On the first day of this week, American stock markets shown mild positive trend and closed in green zone. Dow Jones rose 0.08% (20837.44), S&P 500 up 0.10% (2369.73), the Nasdaq added 0.28% (5861.90). European markets also resumed growth and ended the trading session in positive territory. Germany's DAX added 0.16% (11822.67), British FTSE 100 grew 0.13% (7253.00).
Today it is expected the number of publications of the macroeconomic data and the speeches of the monetary authorities that could affect investors' decisions during the trading sessions.
At 10:45 MSK French GDP for the fourth quarter.
At 11:00 MSK the Index of leading economic indicators KOF in February.
At 16:30 MSK U.S. GDP for the fourth quarter.
At 17:45 MSK the Index of business activity (PMI) in Chicago in February.
At 18:00 MSK the Index of consumer confidence CB in the U.S. in February.
At 19:00 MSK Speech of Donald Trump in the U.S. Congress.
At 23:00 MSK FOMC member Harker speaks.
At 23:30 MSK FOMC member Williams speaks.
The reporting season for the fourth quarter almost finished in the United States and the majority of the companies included in the index of wide market S&P 500 showed the results. It is glad that only a quarter of them reported lower than expected, mainly reported about the growth of incomes and revenues, which creates a positive background for the U.S. market as whole. One of the last reported Sotheby's, the auction house, also showed results above expectations. As the result its market capitalization has increased more than 15% yesterday. Goldman Sachs analysts downgraded the electric car manufacturer Tesla with a "sell" recommendation, after which the share price sank more than 4%.
Despite the positive background from the corporate reporting the rally in the market came to a standstill, and now it is in a low volatility sideways movement for several days. Investors awaited a speech by Donald Trump in Congress. It will take place today at 19:00 Moscow time. As it was announced a couple of weeks ago, the President will reveal details of "phenomenal" tax reform, as well as he will talk about the reduction of state control in the financial industry, health care and actual steps in strengthening of the infrastructure. Among investors there is some caution, because the President already earned a reputation as a leader capable for an eccentric and unpredictable actions. This reduces the risk appetite. If market participants will not hear, what they want, the rally may be replaced with the drop.
Volatility reduced in the energy sector. Oil is trading near year highs. Investors are also waiting for news about a change of economic policy in the United States, as they can affect the dollar in which oil is quoted. If after today's statements of the President in Congress, the dollar will fall in price, this can stimulate the release of black gold to new heights.
Sincerely, Global FX chief analyst Sergey Melnikov