Daily Market Reviews by MAYZUS - page 11
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12 December 2013: Markets Continue Their Correctional Movement
DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.
The global markets are decreasing for the second day in a row. Strong macroeconomic statistics in the USA, which were published recently, and progress in budgetary negotiations, gave investors the idea that the FED could start cutting the program of quantitative easing next week.
Republicans and Democrats managed to agree about a cut in expenditure on defence yesterday, and on other expenses for the next two years. Even figures on expenses, which parties managed to come to consensus, are insignificant. It is an exceptional case when parties agree in principle. Nevertheless, the speech did not mention neither about a change of the ceiling of the national debt, nor about any motions concerning Obama's medical reform, and the probability of a new stop of government organizations in February, still remains. The markets regarded news from the White House as a reason for careful sales, after all, harmonious work of the Government means faster carrying out of reforms and effective work of the economy, so it can be expected that artificial incentives will be required less. But more likely it is worth speaking only about a reason for correction, instead of the real reason of decrease.
During yesterday's trading session, the American stock indices suffered considerable losses. As per the results of the trading day, indices of the US overtook the European indices on rates of decrease. The S&P 500 index showed the maximum loss in the last month, having decreased by 1.13% and closed the trading session on a level of 1782.22 points. Dow Jones lost 0.81%, reaching a level of 15843.53 points, and Nasdaq decreased by 1.4% up to the level of 4003.81 points. In the meantime, The British FTSE 100 lost just 0.24%, the German DAX - 0.41%, the French CAC 40 - 0.1%.
This morning, the situation continues to be aggravated. The trading session in Asia passed with big losses. Futures for indices are also decreasing. The meeting of the FED will take place next week and up to this point, the markets will remain highly volatile.
Commodities quotations are only changing slightly. Gold, near the level of 1250,00$ for troy ounce, does not impress long-term investors. Reserves of SPDR Gold Trust were reduced by 2.1 ton to 833.6 ton. Data of the Ministry of Energy of the USA on stocks, repeated statistics of API. For the last week, commercial stocks of Oil decreased by 10.6 million barrels to 375.2 million barrels. Brent this morning is traded on a price of 109.51$ per barrel, and WTI is at the level of 97.64$ per barrel.
Today is rich in macroeconomic statistics. During the day data on industrial production in the Eurozone will be published. Data on the import/export prices, retails, and primary requests for unemployment benefit in the USA will be also presented.
Copyright: MAYZUS Investment Company Ltd
16 December 2013: Fears Regarding Reduction Of QE Continue To Rein Over The US Stock Market
DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.
The forthcoming week promises to be the most interesting of all leaving 2013. The head of the FED, Ben Bernanke, will carry out, probably, the last meeting as the chairman and nobody excludes the possibility that he could finish his 7-year term with the beginning of the turn of stimulating measures. Undoubtedly, even the probability of such an outcome already pressed on the dynamics of stock markets, and the prospect to chop off New Year's rally could force Bernanke to reduce buying up volumes by only a symbolical sum. However, even in that case, it will be enough to return demand for the US Dollar, especially against the Yen and the British Pound.
The stock market of the USA spent Friday in the lateral range, having finished the trading session with minimum changes. However, that decrease, which the American stock indices showed for the past week, for 1.5-1.7%, was the maximum for the last 2 months. The sector of health care and telecoms appeared to be the outsiders of the week, among the different sectors.
As the result, the trading session came to an end with the Dow Jones adding 0.1% and reaching the level of 15755.36 points, S&P decreasing by 0.01% to the level of 1775.32 points, and Nasdaq growing by 0.06% to the level of 4000.97 points. Sales also were caused by the publication of preliminary data on the index of business activity in the industry according to HSBC - the indicator decreased from 50.8 points in November to 50.5 points in December.
