On Wednesday, the US stock markets showed a single weak growth dynamics and closed positively. The Dow Jones added 0.18% (21173.69), S&P 500 rose by 0.16% (2433.14), the Nasdaq rose by 0.36% (6297.38). In contrast to the U.S. European indexes were down to a single speaker. The German DAX slipped 0.14 %(12672.49), British FTSE 100 fell 0.62% (7478.62).
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 Japan's GDP for the first quarter
At 09:00 MSK the Volume of industrial production in Germany in April
At 11:16 MSK the Volume of construction of new homes in Canada in may
At 12:00 MSK Eurozone GDP for the first quarter
At 14:45 MSK the Rate on Deposit facility in the Eurozone
At 14:45 MSK interest rate Decision in the Eurozone in June
At 15:30 MSK Press conference of the ECB
At 15:30 MSK the Number of initial applications for unemployment benefits USA
At 18:15 MSK the President of the Bank of Canada's Poloz speaks
The news about the purchase by Spanish Bank Santander of troubled Bank Banco Popular for one Euro was positively received by the market and contributed to the retention indexes of the Eurozone from a heavy fall. At tomorrow's ECB meeting in Tallinn the further policy of the regulator will be determined. Yesterday on rumors of a possible lowering of the forecast for the growth rate of prices has increased volatility Euro. Now many players expect a gradual reduction of stimulus measures while the rumors suggest otherwise.
At the same time, the British market is reduced from the beginning of the week for the third consecutive session. Investors are reducing risk and fixing profit of long positions in anticipation of early parliamentary elections. Among market participants there is hope that the Conservative party will increase its presence.
In the United States important political events are also expected. The Senate hearings of the former Director of the FBI James Komi will be today. It is possible that he will make statements about Russia's intervention in the election race in the United States. Such developments could undermine the reputation of the current President and turn the markets down. Also macroeconomic data will be released today from the labor market, which will influence the determination of the fed's policy at the upcoming meeting next week.
The tense situation around the Qatar caused speculative reaction of the markets. Yesterday a strong factor for sales was the EIA report for crude oil inventories in the United States. According to the official inventories increased by 3,295 million barrels, while the expected decline of 3,464 million barrels. The fall in the price of futures contracts reinforced the message from the API on the eve of a significant reduction in stocks, which gave occasion to shop for a substantial amount, which it was urgent to sell on data from EIA. In this regard, much has gone down and paper of companies in the oil sector of the USA. Exxon Mobil dipped by 0.75%, the capitalization of ChevronTexaco fell by 1.29%, Marathon Oil declined by 5.59%.
Sincerely, Global FX chief analyst Sergey Melnikov.