The first day of this week was passed with mild negative dynamics on American stock markets. The main indices closed in negative territory. The Dow Jones dipped slightly by 0.06% (20650.21), S&P 500 lost 0.16% (2358.84), the Nasdaq fell 0.29% (5894.68). The European stock adjusted downward in single dynamics. The German DAX minus 0.45% (12257.20), British FTSE 100 falls by 0.55% (7282.69).
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 07:30 MSK the RBA Decision on interest rates
At 11:30 MSK the Index of business activity in the U.K. construction sector
At 12:00 MSK retail sales in the Eurozone in February
At 12:15 MSK Speech by RBA Lowe
At 15:30 MSK the trade balance of the USA for February
At 16:30 MSK the ECB President Draghi speaks
At 17:00 MSK statement by the member of the ECB Liikanen
At 23:30 MSK FOMC member Tarullo speaks
European investors reduce purchases and take profits near all-time highs for indexes. The volatility is declining. Europe is now entering to a troublesome period, which will require economists and policymakers additional flexibility and more precise work. Yesterday German Chancellor Angela Merkel said that the EU should reduce the negative impact of Brexit, which undoubtedly will be felt in the near future. The European currency significantly reduces within second week against the major reserve currencies of the world. There is a possibility that in the DAX after reaching historic highs it will be followed by technical correction and then Euro will strengthen its position in the near future.
This morning the Australian dollar fell in price after the Australian Central Bank kept its key interest rate at previous levels of 1.5 %. AUD/USD has declined more than 0.40 percent immediately after the release of this information. RBA remains stable in decisions on the key rate, keeping it level since August last year.
There was a correction in the stock markets of the United States yesterday. During the day the index of wide market S&P 500 went below the support level of 2350 and after that rebounded recovering part of the losses. It was happen on background of published negative macro data, the index of economic conditions ISM in manufacturing sector fell in March to 57.2 from 57.7. In addition, the investors take a wait before meeting of Donald Trump and Chinese President XI Jinping in Florida, which starts on Thursday. One of the key issues discussed at the meeting will be trade relations between states.
After the upward rally last week, oil prices are in a technical correction, which may continue. The expected level of support for WTI at today, may be the price of $ 49,65 per barrel. Despite continued pressure from the shale producers, the optimism of the OPEC countries is maintained. Mohammed Barkindo, the Secretary General of the cartel noted that thanks to the coordinated work to reduce the offer, world oil inventories began to decline, which leads to stabilization in the market of hydrocarbons.
Sincerely, Global FX chief analyst Sergey Melnikov.