1) Concerns about the Middle East situation combined with slowing US performance figures to depress sentiment during the first week of July, taking the FTSE-100 down once more into negative territory for the year. As on 9th July, the index was heading toward the 6,680 level of August 2013.
2) The US economy shrank by 2.9% year-on-year in the first quarter of 2014, revised figures showed. That was the worst performance since 2009, caused by a harsh winter, slow healthcare growth and only a 1% growth in consumer spending. But 288,000 new jobs were created in June, bringing unemployment down to 6.1%, the lowest since September 2008.
3) UK house prices beat their 2007 peak, a report from Nationwide suggested. A 1% price rise in June had left them up 11.8% on a year earlier. The company said that average property prices were now £188,903, but in London they had reached £404,404 – 30% higher than in 2007.
4) Shadow Chancellor Ed Balls vowed to close the so-called “quoted Eurobond exemption”, which he said costs the Exchequer up to £500 million in lost revenues every year. He also lambasted the £1 billion growth in the 2012 ‘tax gap’ between tax liabilities and achievable tax revenues (to £35 billion) at a time when the government had vowed to reduce the gap. Earlier, HMRC had said it had raised a record £23.9bn in additional tax this year though its crackdown on tax avoidance
5) Eurozone bank base rates are likely to stay at their present levels for “an extended period of time”, according to European Central Bank president Mario Draghi. The base lending rate was dropped from 0.25% to 0.15% in June.
6) The trend toward stock market listings by wealth management groups continued, as Bromsgrove-based AFH Financial achieved a £28 million listing on the Alternative Investment Market. AFH, which intends to use the money for adviser acquisitions, says it offers a more diverse and differentiated set of exit programmes than rivals such as St James’s Place. In May, wealth manager European Wealth had also achieved a £13 million listing.
7) The government’s promise of investment advice on decumulation for new retirees looks set to hold, a survey by the Association of Professional Financial Advisers (APFA) seemed to show. 80% of the 237 financial advisers surveyed said they would see clients regardless of the size of their pension pots. The new scheme comes in next April.
8) The new ISA accounts (NISAs) announced in the spring Budget came into effect on 1st July, with the eligible annual investment now increased to £15,000. Individuals can now use these accounts for any combination of cash and shares. But commentators were divided as to how much demand would come from the general public – was the increase a hidden sop to the wealthy? Around 23 million adults, roughly half the UK adult population, are currently thought to hold an ISA.
9) Bitcoins resumed their journey back to respectability as the disposal of the confiscated Silk Road bitcoin hoard proceeded smoothly. Silk Road had been closed for facilitating illegal transactions; the orderly auction resulted in bitcoin prices regaining $640, the levels of early June, but still barely half what they had been worth last December.
10) India’s stock market was knocked out by a network outage, just as investors were speculating on the outcome of the 10th July Budget. It was the second outage in a month, and came as the Sensex approached a record level.
11) Blackrock reasserted its dominance over Vanguard in the US ETF markets during the second quarter, figures from Bloomberg revealed. BlackRock Inc’s iShares range had taken an estimated $18.1 billion in net deposits during the quarter – just half a neck ahead of first-quarter leader Vanguard Group Inc., also at $18.1 billion. Of this, $8 billion was for emerging markets funds, including $6 billion for the iShares MSCI Emerging Markets ETF.
12) BP said it would seek the return of ‘inflated’ compensation claims awarded by US courts in respect of the 2010 Deepwater oil spill. The firm had initially estimated its business liability at $7.8 billion (£4.6 billion), but it said that the courts had ‘misinterpreted’ the settlements.
13) Jihadist military attacks in Iraq and Syria boosted the prices of oil and gold slightly, as fears grew about the implications for Iraq’s oil production and export capacity. But there was no sign of a major rush toward volatile commodities.
14) The Dubai stock market rallied a little in July after losing a quarter of its value during May and June. The panic had been caused by worries about property developers who account for more than 30% of the market.