On Thursday Stock markets in America showed a single strong negative trend. Dow Jones fell by 4.15% (23860.46), S&P 500 collapsed by 3.75% (2581.00), Nasdaq fell by 3.90% (6777.16). European markets also dropped in unified dynamics. The German DAX index fell by 2.62% (12260.29), the British FTSE 100 fell by 1.49% (7170.69).
Today it is expected a few publications of the macroeconomic data and the speeches of the monetary authorities that could affect investors' decisions during the trading sessions.
- At 03:30 MSK Housing loans Australia
- At 03: 30 MSK report on monetary policy of the RBA
- At 07:30 MSK the Index of business activity in the services sector of Japan
- At 09:45 MSK the unemployment rate in Switzerland
- At 12:30 MSK industrial production of great Britain
- At 12: 30 MSK the volume of production in the manufacturing industry of great Britain
- At 12:30 MSK UK trade Balance
- At 16:00 MSK Estimate of UK GDP growth from NIESR
- At 16:30 MSK the Change in employment in Canada
- At 16:30 MSK the unemployment rate Canada
- At 19:45 MSK the Speech of the member of the monetary policy Committee of Cunliffe
- At 21:00 MSK the Number of drilling rigs from Baker Hughes
Yesterday, against the backdrop of import growth in China by 36.9% up to $180 billion, the country's trade balance fell by half to $20 billion, which pushed European investors to close some positions and led to a correction of the market. The ECB is trying to decide how fast to roll back stimulus measures. The regulator should stop quantitative easing program after September of this year. Bundesbank President Jens Weidman said that if region economic growth meets expectations, the purchase of assets, in addition to the already announced volume, will not be required. The Bank of England left its key base rate unchanged at 0.5%, which was set in early November 2017. This decision coincided with forecasts of analysts.
The US government suspended the work again. It happened at midnight local time or at 08:00 Moscow time. Despite this, the work of the upper house of Congress continues. First, Republicans and Democrats announced the approval of the budget, with an increase in spending of $300 billion, but after the Senator from the Republican party Rand Paul demanded to vote on its amendment, providing for funding within the current limits. This is the second time in a month when the US government is forced to stop its work.
Also yesterday, the President of the Federal reserve Bank of Minneapolis Neil Kashkari, who said that we should not hurry to conclusions about the future pace of interest rate hikes, as long as there is no expected wage growth. Also the head of new York fed William Dudley believes that the three rate hikes this year are a reasonable solution.
Yesterday, the US stock market went into negative territory quickly. The main factor is US government securities are getting cheaper again, the yield of 10-year US Treasuries reached a maximum of 2.87% in four years. The number of initial applications for unemployment benefits for the week amounted to 221 thousand, expected 232 thousand.
Following the strengthening of the dollar, oil prices are falling down. Now the price of futures of Brent is below $ 65 per barrel, which is the first since December. Investors continue to react to forecasts of record growth of production in the USA. Also, the market is pressed by the message about the launch of the pipeline Forties, which was closed on Wednesday.