Daily Market Reviews by MAYZUS.com

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08 January 2014: Investors Waiting For The Protocol Of Last FOMC Meeting

 

DAILY MARKET REVIEWS

By Kristina Leonova: Analyst in Portfolio Asset Management Department.

 

Yesterday’s trading session was a victory for the "bulls". In Europe, the index of the Parisian stock exchange, CAC 40, grew by 0.83%, as well as the German DAX, and the index of the London stock exchange FTSE 100 added 0.37%. In the meantime in the US, the Dow Jones indicator increased by 0.64% up to the level of 16530.94 points, the S&P 500 rose by 0.61% and reached the level of 1837.88 points, and Nasdaq gained 0.96% and reached the level of 4153.18 points.

 

This morning, the American futures bargain in a weak plus, the futures contract on S&P 500 adds 0.12%. Almost all the main indicators of the Asian-Pacific Region are also trading in the green zone, for example, Japanese Nikkei 225 adds 1.93% and the Hong Kong Hang Seng increases by .18%.

 

Today it is necessary to pay special attention to the publication of the protocol of the last meeting of FOMC. This event is quite interesting to observe, due to the fact that at the last meeting, the representatives of the Committee decided on the long-awaited beginning of the turning of the QE3, however, having designated only symbolical reduction of stimulation. Thus, details of adoption of such a decision can be quite interesting and exciting for the market. If investors will see high motivation of the monetary authorities, and also readiness for further more considerable turning, it could increase demand for the American Dollar. Such an outcome is spoken of highly by many factors - the recent aggressive speech of Plosser and also Bernanke's comments that there is an opportunity of reduction of the program at each meeting.

 

However, there is a small probability that the members of the FOMC were taking this decision without significant willingness, especially, remembering that the managing director of the FED of Boston, Rozengren, acted against it, referring to a very high unemployment rate and to low a rate of inflation.

 

As for the EUR/USD currency pair, besides the minutes of the FOMC, has other factors of pressure. Deflationary tendencies in the Eurozone are causing more and more fears in the monetary authorities of E-17, as they obviously point to a lack of final consumption. In spite of the fact that the current economic situation in some peripheral countries starts being corrected, Italy and France considerably slows down the development. In this plan, it will be interesting to look at Mario Draghi's press-conference right after the meeting of the European Central Bank, planned for Thursday. Whether there will be hints on a deflation, and ways of fight against it, remains a riddle.

 

The influence from it we will be able to see on Thursday, but today the EUR/USD will move under the influence of the publication of the report on industrial orders of Germany, and also results of the FOMC protocol. If the protocol appears to be more positive than expected, it could send the pair to the area of 1.3550.

 

Brent is up by 0.29% on a level of 107.30$ per barrel. WTI is increasing by 0.51% and traded on a price of 94.32$ per barrel. Gold and Silver are losing 0.28% and 0.88% accordingly, bargaining next to the levels of 1226.06$ and 19.61$ per troy ounce.

 

Copyright: MAYZUS Investment Company Ltd

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09 January 2014: ECB Meeting Will Outline Views Of The Authorities On The Situation In Europe

 

DAILY MARKET REVIEWS

By Kristina Leonova: Analyst in Portfolio Asset Management Department.

 

The FOMC protocol met our expectations, and gave the currency market even more confidence that Ben Bernanke's prophecy will come true, and reduction of incentive will be carried out at each subsequent meeting of the FED. This news gave support to the USD, and pushed its main competitors down, the result being the EUR/USD reaching the level of 1.3550, and traded this morning on a price of 1.3595. GBP/USD was pushed away from maximum levels to the area of 1.6440.

 

Dow Jones industrial average lost 0.41%, and reached the level of 16462.74. Nasdaq added 0.26% and finished the trading session on the level of 4163.88, and the S&P 500 weakened by 0.02%, to the level of 1837.49 points.

 

In Europe yesterday, there was quite a lot of macroeconomic statistical data published, the surplus of trade balance of Germany didn't hold to market forecasts in November, and made 17.8 billion Euros against the consensus forecast of 18.0 billion Euros. November industrial orders of the country, on the contrary, increased by 2.1%, having surpassed forecasts of analysts of 1.5%. The Eurozone retails in November recorded an increase of 1.4%, and the Eurozone unemployment rate in November didn't change, making 12.1%, as expected.