Leading stock indices of Europe on Friday didn't show considerable changes. Following the results of the week they went down by 1.4-1.8% against macroeconomic statistics and corporate news in the Eurozone, which disappointed investors. Shares of the British insurance company RSA Insurance Group appeared to be the leader of the decline on Friday, having fallen by 7% after whispers of resignation of its executive director. Thus the British FTSE-100 index, having lost 1.7% in a week, showed a decrease for the sixth week in a row.
During the day a rather low volume of macroeconomic statistics from abroad is expected. In France, there will be preliminary data on indices of business activity in the industry and in the services sector for December. Similar indices will be published in Germany, and in the Eurozone as a whole. In the USA, reconsidered November dynamics of labor productivity and industrial production for November, will be published later on during the day.
Copyright: MAYZUS Investment Company Ltd
17 December 2013: The Stock Market Began The Week On A Positive Note
DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.
On Monday, the stock market of the United States finished the trading session with moderate growth of the main indices after the largest weeks loss since August. Since the beginning of the week, traders are concentrating on the upcoming meeting of the FED and trying to find in published macroeconomic statistics the key to the outcome of this meeting, and making their mind up if volumes of QE will actually be reduced or will be kept on the present levels. Be reminded that the beginning of cutting off the program of quantitative easing at Decembers meeting is expected by about a third of all economists, the others are still leaning towards the March meeting.
As for the macroeconomic statistical data published yesterday, it became known that industrial production in November increased by 1.1% against average forecasts of growth of 0.5%. October growth rates of industrial production were reconsidered from -0.1% to 0.1%. Labor productivity increased in the third quarter by 3%, whereas an increase by 2.8% was expected.
Following the results of the trading session, the indicator of blue chips of Dow Jones Industrial Average raised by 0.82% to the level of 15884.83 points, the index of the wide market Standard & Poor's 500 increased by 0.63% to a level of 1786.54 points, and the index of high-tech industries of Nasdaq Composite went to a plus on 0.71% and reached the level of 4029.52 points.
Leading stock indices of Europe on Monday also grew against favorable corporate news and macroeconomic statistics. One of the leaders of growth was the German DAX index which added 1.7% in the context of strong indicators of business activity in the industrial sector of Germany which were recently published. The corresponding PMI index of the production sector of Germany grew in December to maximum levels for the last 2.5 years, which says volumes about the essential increase of activity in the German industry, which could pull the entire European economy out of where it is, and into the positive zone, despite the worsening situation in France. The summary, the index of business activity of the Eurozone, characterizing the situation in the industry, and in the service sector, grew to 52.1 points from 51.7 points a month earlier, which testifies to proceeding towards the recovery of the European economy as a whole.
In the commodity market, prices for Oil are slightly down and prices for precious metals are adding in value slightly. Brent is traded on a level of 109.32$ per barrel, and losing 0.08%, WTI is decreasing by 0.16%to the level of 97.61$ per barrel. Gold and Silver are up by 0.03% and 0.16% accordingly, bargaining next to the levels of 1244.76$ and 20.13$ per troy ounce.
Copyright: MAYZUS Investment Company Ltd
18 December 2013: Today Promises To Be Hot!
DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.
Today all the markets come to a head regarding the "QE-3 turning", and today we will be able to draw conclusions on their direction for the medium-term prospect. Unfortunately, it is never easy for the meeting of the Central Banks due to the fact that too many nuances can affect the dynamics of the financial markets: how accurately are the plans for the end of the program of stimulation of the economy going to be announced? what terms will be exposed? in what volumes will the reduction will be carried out? what kind of target points will be chosen by the FED in order to take actions? And so on.
The latest macroeconomic data obviously testify in favor of the recovery of the economy of the USA, and given the current conditions, it will be difficult for the FED not to take any action. In fact, the QE-3 program reduction on 5-10 billion Dollars is already obviously included into the prices, and participants of the market are potentially ready for a similar event, and, if together with reduction of the program of repayment of assets, the target level on unemployment will be lowered to a level of 5.5%, it can be positively apprehended by the markets, as this fact will remove expectations of an increase of interest rates for almost another 2 years.
