GENERAL PROPERTY INSURANCE
The US non-manufacturing ISM continued the run of recent improving economic indicators, rising to 43.7 from 40.8, beating expectations centred on 42.2. The increase took the index further from its recent cyclical low of 37.4, suggesting that the recent heady pace of contraction in the US service sector will slow in the coming months. The production, new orders, export orders and employment indices all registered decent gains.
US Federal Reserve Chairman Bernanke spoke this afternoon, and warned that “a relapse in financial conditions would be a significant drag on economic activity and could cause the incipient recover to stall”. However Bernanke sounded cautiously optimistic about the better signs in the economic data, noting “signs of bottoming” in the US housing market. Bernanke interestingly noted that the FOMC spent the first day of its recent meeting on exit strategy.
US stocks fell on Tuesday despite the better than expected economic data. Investors remained cautious and were happy to take profits ahead of the release of the bank stress tests due out tomorrow. The KBW banking index fell 1pct. Shares of Microsoft fell 2.5pct weighing on the Nasdaq. Kraft (up 4pct) foods posted a $662 million first quarter profit ahead of analyst expectations thanks to cost cutting and a rise in margins. The US Dow Jones fell by 16 points or 0.2pct with the S&P 500 lower by 0.4pct and the Nasdaq lost 9 points or 0.5pct.
General Property Insurance
