It was yet another tough week for global stock markets, with the Dow Jones & S&P 500 declining 3.78% on the week and the FTSE down 3.37%. With oil rallying $4, renewed trouble in the financial sector, downgrades to monoline insurers and trouble in the Middle East, markets encountered an ugly storm on Friday.

Crude oil prices continued to hold above the $130 handle after competing news flows kept oil prices within a $10 range over the week. Downside pressure came from the Chinese government stating that it would be putting up energy prices. With China behind a large proportion of crudes bull run, there is the potential for demand to drop significantly on the back of this. China is the second largest fuel consumer after the US, pushing sales in SUVs thanks to fuel subsidies. Now, as in the US, prices are starting to bite and demand could soon subside. The biggest factor in the future price of oil will be the outcome of the Saudi conference on oil this weekend.

Elsewhere, US leading economic indicators came in at slightly better than indicated, but the Philadelphia Fed Manufacturing index registered its worst reading for 20 years. On the company front, there were some disappointing earnings from Fedex. The logistics company has been hit hard by the price of oil and is seen as a bellwether for the global economy....