On Thursday, stock markets of America showed a single negative trend and closed in the red zone. The Dow Jones dipped 0.07% (21359.90), S&P 500 lost 0.22% (2432.46), the Nasdaq fell by 0.47% (6165.50). European stocks closed in red zone also. The German DAX fell by 0.47% (12691.81), British FTSE 100 dipped 0.74 %(7419.36).
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 06:00 MSK the Report on monetary policy Bank of Japan
At 09:30 MSK Press conference of the Bank of Japan
At 11:00 MSK the Meeting of EU Finance Ministers
At 12:00 MSK the Eurozone CPI for May
At 12:00 MSK on the Level of wages in the Eurozone in the first quarter
At 15:30 MSK the Number of issued building permits report for May
At 17:00 MSK the Index of consumer expectations from the University of Michigan for June
At 17:00 MSK the Index of consumer sentiment from the University of Michigan for June
At 19:45 MSK FOMC member Kaplan speaks
At 20:00 MSK the Number of drilling rigs from Baker Hughes
The American stock market participants remains cautious in its actions after the actions of the Fed to tighten monetary policy despite weak data of the macroeconomic indicators in recent weeks. The index of wide market S&P 500 opened with a strong gap reaching a bottom of the current range trading in the area 2315-2318, pushed away from it, but finally failed to close the gap. The increase was due to positive statistics of business activity index, which rose more than expected, and the number of initial claims for benefits fell by a count greater than predicted. The desire to open new positions in the stock reduced due to news about the launch of an investigation against Donald Trump in the case of obstruction of justice.
The main blows of sellers came to the companies of the high-tech sector. This is due, among other things, a strong overbought these companies, capitalization of which in recent months has grown stronger than the market. Possible correction in this sector will continue for some time. Facebook is reduced by 1.03%, Alphabet falls by 1.83%, Amazon lost 2,01% of the capitalization.
The US dollar continues to strengthen is for second day and now it is trading at two-week high against world currencies. Today Bank of Japan continued a week of Central Banks. It saved the key rate of the country at the same level, as well as the volume of asset purchases at 80 trillion yen a year. This decision the regulator explained by the increase of stability in the consumer sector against the background of the steady improvement in employment and income. Yen reacted with a continued weakening today in the Asian session.
As expected, yesterday the price of WTI continued to decline and reached the level of $ 44,50 per barrel, there is hope for a corrective growth at that level. The OPEC report for May continues to act on the inverters opinions. According to published data, the growth of supply from countries not members of the cartel can reach 0.7M barrels. Belief in positive results of the Vienna Treaty is melting every day. Additional pressure came from the publication of data from the Ministry of energy about the growth of stocks of gasoline. This news goes against market expectations for increased demand during the peak summer driving season. Today the investors will assess data on the number of drilling rigs from Baker Hughes.
Sincerely, Global FX chief analyst Sergey Melnikov.