On Friday the US stock indices moved without a single dynamics on the low volatility and closed mixed. Dow Jones rose 0.14% (21813.67), S&P 500 up 0.17% (2443.05), the Nasdaq dipped 0.09% (6265.64). European stocks went down in a single dynamics. The German DAX fell by 0.11% (12167.94), British FTSE 100 edged down 0.08% (7401.46).
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 10:15 MSK the employment rate in Switzerland for the second quarter
At 11:00 MSK M3 Money supply in the Eurozone in July
At 15:30 MSK foreign trade of the United States for July
At 15:30 MSK the Volume of commodity stocks in wholesale warehouses of the USA
At 17:30 MSK the Index of business activity in manufacturing from FRB Dallas in August
Friday's statistics on Europe has not brought a surprise and has not had much impact on the stock markets. Change of Germany GDP was at 0.8 year-on-year, which was in line with expectations of analysts. The IFO business climate index for the Eurozone was at the level of 115,9 that even better, but close to the forecast of 115.5. Today is also not expected stream of macroeconomic data, as well as UK markets are closed for a public holiday.
The long-awaited main event on Friday was the annual meeting of the financial elite in the ski resort of Jackson Hole, Wyoming. Traditionally here the current monetary policy is discussed, and it is put the plans for the new financial year. Special attention of investors was focused on the speech of Janet Yellen, which gave assessment of the current situation in the economy. But breaking the usual way, the fed chief had not reported on specific plans for the development of monetary policy, but she was only focused on the development of the economy, support of financial stability, and the regulation of banks. There were not heard a hint of a rate rise this year. Afterwards investors rushed to close long positions in the dollar, which sank to the lowest in two and a half years against all reserve currencies, mainly against the Euro and the franc. But the impact to the stock market was minimal, the explosion of volatility was not caused.
There was hope for the statement by the head of the European regulator. ECB President Mario Draghi spoke later, but also spared the disclosure of specific steps of monetary policy and mainly he focused on development issues of globalization and the rise of protectionism. As a result, the market participants remained to be misunderstood of the method of choice the direction for the stock markets. But this situation is likely to push traders to close long positions, as well as care in a "safe haven" of precious metals and the yen. In the end of the day gold added to the price 0.5 % due to weakening of the dollar, which is also equal to the weekly growth of this asset.
Another one important news for the markets was a storm Harvey, which is approaching South-East coast, where there are a large number of oil-refiners. Thus was triggered by the spike in gasoline prices. Oil also rises in price, but only because of the risk of lower production in the Gulf of Mexico. Basically the aftermath of a hurricane can be estimated based on data on stocks of petroleum products, which will be published in the middle of the week.
Sincerely, Global FX chief analyst Sergey Melnikov