On Wednesday, the stock indices were growing in the single dynamics and closed at the end of the day in the green zone. Dow Jones up 0.68% (21454.61), S&P 500 rose by 0.88% (2440.69), the Nasdaq jumped by 1.43% (6234.41). The European Union has demonstrated a single negative trend and closed in the red zone. The German DAX is declining by 0.19% (12647.27), British FTSE 100 fell 0.63% (7387.80).
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 02:50 MSK the Volume of retail sales in Japan in May
At 04:00 MSK new home Sales for May Australia
At 04:00 MSK the Index of business confidence in New Zealand in June
At 09:00 MSK the Index of German consumer climate for July
At 15:00 MSK the consumer price Index (CPI) for June
At 15:30 MSK US GDP for the first quarter
At 15:30 MSK Deflator of US GDP the first quarter
At 15:30 MSK the Number of initial applications for unemployment benefits USA
At 20:00 MSK FOMC member Bullard speaks
In Europe, the statements of the heads of Central Banks continues to be in the focus. After the ECB, the Bank of England Governor Mark Carney announced the imminent start of the tightening monetary policy and raising key interest rate. He said that the reduction of the stimulus may become necessary and is likely to happen if the factors that prevent it will not be significant. By his words such measures as increasing of investment, the growth of wages, and the reaction of the country to withdraw from the EU can facilitate changing of monetary policy. Statement of Mark Carney led to a further strengthening of the national currency. The GBPUSD came close to the highs of the month and resistance at the 1.30 level, it also influenced the decline of the FTSE 100. Investors will follow the development of events.
The dollar continues to decline, as against the pound and against the Euro. EURUSD keeps rising, and today during the Asian session reached the intermediate target of 1.14, after which, it is likely technical correction will be followed. Investors continue to lay to the market prices their expectations of monetary policy tightening in Europe, the door where was opened by the head of the ECB Mario Draghi in a recent statement.
Besides of the Euro growth, an increasing of risk for companies in IT sector was reason for decline for European stocks. It is due to the continued manifestation of the consequences of cyber-attacks using the malicious virus. It was found that cyber-epidemic has begun its way in Europe, in the Ukraine. The development of infection still not stopped.
U.S. stocks have rose due to the weakening of the dollar, and on the background of published data on the reduction of the trade deficit. The index of wide market S&P 500 continue to trade within the range of 2420-2450. It is probable that it will be there a few days more.
A message from the Ministry of energy of the USA about growth of stocks on 0,118 million barrels against analysts ' expectations had no impact on the growth dynamics of oil. The main driver for it right now is the weakening of the dollar. Today in the Asian session the trend continues.
Sincerely, Global FX chief analyst Sergey Melnikov.