a slowdown.
Globally investors are worried that the slowdown in China will pull other major economies including the US and Japan as Europe is already under pressure from its member countries.
Major concerns are that the foreign trade between US and China may get affected and the slowdown will affect industries in USA. Many of US companies are involved in trade with China which may get affected.
As the economy of China is driven by debt, the slowdown will start a financial crisis which could spread to the other parts of the world.
“Even if China’s economy maintained its growth rate, the main contribution would be from public investment, so the effect on Asian economies and Japan’s exports warrants due attention. The slowdown in exports and output are likely temporary” - Bank of Japan Deputy Governor Hiroshi Nakaso.
Many U.S. consumer companies are brushing aside worries that China’s weakening economy and sputtering stock market will dramatically damage their bottom lines even with early trouble signs in recent earnings reports - Reuters.
The Chinese economy has faced difficulties this year as decelerating growth in factory output, retail sales and domestic investment has been compounded by a slowing property market - Reuters.
A slowdown in China will have a spillover effect on many countries including USA, UK, Australia, India and Europe.
In China Manufacturing activity plunged in the month of July to 48.2 hitting a 15 month low showing signs of a slowdown in the world’s second largest economy.
Greek Prime Minister Alexis Tsipras seeks support of the Syriza party to tackle the new 86billion euro EU-IMF bailout.
“Collective, democratic regrouping procedures are called for. Our strategy must be clarified… The congress procedure must be set into motion as soon as possible” - Greek Prime Minister Alexis Tsipras.
Greek PM is aiming to strike a deal with its European creditors soon, before dealing with the internal conflicts in the party.
Crude Oil is trading lower at $47.13 on China stock market collapse and oversupply concerns.
Gold is trading lower in the Europe at 1094.60, while Silver is weak 14.57
[B][I]28th July 2015 – 03:02hrs GMT[/I][/B]
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[I][B]Note:[/B] This analysis is intended to provide general information and does not constitute the provision of INVESTMENT ADVICE. Investors should, before acting on this information, consider the appropriateness of this information having regard to their personal objectives, financial situation or needs. We recommend investors obtain investment advice specific to their situation before making any financial investment decision.[/I]