Daily Market Reviews by MAYZUS - page 8
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30 October 2013: The Whole World Expects Optimism From FRS Decisions
DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.
The American trading session ended by reaching a new historical maximum. S&P 500 updates it record the third session in a row, whilst NASDAQ is on a maximum level since September 2000. Again, weak statistics have been giving support to the markets, and were pushing indices to go up. Retails in the US decreased in September by 0.1%, when growth of 0.1% had been expected. The index of consumer confidence of Conference Board fell to 71.2 from 79.7.
It is natural that the published statistics are leading investors to buy more before the FRS meeting. The majority of participants of the market don't expect any changes in the volume of the quantitative easing program. It is also worth bearing in mind the prices of houses. The S&P/Case-Shiller index in August showed a rise of 12.8% in prices for residential real estate in 20 main city formations of the USA. The August price grew by +0.9% alone.
The Asian markets are also full of optimism. MSCI Asia-Pacific in Tokyo rose by 0.5%. Industrial production in Japan grew in September. This morning the Nikkei 225 grew by 1.03%, and Shanghai Composite adds 0.76%.
As for the commodity market, Gold is not moving, and seems to be waiting for the FRS decision. Quotations decreased on Tuesday, and this morning Gold is traded on the price of 1346.27$ per troy ounce, adding 0.06%. Even reserves of SPDR Gold Trust didn't change. Oil is also decreasing, the second day in a row, especially Light, having lost 0.44% and is traded on the price of 97.77$ per barrel. Brent is up by 0.12% at a price of 109.14$ per barrel.
Today, it is necessary to pay attention to the following macroeconomic events: unemployment in Germany, indexes of expectations and business climate in the Eurozone, the indicator of employment of ADP Services, data on consumer inflation in the US, data of the Ministry of Energy of the US on stocks, and consumption of oil and oil products. The main event of course, being the results of the FED meeting, which have been awaited by participants of the market for the last two weeks.
Copyright: MAYZUS Investment Company Ltd
01 November 2013: Investors continue To Digest Results Of FED Meeting
DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.
The trading session finished with a small loss in the American stock market on Thursday, having decreased for the second day in a row. Dow Jones decreased by 0.47% and has been trading on the level of 15545.75 points, S&P500 fell to the level of 1756.54 points, losing 0.36%, and Nasdaq Composite lost 0.27% being at the end of the day on the level of 3919.17 points. The main influencing factor has been strong data on the Chicago index of business activity, as for some time now all statistics have been perceived by investors through a prism of prospects of the program of quantitative easing.
Yesterday, investors were waiting for the results of the FED meeting and now continue to digest the results of it, trying to find anything in the text which could outline when the QE-3 program will start to be reduced. A number of large western banks already changed their forecasts in this respect. For example, Credit Suisse considers that the volume of QE3 will be reduced not in March, but in January 2014, by $10 billion, and it is worth waiting for the full turning by September, 2014.
American news does not really seem to be bothering investors in Europe. Yesterday we could observe quite optimistic moods in the European platforms. The German DAX index finished the trading session at the maximum historical level on 9033.9 points, having shown an annual gain of 18.67%.
However, it should be stressed that the situation in the currency market and in particular, the situation with the Euro, strongly changed since the beginning of week. EUR/USD continued to suffer from correction of positions in connection with a difference of views of the national Central Banks on the further course of monetary policy. Macroeconomic statistical data which turned out to be quite weak, only increased uncertainty in relation to the Euro.
Undoubtedly, statements of Mr. Novotna also affected positions of the Euro. Earlier during the week he already managed to excite the markets with the statement that the decrease in the rate on deposits is excluded, and then it gave support to the Euro. This time he made a hint that the European Central Bank could again start to use LTRO operations in order to maintain liquidity at sufficient levels. The regulator really should have a certain plan of action on the future as the current economic indicators show that the process of recovery proceeds unstably.
As a result, the pair from the level of opening on 1.3733 came down to a minimum of 1.3583, having finished the day around 1.36. This morning EUR/USD pair continued it’s downward movement and is traded on the level of 1.35610.