Anyway, at the programmed reduction for an amount of not less than 10 billion Dollars, we will see a small short-term correction in all stock markets, and strengthening of the index of Dollar to all currencies. Furthermore, it is necessary to pay attention to debt market if growth of profitability on American bonds is going to be resumed with new force, which will mean that investors apprehended results of meeting of the FED negatively, and it is worth preparing for correction in stock markets as well.
As for yesterday’s trading session, the American market finished the day in a minus. Investors’ opinions are still very different in relation to the decision of the FED, which will be announced in the evening, which stresses the markets and increases uncertainty. Investors prefer not to hurry in regards to their actions. Following the results of the trading session, the Dow Jones index went down by 0.06% to the level of 15875.26 points, S&P 500 decreased by 0.31% up to the level of 1781.00 points, Nasdaq lost 0.14% and reached the level of 4023.68 points.
Oil decreased the day before on expectations of reduction of demand, and also growth of deliveries from the Middle East. Commercial stocks of Oil decreased last week by 2.5 million barrels. This morning Brent is losing 0.05% and is traded on a level of 108.38$ per barrel, WTI is up for 0.22% at the price of 97.68$ per barrel. Gold and Silver are up by 0.17% and 0.36% accordingly, bargaining at the prices of 1232.14$ and 19.91$ per troy ounce.
Copyright: MAYZUS Investment Company Ltd
19 December 2013: FED Justified Hopes Of Investors, Indices Break New Records
DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.
Yesterday, the stock market of the United States of America finished the trading session on a positive note, due to the announced decision of the FED to start gradual turning of the program of quantitative easing in January, 2014. Note that following the results of the meeting of the Committee on the open market, the key interest rate remained at the former level of 0-0.25%. Representatives of the FED also noted that it will remain in this range even after the unemployment rate falls below the level of 6.5%.
As for the volume of initial reduction of repayment of securities, it was decided to cut the current QE program by $10 billion, to $75 billion, considering the improvement of the situation on the labor market of the USA. Besides, FRS declared that measures for reduction of volume of the repayment of bonds will be taken further if the economy continues to be develop steadily.
It also should be noted that during the meeting the improved economic forecasts were also announced. So, growth rates of the economy will make (in the current year) 2.2-2.3%, inflation and unemployment rates will be at the level of 0.9-1% and 7-7.1% respectively. Meanwhile, country gross domestic product in 2014, most likely, will increase by 2.8-3.2% whereas inflation will make 1.4-1.6%, and the unemployment rate will be reduced to 6.3-6.6%.
Following the results of the trading session, the Dow Jones Industrial Average index got stronger by 1.84% and was closed on a level of 16167.97 points, S&P 500 went into plus by 1.66% to the level of 1810.65 points, and the index of the hi-tech companies, Nasdaq, increased by 1.15% to the level of 4070.06 points.
Futures for Oil this morning are decreasing by 0.20% on Brent and 0.09% on WTI. Brent is traded on a level of 109.40$ per barrel, and WTI is on the price of 97.97$ per barrel. Gold yesterday started to increase in price after the announcement of the decision of the FED, but very quickly lost its strength and returned back to its usual levels. This morning, Gold is decreasing by 1.17% and is traded on the price of 1221.21$ per troy ounce, Silver is down by 2.47% at a price of 19.56$ per troy ounce.
Its also was an interesting day in the currency market, where increased volatility in all major currency pairs was observed. The decision originally weakened the US Dollar, however interest in the currency was returned quickly during Bernanke’s press conference, who practically promised that each meeting next year will actually go with program reduction on 10 billion Dollars, and by the end of 2014 QE3 will be completely reduced. One more interesting moment that the majority of officials are waiting for, is an increase in the interest rate, expected to happen in 2015. All these nuances defined the belief of investors in a bright future, however, it is better not to take everything mentioned so seriously, and it is worth dividing into two. This morning, the EUR/USD is on a level of 1.36790.
