On Tuesday stock markets in America showed a positive trend and closed in green zone. Dow Jones up 0.37% (22641.67), S&P 500 up 0.22% (2534.58), the Nasdaq added 0.23% (6531.71). European stock markets also showed growth. TheGerman DAX jumped 0.58% (12902.65), British FTSE 100 gained 0.39% (7468.11).
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 10:55 MSK the Index of business activity in the services sector in Germany in September
At 11:30 MSK the Index of business activity in sector of services of great Britain for September
At 12:00 MSK retail sales in the Eurozone in August
At 15:15 MSK employment Change in U.S. nonfarm from ADP for September
At 17:00 MSK the Index of business activity in the nonmanufacturing sector from ISM for September
At 17:30 MSK oil inventories USA
At 17:30 MSK the Data on excess reserves of oil in Cushing (Oklahoma)
At 20:15 MSK ECB President Draghi speaks
At 22:00 MSK FOMC member Bullard speaks
At 22:15 MSK a Speech fed Chairman Yellen
In Europe negative events continue to develop as the consequences of the referendum in Catalonia. There is a general strike, the local leadership escalates tensions. There are rumors that the President of Catalonia, CarlesPujdeme is going to declare independence. Despite this, all major European indexes rose, including the Spanish IBEX35, which was up 0.02%. Perhaps investors are underestimating the consequences of tension in the Spanish region, which can have a detained effect. And this is happening against the background of local strengthening of the Euro. Producer prices in the Eurozone, published yesterday, can contribute to that, the indicator grew by 0.3%, and that may lead to earlier stopping of QE by European Central Bank. Today on this subject it is expected the statement of the ECB head Mario Draghi.
Tomorrow in America it is scheduled the consideration of tax reform, which promises to reduce contributions to the budget. Investors are in the hope of making new concessions, continue buying in the stock markets, which climb to new heights. Rapid growth continues for the fourth consecutive session. It is likely that after decisions, regardless of the outcome, there will be a correction due to profit taking and reducing positions. Also the country will soon kick off the quarterly reporting season, which promises to bring a lot of positive.
The dollar is weakening, among other factors which contributed to that, is the statement by the head of Minneapolis fed Neil Kashkari, who stated against raising key rates until inflation reaches the target level of 2%. Neil Kashkari is a persistent opponent of the accelerated rate hikes and always talks about it in their statements. Today investors are waiting for more important statements from fed Chairman Janet Yellen.
Last night it was published the API data of weekly change of oil inventories of the United States. There was minus 4.079 million barrels. And it gave a breath to buyers, stopping the acceleration of correction downwards against the backdrop of increasing the supply of oil for 120 thousand b/d by OPEC members. Today it will be published official data of inventories from EIA.
Sincerely, Global FX chief analyst Sergey Melnikov.