 

Today, the European Central Bank will hold the first meeting on the interest rate in the current year, and in spite of the fact that we don't expect any changes in monetary policy, it will be very interesting to look at how the authorities estimate the current situation. On one hand, weak inflationary pressure becomes more dangerous every day, however, on the other hand, the position of Germany is getting more stable. We would like to remind you that in November, low CPI became the basis for the reduction of the interest rate of the European Central Bank. Since then, falling only continued: the indicator makes, at present, 0.8%, instead of the target level of 2%. Today, everything will depend on the placed accents: if the authorities will claim that the German growth will be sufficient to stimulate restoration of inflationary pressure, it will bring a sense of positivity to the European platforms.

 

Special attention should also be paid to the unemployment figures coming from the USA.

 

Copyright: MAYZUS Investment Company Ltd

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10 January 2014: Negative Moods Prevail In The Markets

 

DAILY MARKET REVIEWS

By Kristina Leonova: Analyst in Portfolio Asset Management Department.

 

On Thursday, key stock indices of Europe showed negative dynamics due to the statements of Mario Draghi. Besides that, investors’ decisions were influenced by the last protocols of the last meeting of the FOMC, which contained obvious hints on turning of the program of quantitative easing.

 

It should be noted that yesterday, the European Central Bank and Bank of England kept monetary policy unchanged, thus, according to Mario Draghi, rates will remain at a low level for a long time, but as for the present it is too early to say that the Eurozone is out of danger. Draghi also emphasized that unemployment remains at a high level, and dynamics in the sphere of crediting is still rather weak.

 

As a result, the main European stock indices finished the trading session with Great Britain's index (the FTSE 100) losing 0.5%, the French of CAC 40 became 0.8% easier, and the German DAX went to a minus also by 0.8%. The regional STXE 600 indicator, in turn, decreased by 0.4% and was closed on a level of 328.41 points.

 

Currency markets were also influenced by presented data and statements, which added to the strengthening of the Dollar. After the press-conference after the ECB meeting, we first saw further strengthening of the EUR/USD to a maximum of 1.3632, and then witnessed a kickback to a minimum at the level of 1.3548, ending the trading day around 1.3580. At the present time, the currency pair is traded on a level of 1.35988 and its further development can be influenced by the labor market figures today, if they are going to be positive. The next purpose of the pair is on 1.3550 and further on 1.35.

 

Nevertheless, today it is necessary to pay an attention to the data on the labor market, which will be published in the second part of the day. Forecasts suggest that employment in the nonagricultural sector of the US is supposed to increase approximately by 200 thousand, and unemployment should remain at the former level of 7%. And last, but definitely not least, the factor bringing negative vibes to the markets has been the start of the season of corporate reports. Alcoa did not justify forecasts, the next in line to report are the banks.

 

Copyright: MAYZUS Investment Company Ltd

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13 January 2014: The Markets Cannot Find Their Feet After Winter Holidays

 

DAILY MARKET REVIEWS

By Kristina Leonova: Analyst in Portfolio Asset Management Department.

 

For the first days after New Year's vacation, leading stock markets of the world show quite weak activity. Even publications of important macroeconomic indicators cannot push indices to start forming trends in one way or another, neither in the US, Europe, nor in emerging markets. Important indicators, which will be able to have an influence on the market, will be the statistics on industrial production of the Eurozone on Tuesday, and new data from the real estate market in the US on Friday. Besides that, American companies already begun the reporting period for the fourth quarter of the previous year, which could lead to an emergence of volatility in the markets.

 

On Friday, the statistics of the labor market in the US recorded a minimum level of unemployment in the country for the last five years. The coefficient fell from 7% last month to 6.7% in December, which increases the probability of further reduction of the program of monetary stimulation at the next meeting of the FED at the end of January. At the same time, the quantity of created workplaces for the same period was much lower than expectations, and made only 74 thousand, which was the minimum level for 2013.

 

For the last three years, the economy of the US created about 2 million workplaces, but at the same time, the unemployment rate remains quite high. It is worth remembering that the desirable unemployment rate, at which the FED could go for a rate increase, is on the level of 6.5%. The second indicator for the FED is the inflation, data on which is going to be published on Wednesday and Thursday.

 

As a result, the last trading day of the week finished with the Dow Jones industrial average index decreasing by 0.05% to 16437.05 points, retreat in a week made 0.2%. The Standard & Poor's 500 index raised 0.23%, having closed at the level of 1842.37 points, the increase in a week made 0.6%. The Nasdaq Composite index raised by 0.44% to the value of 4174.66 points, having added 1% within the week.

