Market Commentary: US districts continue to expand, Asian stocks continue rising

Advancing towards Easter weekend, markets have been somewhat mixed. Banking stocks continue to bear the brunt of an increase in regulation, legacy issues related to past malpractices and an interest rate environment that remains unsupportive. Early indications are that the first quarter of 2014 will be weak of most international banks.

On the other hand, a stable economic recovery and an increase in consumer confidence are supporting sale of discretionary products and services such as the auto industry, the airline industry, tourism and the retail industry.

Data on the U.S. Economy shows that 8 of the 12 Fed districts continued to expand as businesses benefited from a rebound from harsh winter weather earlier in the year. The Fed has a commitment to continue supporting the recovery even as indicators are rapidly heading towards target levels.

Chatter regarding rate changes, while not on the agenda, has increased. Meanwhile the Fed is unwinding the bond-buying program it has used to support the economy.

Early this morning Asian stocks rose for a second day. The global economic cycle appears to be gradually improving and monetary conditions remain supportive. China’s Premier Li Keqiang said China isn’t considering increasing stimulus, and reiterated that economic growth of around 7.5 percent is acceptable.

This morning futures on the Euro Stoxx 50 were little changed leading to expectations that equities are heading for a weekly gain.

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