LONDON - Financial markets were lacklustre on Thursday — the fifth anniversary of the start of the global credit crisis — despite hopes that China's monetary authorities will do more to shore up economic growth in the world's second largest economy.
With inflation in China falling to 1.8 per cent in July from the previous month's 2.2 per cent, expectations are rising that Beijing may ease monetary policy to boost economic growth, which has slowed sharply this year. Separate figures on industrial production and retail sales confirmed the slowdown.
"The Chinese data release that many traders were waiting for overnight may be pointing towards a slowdown but there's seemingly little to suggest this has taken anyone by surprise," said Mike McCudden, head of derivatives at Interactive Investor.
In Europe, Germany's DAX was down 0.2 per cent at 6,955 while the CAC-40 in France rose 0.1 per cent to 3,441. The FTSE 100 index of leading British shares was flat at 5,847.
The euro was down 0.2 per cent on the day at $1.2339.
Wall Street was poised for a similarly subdued opening with both Dow futures and the broader S&P 500 futures up 0.1 per cent.
The unremarkable performance contrasts with what occurred five years ago, when French bank BNP Paribas closed two funds exposed to U.S. subprime mortgages, alarming global banks, who stopped lending to each other. The credit crunch eventually led to the collapse of Lehman Brothers a year later and the deepest global recession since World War II.
The effects of that crisis are still being felt far and wide, with the world's largest economies facing differing degrees of financial trouble. In Europe, the debt crisis shows few signs of abating despite hopes that the European Central Bank is readying a new strategy to lower the borrowing rates of Spain and Italy.
Those hopes have shored up markets for the best part of two weeks. Stocks have enjoyed one of their best runs in months, while the euro has clambered off near two-year lows against the dollar and oil prices have pushed back above the $90 a barrel mark.
Picture is taken from: morningwhistle.com
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