 

The price of futures of gold raised by 1.4% to the value of 1246.90$ per troy ounce, traded this morning at the level of 1249.20$. Gold rose in price, owing to the dollar weakening, and the dominating confidence of investors that weak data on growth of employment, will not allow the FED to continue further reduction of QE3. In total, gold lost 0.7% in a week.

 

Oil increased in price as a result of the retreat of the dollar, and against growth of the Chinese import in December. The price of futures of WTI raised by 1.2% to level of 92.72$ per barrel, traded this morning at 92.57$. Brent is down by 0.13%, at 106.47$ per barrel. Last week was the second unprofitable week in a row for oil prices.

 

Copyright: MAYZUS Investment Company Ltd

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14 January 2014: Decrease Noted On World Platforms During Yesterday’s Trading Session

 

DAILY MARKET REVIEWS

By Kristina Leonova: Analyst in Portfolio Asset Management Department.

 

During yesterday’s trading session, the American players preferred to take profit from the majority of stocks before the publication of the results of the large banks for the fourth quarter of 2013. Growth of some stocks by 25-30% last year in many respects could be considered as an advance, and fears that reports will not be able to meet expectations, forced the participants of the market to take a third-party position, and take profit.

 

As a result, the Dow Jones on Monday lost its maximum level of 1.10% since 20th of September, reaching the level of 16257.94 points.The S&P went back to the levels of the middle of December, decreasing by 1.26% to the level of 1819.20 points, and Nasdaq Composite decreased by 1.48% to the level of 4113.30 points.

 

In comparison to the American indices, the European indices spent the day in a boring side trend, however managed to close the trading session with a small increase. Important statistics in the region were not published, however there were no reasons for sales either. Following the results of the day, the index of the London stock exchange FTSE100, increased by 0.26%, the French CAC40 added 0.3%, and the German DAX appeared in a plus for 0.39%.

 

This morning, the main indices of the Asian-Pacific region, following the American trading session, show, in general, negative dynamics. The exception being the Chinese Shanghai Composite, adding 0.86%. The Japanese Nikkei fell upon 3.07%, the Korean KOSPI lost 0.24%, and the Hang Seng decreased by 0.45%. Today in Japan, data on trade balance for the November period in 2013 has been published, which showed record deficit, which caused such a steep correction.

 

During the day, the attention of investors will be concentrated on news coming from the US and the published data on retails, which will help participants to understand more deeply the current development of the economy in the USA. This data could cause increasing volatility on the currency market and influence further decrease in the stock market.

 

Copyright: MAYZUS Investment Company Ltd

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15 January 2014: Macroeconomic Data And Quarterly Reports Of Companies Are Bringing Positives On The Markets

 

DAILY MARKET REVIEWS

By Kristina Leonova: Analyst in Portfolio Asset Management Department.

 

Yesterday, the American trading session finished on a positive note. Firstly, retails in the USA for December grew by 0.2%, at expectations of an increase of 0.1%. It is a very important indicator of the situation in the US economy, as the consumer demand makes about 70% of the gross domestic product of the country. Obviously, investors did not leave such a positive factor aside.

 

Statements from the representatives of the FED didn't spoil the mood of investors, and indices continued their growth. The president of the FED of Philadelphia, Charles Plosser, believes that the monetary easing program has to come to an end within the current year, as the economy steadily moves towards restoration. The president of the FED of Dallas, Robert Fisher, also considers that the quantitative program has to be completed, as it is similar to beer alcoholism, whereby everything is seen through rose tinted glasses. "We already reached a condition of intoxication", he stated.

 

As a result, the Dow Jones increased by 0.71% up to the level of 16373.86 points. The S&P 500 added 1.08% finishing the trading session on a level of 1838.88 points, and Nasdaq Composite grew by 1.69%, up to the level of 4183.02 points.

 

Additionally, on the positive side, the World Bank raised forecasts of growth rates of the world economy yesterday. According to Bank forecasts, growth of the world economy will make 3.2% against the previous forecast of 3%. I would like to remind you that in 2013, the world economy grew by 2.4%. Optimism of the World Bank is connected with the improvement of the situation in Europe and the USA.

 

However, the situation in the commodity markets is not so positive. Oil prices and prices of precious metals continue to fall. Brent is down by 0.16%, to the level of 105.43$ per barrel, and WTI is decreasing by 0.09%, to the level of 92.7. Gold and silver prices are down by 0.37% and 0.70% accordingly, traded on a price of 1240.69$ and 20.14$ per troy ounce.