Copyright: MAYZUS Investment Company Ltd
20 December 2013: The Statistics Didn't Confirm That The Decision Of FED Was Justified
DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.
On Thursday, the American market finished the trading session with a small decrease due to the published macroeconomic statistical data. Deterioration of data on numbers of new houses and requests for unemployment benefits cast a shadow on the recent improvement of the economic forecasts of the FED, and provoked derogation of the S&P 500 index from historical maxima.
The number of primary requests for unemployment benefits unexpectedly jumped to a maximum for the last 9 months to the level of 379 thousand, from 369 thousand previously, and sales of houses in the secondary market decreased by 4.3% to 4.90 million, which was much worse than average forecasts.
As a result, following the results of the trading session, the indicator of "blue chips" the Dow Jones Industrial Average index, was closed with an increase of 0.07% at the level of 16179.08 points, the index of the wide market S&P 500 went down by 0.06% to the level of 1809.60 points, and the index of the hi-tech companies, Nasdaq, receded by 0.29% to the level of 4058.13 points.
The trading session in Asia is also not developing in a positive direction. Indices of the region bargain mainly in negative territory. The main negative continues to arrive from China, and the situation in the liquidity market remains. Yesterday, the national Bank of China carried out dot injections of liquidity on the market, however, it practically had no affect on interbank rates.
The cost of Gold fell to the minimum level for the last three years, due to the decision of the FED to reduce the program of repayment of bonds in January next year. Analysts of Goldman Sachs Group estimate that further depreciation of this precious metal should not be excluded. They believe that by the end of next year, the cost of Gold will fall to 1050.00$ per troy ounce. It should be noted that experts submitted these forecasts a month ago.
Yesterday, Gold reached the minimum level since the 3rd of August 2013, at 1188.68$ per troy ounce. This morning, the metal is adding just 0.09%, and is traded on the price of 1194.61$. Silver is up by 0.16% at the price of 19.22$ per troy ounce.
Oil prices are also down, Brent is losing 0.33% traded at the level of 109.93$ per barrel. WTI is down by 0.25% on a level of 98.79$ per barrel.
Copyright: MAYZUS Investment Company Ltd
03 January 2014: First trading day of the new year has not really been positive
DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.
Investors are just starting to return back from holiday, and the volumes on the markets are gradually increasing. The first trading day in the new year has not been as positive as the last trading days of 2013.
As a result, Dow Jones industrial average lost 0.82% and reached a level of 16441.35 points. S&P 500 decreased by 0.89% up to the level of 1831.98 points, and Nasdaq Composite weakened by 0.80%, reaching a level of 4143.07 points.
The situation in the commodities market is quite different. Oil prices lost a bit in value and are traded this morning with Brent adding 0.02% and WTI loosing 0.17%, reaching prices of 107.63$ and 95.43$ accordingly.
Prices of precious metals in comparison are adding in value, Gold is up by 0.67%, and traded on the level of 1233.42$ per troy ounce. Silver managed to overcome the level of 20.00$ per troy ounce, this morning bargaining next to the level of 20.13$ per troy ounce.
Participants of the market started to be interested again in the American Dollar, due to the fact that the American economy is showing steady growth. ISM index in the manufacturing sphere decreased in December up to 57 points from 57.3, analytics were predicting even more of a steep fall. This data and the profit fixing factor helped the Dollar to strengthen its positions, and pushed the EUR/USD to the area of 1.3670, and the GBP/USD to 1.6440.
Copyright: MAYZUS Investment Company Ltd
06 January 2014: Certain Nervousness Is Observed In The Markets
DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.
Development of the main stock markets in the world has been quite different. Key stock indices of the USA showed multi-directional dynamics, whilst trading on the European and Asian platforms has been taking place in positive territory.