Copyright: MAYZUS Investment Company Ltd
04 November 2013: The Markets Open The Month Having Made A Good Start
DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.
The Dow Jones index raised by 0.45% to 15615.55 points, the gain in a week being 0.3%. The Standard & Poor's 500 index raised by 0.29%, having closed at the level of 1761.64 points, and having gained in a week only 0.1%. The Nasdaq Composite index raised by 0.06% to value of 3922.04 points, having lowered within a week by 0.5%.
On Friday, there was only one important macroeconomic news published across the USA, the assessment of industrial activity in country scales for the last month. The index of economic conditions in the production sphere ISM, counted by the Institute of management of deliveries of the USA in October, grew to the maximum value since April 2011, having reached the level of 56.4 points, when analytics were predicting a decrease to 55.0 points from 56.2 points, the month before. This result became a pleasant surprise, considering the situation we observed in October in connection with the threat of a default. It should be noted that this index, for the 5th month in a row, stays on a level above 50 points, which testifies the increase in the sectors activity. The positive wave of American industrial data was supported by higher than expected growth rates of industrial activity in China, in October.
The commodity market is stagnating and major commodities are showing a down going trend. The price of futures of Gold on Friday fell by 10.50 Dollars or 0.9%, to a value of 1313.20 Dollars per troy ounce. This morning, Gold is traded on a price of 1312.28$. Gold lost in price, due to essential strengthening of positions of the Dollar throughout a basket of world currencies, mainly at the expense of the EUR/USD currency pair. Factor in that the FED, in the final document of the last meeting, didn't exclude the possibility of a reduction of volumes of buying up of assets in the current year, has also been a significant influence in pushing Gold down. In total, Gold for the week lost 2.9%. Due to the decrease in the price of Gold, the world's largest gold-mining company, the Canadian Barrick Gold lost 7.1%, and the leader in the USA, and only a part of S&P 500 index, Newmont Mining, receded by 4.7%.
The price of Brent is on the level of 106.30$ per barrel this morning, Light is on the price of 95.11$. Oil fell in price to the minimum level since June the 21st, due to the strengthening of the Dollar, and continuous growth of its stocks within the last 6 weeks, according to data of the Ministry of Energy of the USA. Following the results of the 4th in a row unprofitable week, "black gold" suffered losses of 3.3%.
The upcoming week is the first week of the new month, and therefore will be saturated with the key macroeconomic releases, capable to have considerable impact on the development in the stock markets and dynamics of the currencies.
Copyright: MAYZUS Investment Company Ltd
05 November 2013: Markets Move Depending On Published Statistical Data
DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.
Yesterday, we did not see any essential changes in foreign stock markets. The American platforms on Monday were trading with volumes which were lower than average. Dow Jones increased by 0.15%, S&P 500 grew by 0.36%, and Nasdaq Composite added 0.38%. Support to the markets was given by R. Fisher's speech, where he negatively expressed his attitude towards political disagreements between republicans and democrats that led to the termination of financing of the budgetary establishments.
In the meantime, Asian platforms bargain in different directions.The Australian ASX200 is doing better than the others, which adds about 0.8%, supported by the news that Reserve Bank of Australia kept the interest rate at the current level of 2.5%. Chinese Shanghai Composite decreases by 0.4%. In the morning data was published on the index of business activity in the services sector according to the HSBC version, which in October grew to 52.6 points. The Japanese market, after a national holiday on Monday, shows sluggish movement, increasing by 0.1% in relation to closing levels on Friday.
It can be assumed that the trading session in the European stock platforms is going to pass rather quietly, due to the fact that there is not a lot of statistical data to be published today. Data of economic moods of the countries of the Eurozone yesterday showed traditionally good results. As it had been expected, the PMI index in the production sector for the region made 51.3 points, having confirmed an initial assessment. The indicator of economic moods of Sentix in November continued growth from 6 to 9 points, reflecting growth of business activity.
As to the important statistical data, today data will be published on the PMI index of Great Britain in the services sector and the Producer Price Index for the Eurozone, which shows a decrease in rates of growth since the end of 2011. In the evening there is also data being published on numbers of ISM Services PMI in the USA. Indexes for the non-productive sphere, most likely, will confirm today the high level of optimism reached within a year.