 

During the day, macroeconomic statistics will continue to be published, and reports of regulators on the state of the economy, which could have an impact on moods of the world markets. Among the most important, it is beneficial to note gross domestic product of Germany, the index of production activity of the USA, the price index of producers of the USA, and the monthly regional report "Beige book". Besides that, investors will follow the release of reports from the American companies, among which, is Bank of America, reporting today.

 

Copyright: MAYZUS Investment Company Ltd

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16 January 2014: The Success Of The Banking Sector Promotes Growth Of Indices

 

DAILY MARKET REVIEWS

By Kristina Leonova: Analyst in Portfolio Asset Management Department.

 

European stock markets had a rather positive trading session yesterday, the German DAX increased by 2.0%, having reached a new historical record point. The economy of Germany looks forward with optimism, and, according to forecasts of the German Central Bank, gross domestic product of Germany will grow this year by 1.7% and by 2% in 2015.

 

Among the favorites of growth yesterday in the European stock market, were shares of banks such as Deutsche Bank, adding 3.1% in value, and Commerzbank, increasing by 3.0%, added on expectations of the announcement by the European Central Bank of parameters of the stress tests, which carried out, will hopefully increase trust in the European banking system.

 

The increase of forecasts on growth rates of the world economy by the World bank, and also the rise in price of shares of stocks in the banking sector, alongside the inspiring report of Bank of America, gave support to the American market.

 

From yesterday's published macroeconomic statistical data, it is possible to note the increase in the Producer Price Index in December by 0.4%, as it was predicted by the market. At the same time, oil stocks for the past week were reduced, according to EIA, on 7.658 million barrels, whereas analysts expected a decrease in stocks by only 0.613 million barrels.

 

As a result, the indicator of "blue chips", the Dow Jones Industrial Average index, got stronger by 0.66% and was closed on a level of 16481.94 points, the index of the wide market S&P 500 went to a plus by 0.51% to level of 1848.38 points, and the index of hi-tech companies, Nasdaq, recovered by 0.76% to the level of 4214.88 points.

 

Papers of the banking sector were, for investors, in special demand. Shares of the second biggest creditor in the USA, Bank of America, rose in price by 2.3% after it reported more than a quadruple increase in the quarterly profit, which absolutely surpassed forecasts of analysts. Quotations of Wells Fargo & Co and JPMorgan Chase & Co grew, in turn, by 1.8% and 3% respectively. Among the favorites of the trading session was also the American corporation, Apple, which market capitalization increased by 2% due to a statement given by China Mobile, which confirmed that advanced orders of the iPhone reached 1 million units.

 

The is one more important test ahead– the publication of the report of CPI reflecting inflationary tendencies in consumer level. This index needs to confirm a rise in prices in order to convince representatives of the FED of the possibility of further cutting the monetary easing program. If the numbers show amplifying inflationary pressure, it will mean that the American consumer will be able to overcome any short-term uncertainty, and will continue to spend their savings.

 

Copyright: MAYZUS Investment Company Ltd

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17 January 2014: Investors Don't Rush Their Decision-Making

 

DAILY MARKET REVIEWS

By Kristina Leonova: Analyst in Portfolio Asset Management Department.

 

Yesterday, the trading session in the main European stock platforms passed rather quietly, and the main focus of the participants of the market was on statistical data, which mostly coincided with forecasts of analysts. Final data on the consumer price index of Germany was presented for December, which, as expected, increased by 0.4%. Meanwhile, the similar indicator on the Eurozone grew by 0.3%, also having coincided with market forecasts.

 

As a result, the key index of Great Britain, the FTSE100, went down by 0.07%, the French CAC40 lost 0.3%, and the German DAX went to a minus by 0.17%. The regional STXE 600 indicator, in turn, decreased by 0.2% and was closed on a level of 333.99 points.

 

As for the macroeconomic statistics published in the United States, in general, it was of a neutral character. Data on inflation for December corresponded to average market forecasts, the consumer price index, taking into account seasonality, grew by 0.3%, and the basic indicator of inflation added 0.1%. Furthermore, the number of primary requests for unemployment benefits for the past week practically coincided with the forecast, having decreased from the reconsidered 328 thousand, to 326 thousand. Finally, the index of business activity of the FED of Philadelphia in January, made 9.4 points, when 8.6 points were forecast.

