Yesterday Stock indices of the United States showed no single dynamics and closed mixed. Dow Jones lost 0.16% (20943.11), S&P 500 added 0.11% (2399.63), the Nasdaq rose 0.14% (6129.14). European stock markets showed a slight growth dynamics. The German DAX climbed 0.07% (12757.46), British FTSE 100 down 0.59% (7385.24).
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 00:00 MSK interest rate Decision
At 00:00 MSK statement by the Reserve Bank of New Zealand
At 04:10 MSK a Speech of the Chairman of the Reserve Bank of New Zealand Wheeler
At 11:30 MSK the Volume of production in the manufacturing industry in the UK in March
At 12:00 MSK the Economic forecasts of the EU
At 13:25 MSK FOMC member Dudley speaks
At 14:00 MSK the Bank of England Report on inflation
At 14:00 MSK interest rate Decision for May
At 14:00 MSK the minutes of the meeting of the Committee on monetary policy of great Britain
At 14:00 MSK Monthly report, OPEC
At 15:30 MSK the producer price Index for April
At 15:30 MSK the Number of initial applications for unemployment benefits USA
At 19:30 MSK the speech of the ECB representative Pratt
After euphoria associated with the victory of Emmanuel Macron to the presidential elections in France, stock markets have stood on pause. Investors overestimate the risks and watch for further developments of events. In this regard, the volatility of European stocks has decreased significantly at levels close to the local highs. However, the factor of political uncertainty has gone for now, which creates certainty for the next few years and clear the course of development of the region. Thus interest in protective assets is decreased. Demand for Gold falls, market participants are exiting from long positions.
In his speech yesterday, ECB President Mario Draghi spoke about the advisability of extending stimulus measures in monetary policy. Against the background of such sentiments of regulator, market participants have decided to reduce positions in the Euro, as result the pair EUR/USD has gone down to 1.086. The probability of a correction in the pair is kept with the indicative target of 1.075.
The U.S. market responded weakly to the dismissal of FBI Director James Comey. There was a gap down at yesterday's opening which was closed during the trading session. Positive data of the economy and from labor market reduced the effect of political uncertainty created by President Trump. The index of wide market S&P 500 is trading near all-time highs.
Also the buying mood is reinforced by successful period of corporate reporting. Nvidia has increased the capitalization for 14.3% on the background of the results exceeding expectations. The cost of another high-tech company Electronic Arts soared by 13.9% due to revenue report of $1,53 billion, which was above forecasts.
Yesterday, the EIA published data of the state of oil inventories for the previous week. The decline amounted to 5.247 million barrels instead of the predicted 1.786 million barrels. This news gave an additional reason for buying. The rising of black gold cost has started from beginning of week; it was fueled with expectations of renewal of the Vienna treaty of OPEC+ for a period longer than until the end of the year. Today, investors will follow the publication of the monthly report of OPEC.
Sincerely, Global FX chief analyst Sergey Melnikov.