Copyright: MAYZUS Investment Company Ltd
06 November 2013: Investors are Starting to Look on Facts and Figures
DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.
On Tuesday, the stock market of the United States finished trading session with a small decrease in the main indexes. After the two days growth of an index of the wide market Standard & Poor's 500, investors didn't manage to find motivation to push indexes to go up, quite good macroeconomic statistics didn't rescue the market from prevalence of bears. Let's remind that the index of economic conditions of ISM in the non-productive sphere in October increased from 54,4 to 55,4 points, whereas decrease to 54 was expected.
Participants of the market already overcame the first euphoria after the government of the USA found a compromise and now are starting to look on facts and figures. After a long suspension of work of government agencies in October and decreasing speeds of recovery of American labor market - the investment community has no full picture about state of the economy, and investors are starting to have doubts in, whether the growth of the indexes which we have seen during the last month has been logical.
The external background for the American trading session has been quite negative, as the European markets showed bear dynamics, and Asian platforms were traded in a different directions. Additionally to this more negative has been brought to the markets by comments of the Jeffrey Leker, president of the FRS of Richmond, who has told that the economy of the USA next year will grow only by 2%, then up till the events of October – forecast of to 2,9-3,1% has been predicted.
As a result, Dow Jones Industrial Average went down on 0,13% to level of 15618,22 points, the index of the wide market Standard & Poor's 500 decreased by 0,28% to a level of 1762,97 points, and the index of high-tech industries of Nasdaq Composite went to plus on 0,08% and reached a level of 3939,86 points.
In the commodities market, price for oil continue to fall. Yesterday price for WTI decreased to a price of 93,37$ per barrel and has been losing 1,3%. This morning, prices are recovering and Brent and WTI are adding a bit more than 0,5% bargaining on a levels of 105,90$ and 94,21$ per barrel accordingly.
We shouldn't forget that key events of the current week are going to be meeting of European Central Bank and a release of the last official data on unemployment for October from the Ministry of Labor of the USA. These events will happen on Thursday and Friday respectively, therefore today again activity in stock market will be lowered.
Copyright: MAYZUS Investment Company Ltd
07 November 2013: Meeting Of European Central Bank And Draghi’s Conference Are Key Events of the Day
DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.
Today, some of the key places in the economic calendar are occupied by the meeting of the European Central Bank on monetary policy, and the conference of Mario Draghi after it. This time, it may happen that the head of the Central Bank will prepare the markets for the possible decrease of the rate in December.
The point is that inflationary pressure in the Eurozone at the moment is on 4-year minimum levels, and continues to fall. If the fall is going to continue, it will start threatening the region with a deflation on a Japanese manner. The European Central Bank can't simply stay idle in such situations, and if the regulator will take a decision on further mitigation, it is going to have a significant impact on the Euro. At the moment, the support level is on a price of 1.3480, and it’s breakdown can direct the pair to the area of 1.34. The more we are going to receive positive data from the USA, the more possible it is going to be that EUR/USD will move towards the level of 1.32 within the next few weeks.
American stock markets showed inconsistent dynamics yesterday. The Dow Jones managed to reach a new historical maximum having increased by 0.8% reaching the level of 15746.88 points, supported by growth of stock quotations of oil and gas monsters, Exxon Mobil (+1.3%) and Chevron (+2.7%). Also the computer giant IBM (+1,3%) had some influence. At the same time Nasdaq decreased by 0.20% and finished the trading session on a level of 3931.95 points, S&P 500 increased by 0.43% reaching the level of 1770.49 points.
The Leading Index of the USA published yesterday, showed vigorous lifting by 0.7% having exceeded market expectations, and showed that there is no reason for concern regarding the health of the American economy, at least until the end of this year. In this context, the index of volatility of the American stocks, VIX, fell yesterday to 2-month minimum, having reflected very complacent spirit of investors.
Today, investors will be very cautious before the release of important data from the USA and the decisions of the European Central Bank and Bank of England alike. As a whole, investors expect weak data on gross domestic product and the labor market, which will promote further continuation of the program of quantitative easing in the USA up until spring next year.
