At the first day of trading after the Christmas holidays stock markets of USA has demonstrated a single upward dynamics. Dow Jones has grown slightly by 0.06% (19945.04), S&P 500 rose by 0.22% (2268.88), the Nasdaq added 0.45% (5487.44). European markets also closed in the green zone. The index of Frankfurt stock exchange DAX rose by 0.19% (11472.24), British FTSE 100 rose 0.06% (7068.17).
Today we expect a small block of the macro economic data from different countries, which may affect decisions of market participants during the trading sessions.
At 02:50 MSK Japan was to release Industrial Production for November.
At 02:50 MSK Japan was to release Retail Sales for November.
At 12:30 MSK the UK is to release BBA Mortgage Approvals.
At 18:00 MSK the UK is to release Pending Home Sales for November.
It seems that after Christmas, investors came back in a good mood, which is reflected in the positive dynamics of quotations. Support for growth was provided by the data and by absence of apparent negative news. Consumer confidence in December exceeded analyst expectations. All reactions to the unexpected result of the election have long departed and market participants are thinking about the future prospects. Until now it possible to see only a lot of promises and hope heated by rhetoric. The macro economic data in order, but this was the same six months ago.
The index of wide market S&P 500 opened with a gap up, but was not able to develop a continuation of the dynamics. It still remains within the consolidation range 2250-2275, which is trading for more than 2 weeks. Trading volume on the first day after Christmas was extremely low, only about 4 Billion shares, it's literally one of the lowest volumes for the expiring 2016. Thus, the market remains thin and there are fears that it may last until the end of the last week of the year. If everything goes this way, rise of volatility we will see in January.
The dollar still has prerequisites for growth, it is scheduled at the December meeting the Fed rate hike within the next year. So investors will continue to come out of their protective assets, such as precious metals. In gold there is now a technical correction after six months of downfall, and it is possible that the yellow metal might still show new lows.
Oil continued to rise, without striking reasons for the decline. Hope for an agreement signed in Vienna gives support to growth. As evidence of this was the statement from Venezuela that the country is going to cut supplies for 95 thousand barrels a day. Today investors ' attention will be focused on the weekly report from the American Petroleum Institute.
Sincerely, Global FX chief analyst Sergey Melnikov.