On Friday, no important macroeconomic statistical data was published except for data on Oil stocks for the week, which were reduced by 7.007 million barrels, whereas a decrease of 2.975 million barrels was predicted.
As a result of the trading session, the indicator of blue chips of Dow Jones Industrial Average increased by 0.17% to the level of 16469.99 points, the index of the wide market Standard & Poor's 500 lost 0.03% and reached the level of 1831.37 points, and the index of high-tech industries of Nasdaq Composite went to a minus for 0.27% and was closed at the level of 4131.91 points.
An interesting development in the market that can be mentioned is that on Friday, prices of Gold reached a two-week maximum against expectations of a possible increase in demand for ingots and coins. Meanwhile, prices of Platinum grew to the maximum value since November. As a result, prices of Gold raised to the maximum level since the 18th of December, up to 1239.60$ per troy ounce, and this morning Gold is traded on a price of 1238.79$ per troy ounce. At the same time, futures for Platinum reached the maximum value since the 20th of November at the price of 1418.00$ per troy ounce, traded this morning on a level of 1402.98$.
Today, published by HSBC bank, was the index of business activity for December, which fell in the services sector of China from 52.5 points to 50.9 - the minimum value for almost 2 years. Before the 1st of January, industrial PMI of China, counted by national bureau of statistics, decreased from 51.4 to 51.00 points. This afternoon, indices of business activity of France, Germany and the Eurozone, are going to published. No significant changes are expected.
This year also promises to be rather positive for the American economy, and even despite the recent decrease in the ISM index in the manufacturing industry, all data still confirms proceeding restoration. This week will help people to be convinced of the continued development of similar tendencies, as a lot of statistical data will be published - data on business activity in the services sector, data on the labor market, and also the protocol of the last meeting of the FOMC, which will reflect the view of the monetary authorities on the economic prospects of the country.
Copyright: MAYZUS Investment Company Ltd
07 January 2014: Statistics From The US Didn't Inspire Investors
DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.
The trading session at the European stock exchanges began today in the red zone, however, yesterday indices showed rather flat dynamics. The index of the London stock exchange (FTSE100) was closed on a level of 6730.73 points. The index of the Parisian stock exchange (CAC40) decreased by 0.47% and reached a level of 4227.54 points, and the index of the Frankfurt stock exchange lost 0.08%, and was closed at the level of 9428.00 points. At the present time, the FTSE100 is decreasing by 0.15%, CAC40 by 0.22%, and DAX by 0.04%.
The main American indicators were closed yesterday also in the red zone, pushed down by the index of economic conditions of ISM in the non-productive sphere, which, in December, reached the level of 53, at average expectations of 54.5. Meanwhile, the orders in the manufacturing industry for November increased by 1.8%, while analysts on average predicted an increase of 1.7%.
As a result of the trading session, the indicator of blue chips of Dow Jones Industrial Average, went down by 0.27% to the level of 16425.1 points. The index of the wide market Standard & Poor's 500 became 0.25% easier and reached 1826.77 points, and the index of high-tech industries of Nasdaq Composite went to a minus by 0.44% and was closed at the level of 4113.68 points.
The statistical calendar is not too rich today. Unemployment rate in Germany for December is going to be published, the level of 6.9%, as previously predicted, is again projected. Also the consumer price index of the Eurozone for December will be presented a bit later. In the evening, data on trade balance of goods and services for November in the US will be published, a negative balance of $40 billion is expected.
At the present moment, the EUR/USD currency pair bargains next to the level of 1.3625. Prices of Oil are slightly up, with Brent increasing by 0.54% traded on a level of 106.99$ per barrel, and WTI up by 0.35% at 93.90$ per barrel. Gold and Silver are flat, traded at the prices of 1238.35$ and 20.06$ accordingly.
Copyright: MAYZUS Investment Company Ltd
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