Copyright: MAYZUS Investment Company Ltd
11 November 2013: The Markets Stiffened On Uncertainty Where To Move Further
DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.
On Friday, on the stock market of the USA, we observed movement which was almost completely opposite to the movement witnessed by us on Thursday. The majority of liquid papers were growing, and the favourites were hi-tech companies. Dow Jones increased by 1.08% and reached the level of 15761.78 points. Nasdaq added in price 1.60%, and finished the trading session on the level of 3919.23 points, and S&P 500 added 1.34% and reached the level of 1770.61 points.
At the beginning of the trading day, the markets reacted with a downward movement because of the long awaited data published on the labor market, which showed significant growth in the last month. The number of new workplaces in the non-agricultural sector for October jumped up at once to 204 thousand, whilst the average forecast of the market assumed growth only on 126 thousand. Values in the last two months were reconsidered towards the increase in total on 60 000. Unemployment rate was recorded on a level of 7.3% against consensus forecast at the level of 7.4%. Even these statistics managed to push indices down, although during the day officials from the FED managed to calm them by giving promising speeches.
The morning trading session in Asia is not showing the same positive dynamics, the majority of local indices bargain in a minus, only the Japanese Nikkei adding more than 1% because strong data has been published on the account of the current operations of the country, which for the first time in four months showed surplus. It should be noted that there was a small decrease in the Chinese Shanghai Composite Index against, as a whole, quite good weekend data on industrial production - +10.3% against the forecast of 10%, and to retails - +13.3% against the forecast of 13.4%. It seems that investors stiffened waiting for results of the 18th congress of the Communist Party of the People's Republic of China, and didn't react to macroeconomic data.
The situation in the commodity markets is still quite weak. Brent and WTI are traded on a level of 105.32$ and 95.17$ per barrel accordingly, adding in price around 0.2%. Gold is below the level of 1300.00$ and is traded this morning on a price of 1286.22$, adding in price 0.13%. Silver is up by 0.33% on a price of 21.38$ per troy ounce.
Copyright: MAYZUS Investment Company Ltd
12 November 2013: Markets are Reacting Only on Published Statistical Data
DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.
On Monday, the stock market of the United States finished trading session with the insignificant growth of the main indexes. There were not published any macroeconomic statistics in the USA yesterday; besides, in the country Day of veterans was celebrated, and banks were closed, as well as the market of bonds. Respectively, the trading volume at yesterday's session was significantly lower than the usual.
As a result of the trading session - the indicator of blue chips Dow Jones Industrial Average raised on 0,14% to level of 15783,10 points, the index of the wide market Standard & Poor's 500 increased by 0,07% to a level of 1771,89 points, and the index Nasdaq Composite added in price just 0,01% and reached a level of 3919,79 points.
As to the commodities market, then oil is continuing its downward trend. This morning Brent is losing 0,18% and WTI is decreasing for 0,29%, traded on a price of 105,99$ and 95,19$ per barrel accordingly. Precious metals are also losing in price, with gold traded on a level of 1280,45$ per troy ounce and decreasing for 0,05%. Silver is slightly more weak at a price of 21,18$ per troy ounce and losing 0,48%.
In the focus of the market this week are going to be speech of the future head of FED - Janet Yellen in front of Bank Committee of the Senate, and also the reporting of large American retailers. Quarterly report of Wal-Mart Stores Inc. is going to be published on 14th of November, Home Depot Inc will present results on 19th of November.
As for today, then in the second half of day will be published weekly indicator of sales of Redbook which considers sales volume of networks of large shops and hypermarkets in the USA. Moods in the American market are still quite optimistic, all the October’s data published so far can be considered quite positive and better than expectations.
Copyright: MAYZUS Investment Company Ltd
13 November 2013: Investors Continue To Trace Comments Of Official Representatives Of FED.
DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.
On Tuesday, the American market finished the trading session with a small decrease. This week is rather quiet from the point of the publication of macroeconomic statistical data, so the participants of the market are digesting data published last week, taking profit and following speeches by representatives of different regulators.
