On Tuesday, markets of America has not demonstrated a single dynamics and closed mixed. Dow Jones dipped 0.01% (20979.75), S&P 500 dropped 0.07% (2400.67), the Nasdaq rose 0.33% (6169.87). Stock markets of Europe also have had mixed dynamics. TheGerman DAX lost 0.02% (12804.53), British FTSE 100 jumped 0.91% (7522.03).
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 07:30 MSK, industrial production in Japan in March
At 11:30 MSK the unemployment rate in the UK in March
At 11:30 MSK the Average wage including bonuses in the UK in March
At 11:30 MSK the change in the number of applications for unemployment benefits in the UK in April
At 12:00 MSK the consumer price Index (CPI) in the Eurozone in April
At 17:30 MSK crude oil Inventories USA
At 17:30 MSK the Data on excess reserves of oil in Cushing (Oklahoma)
At 21:00 MSK the statement of the representative of the Bank of England MPC Haldane
The main event of the beginning of the week was a visible strengthening of the European currency. The main pair EUR/USD had broken important resistance level of 1.10, and then level of 1.11 was passed also. The next resistance is at the level of 1,113, where possible consolidation and a technical correction will start. The main driver of this rally remains the reaction of investors to the victory of Emmanuel Macron at the elections in France. This event has of key importance for whole Europe, as the choice of development path for several years. Also market participants react to macroeconomic indicators of the region; they came out better than expected by analysts. Today the publication of data will continue, investors will assess data from the UK labour market and consumer prices of the Eurozone.
The contradictory data of American economy were published yesterday. The number of houses built in the previous month amounted to 1.172, which is significantly below the expectations of 1.26. It is the lowest figure since November last year. At the same time, industrial production growth reached 1%, and it is significantly above the forecast of 0.4%. It is possible to see the uncertain behavior of indexes on this background. Yesterday S&P 500 opened with a gap and reaching a maximum during the day closed in a small minus, though above the consolidation of 2400.
Now the main danger to the growth of the US stock market is political uncertainty and scandals around the White House administration and President Donald Trump. The main event of the conflict was the dismissal of the FBI Director, who started investigation of ties between the President and the Russian authorities. Yesterday the congressmen from the Democratic Party require continuing the investigation against the new administration of the White House.
Today in early Asian session, oil is adjusted after publication of data from the American petroleum Institute (API) about the growth of inventories. According to the forecasts it is expected a decline of 2,283 million barrels but instead there was an unexpected increase by 0,882 million barrels. Today will be published data from the US Department of energy. The main event Tuesday was the statement of the IEA, which said that even if an agreement to reduce supply OPEC+ will be extended, then stocks will not achieve to the average level for 5 years.
Sincerely, Global FX chief analyst Sergey Melnikov.