On Wednesday, the stock indices have not shown unified dynamics and closed mixed. Dow Jones grew 0.04% (20957.90), S&P 500 fell by 0.13% (2388.13), the Nasdaq fell 0.37% (6072.55). A similar picture is in European stocks, indices are looking in different directions. Germany's DAX added 0.16% (12527.84), the British FTSE 100 fell by 0.21% (7234.53).
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 04:30 MSK trade balance of Australia for March
At 06:10 MSK Speech by RBA Lowe
At 11:00 MSK Composite PMI Eurozone (PMI) from Markit in April
At 11:30 MSK the Index of business activity in the services sector in the UK in April
At 13:30 MSK the speech of the member of the ECB Lautenslager
At 15:30 MSK the Number of initial applications for unemployment benefits USA
At 14:00 MSK the speech of the ECB Prata
At 17:00 MSK the Volume of industrial orders in the U.S. for March
At 19:30 MSK ECB President Draghi speaks
At 23:25 MSK the President of the Bank of Canada's Poloz speaks
The main event of Wednesday was the publication of the Fed meeting results. The regulator decided to keep the key rate unchanged in the range of 0.75%-1%. In order to support the further improvement of conditions in the labour market and sustainable movement of inflation to the 2% target, monetary policy will be flexible enough. For the appointment of the future size and hike date of the key rate the Fed will consider the results achieved in employment and inflation.
It was also decided to continue reinvesting the income of the portfolio of mortgage and securities. The fed is going to pursue this policy until the interest rate is not normal. This decision was most desirable for market participants, as it will support the currency and awaken the appetite for risky assets. After the publication of this news the price for gold fell to the level of 1235 USD per ounce. The expediency in purchasing the yellow metal disappears due to the persistence in yields of government securities.
Among yesterday's macroeconomic statistics publications it is better to pay attention to the indicator of employment from ADP which came in better than expectations at the level of 177 thousand. But it was far from a revised for the previous month 255 thousand. The Index of economic conditions ISM non-manufacturing sector in April rose to 57.5 from March to 55.2, and was much above the forecasts of 55.8 points.
Today it is scheduled to hold a vote in the Parliament of the United States on the adoption of the law on health care. The administration of the President came to compromise with the conservatives. Previously, the vote was postponed because Trump could not get a majority of his Republican party. For the President the bill as one of the campaign promises.
Reduction in the cost of oil continued. It could not be stopped with the data from the US Department of energy about the reduction of inventories by 2.5 million barrels. One reason for this paradox may be the news that the largest supplier of Saudi Arabia Saudi Aramco announced discounts of up to 70 cents from market prices.
Sincerely, Global FX chief analyst Sergey Melnikov.