Yesterday's comments from a representative of FED of Dallas, didn't deceive our expectations. He called recent data from the labor market "quite good", and emphasized that further stimulation of the economy every day bears more and more risks. At the same time, Kocherlakota devoted his speech to the weak condition of the labor market, hinting that it is still too early to speak about turning of monetary easing program. Also, attention can be paid to the speech of Fisher, even though he isn't the voting member of FOMC for the current year, he will acquire a vote in 2014. Today is the expected speech of Sandra Pianalto's, who also doesn't possess a vote in 2013.
As a result, the trading session in the US finished with the Dow Jones Industrial Average index losing 0.21% on a level of 15750.67 points, the index of the wide market S&P 500 went down by 0.24% to level of 1767.69 points, and the index of the hi-tech companies Nasdaq was closed with zero change on a level of 3919.92 points.
The European stock platforms yesterday also appeared to be under pressure from the corporate reporting, leading indexes lost around 0.3-0,6%. Asian platforms began the new day with a decrease, the news background is formed by China where they ended the 3rd plenum of the Central Committee of communist party. Investors estimated meeting results as unclear, prospects of the economy were presented without concrete steps on achievement of goals. The Chinese Hang Seng loses this morning around 0.9%.
Commodities are continuing to fall, even this morning prices for Oil and Gold are managing to win back a bit from yesterday’s losses. Brent is traded on a price of 105.99$ per barrel adding 0.43% and WTI is up by 0.39% at 93.89$ per barrel. Gold is at price of 1274.59$ per troy ounce and wins 0.26%, and Silver oppositely loses 0.06% and is traded on a price of 20.76$ per troy ounce.
Copyright: MAYZUS Investment Company Ltd
14 November 2013: Indices Of The US Updated Historical Maxima On Yellen’s Statements
DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.
Stock indices of the US updated historical maxima on positively apprehended reports on Macy's, and expectations of the continuation of monetary easing stimulus after Janet Yellen's appointment. As a result, the trading session in the USA finished with the Dow Jones adding 0.45% and being traded on a level of 15821.63 points. S&P 500 increased by 0.81% and reached the level of 1782.00 points, and Nasdaq added in price 1.17% traded on the level of 3965.57 points.
Such a strong, positive effect on the market was brought by vice-chairman of the FED, Janet Yellen, who is now considered as the savior of the American market. She considers that the economy and the labor market show growth, which is much weaker than the potential. Therefore, until the economy will gain strength, the FED will continue the stimulating policy. Respectively, "strong restoration is a necessary condition to start folding of not conventional measures of FED, as program of repayment of assets", as stated in the prepared text for her press-conference, which will take place tomorrow.
The reaction of Asia to Yellen's words was also very positive. MSCI Asia-Pacific grew by 1.2%. The Japanese market also received an additional incentive in the form of a preliminary estimate of gross domestic product for the III quarter. National economy grew by 1.9% at consensus of economists of 1.7%, but much more slowly than in the II quarter when growth rates made 3.8%. Nikkei 225 grew by 2.39%, and Shanghai Composite by +0.45%.
Another interesting and positive development was observed in the commodity market. Where Brent is increasing by 0.07% this morning, and reached level of 106.97$ per barrel, WTI is flat at the price of 94.48$. At the same time, Oil still appears under pressure of statistics of stocks in the USA. American Petroleum Institute reported that during last week, commercial stocks of Oil increased by 0.6 million barrels, stocks of gasoline decreased by 1.67 million barrels and distillates grew by 0.6 million barrels.
Prices for precious metals finally took revenge after continuing fall for a few days. Gold is up by 1.15 % and Silver by 1.79%, traded on the price of 1283.04$ and 20.81$ accordingly. It should be noted that Gold has ideas for purchase, namely mitigation of policy of the European Central Bank, and also the statements from the FED representatives that the super soft policy is still far from an end. Therefore it is quite obvious there will be some rebound on yellow metal.
In the second half of the day, investors and speculators will be guided by the character of statistics coming from the USA. Weekly data on the number of primary demands for unemployment benefits will be considered as the most important signal.
Copyright: MAYZUS Investment Company Ltd