 

Following the results of the session, the indicator of blue chips, Dow Jones Industrial Average, went down by 0.39% to the level of 16417.01 points, the index of the wide market, Standard & Poor's 500, decreased by 0.13% to the level of 1845.89 points, and the index of high-tech industries of Nasdaq Composite went to a minus on 0.09% and reached the level of 4218.69 points.

 

In the commodities market, the situation seems to be stabilizing. The price for Brent is increasing by 0.23% and is on a level of 105.99$ per barrel. WTI is up by 0.52% on a level of 94.59$. Gold and silver are adding 0.18% and 0.13% accordingly, traded on the levels of 1242.44$ and 20.08$ per troy ounce.

 

Expectations of the continuation of the reduction of the program of quantitative easing, give support to the Dollar, and during the continuation of active discussions on this subject, the attention of investors is concentrated on speeches from the heads of the regional FED. Today, the report on the situation of the economy is going to be made by the president of the FED of Richmond - Jeffrey Lacker.

 

Copyright: MAYZUS Investment Company Ltd

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20 January 2014: Sluggish Day Ahead Due To Lack Of Statistics, And The Celebration Of Martin Luther King Day In The U.S.

 

DAILY MARKET REVIEWS

By Kristina Leonova: Analyst in Portfolio Asset Management Department.

 

On Friday, the American stock indices couldn't decide where to move. The Dow Jones Industrial Average index was closed with an increase of 0.25% and reached the level of 16458.56 points, and at the same time, S&P 500 and Nasdaq Composite, following the results of the trading session, decreased by 0.37% and 0.49% respectively, traded on a level of 4197.58 and 1838.70 points. Today, the stock exchanges of the US are closed due to the celebration of a national holiday - Martin Luther King Day. Thus, the main attention of investors will be riveted on dynamics in Asia and Europe.

 

The published reports of the companies were ambiguous. The reporting of GE and Intel disappointed, whereas American Express, Visa, and Morgan Stanley shares grew after an exit of figures. The index of consumer moods of Michigan university in January decreased to 80.4 points, which was worse than the forecast of 83.5 points. In December, the quantity of new buildings was reduced by 9.8% compared to the last month, and here the result was also worse than the forecasts.

 

This morning, data was presented on the condition of the Chinese and Japanese economy, which were again a little weaker than expectations, which caused a small negative at the trading session in the Asian region. Annual growth of China decreased from 7.8% to 7.7% in the fourth quarter, in quarterly expression the gain of gross domestic product decreased from 2.2% to 1.8%. Industrial production in annual expression fell from a level of 10% to 9.7%, and investments into fixed capital of China were reduced from 19.9% to 19.6%. In the industrial sector of Japan, we also observe deterioration. The latest data for January showed a decrease in industrial production by 0.1%.

 

The Commodity market is flat, oil prices this morning are down by 0.11% on Brent, and 0.68% on WTI, traded on a level of 106.36$ and 93.94$ per barrel accordingly. Gold is up by 0.23% on 1254.87$ per troy ounce, and silver is increasing by 0.02% on a level of 20.31$ per troy ounce.

 

Copyright: MAYZUS Investment Company Ltd

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21 January 2014: The Banking Sector In Europe Is Under Pressure

 

DAILY MARKET REVIEWS

By Kristina Leonova: Analyst in Portfolio Asset Management Department.

 

In absence of the American players on Monday, the European stock indices finished the trading session without any significant development.

 

From the macroeconomic statistics published yesterday, it should be noted that the price index of producers of Germany for December grew by 0.1%, at average forecasts of 0.0%. Thus, in comparison with data from the similar time period last year, decrease of the indicator made 0.5%, as expected.

 

As a result, the index of Great Britain, FTSE 100, increased by 0.11%, French CAC40 lost 0.11% and the German DAX went to a minus by 0.28%. The regional STXE 600 indicator, in turn, decreased by 0.1% and was closed on a level of 335.5 points.

 

Worse off than the other sectors of the market were shares of the banking sector. So, the shares of Commerzbank, Credit Suisse and ICAP decreased by 4.5%, 2.5% and 4.3% respectively. Additionally to that, market capitalization of the largest creditor of Europe, Deutsche Bank, decreased by 5.4%, after it reported that the loss before payment of taxes in the fourth quarter made 1.15 billion Euros. Analysts, in turn, predicted profit at the level of 628.5 million Euros.

 

The background this morning looks rather positive: futures for the American indices add 0.5%, bull moods prevail in the Asian-Pacific, with Japanese Nikkei increasing by 1.4%, the Hong Kong Hang Seng adds 0.6%, and the Chinese Shanghai Composite grew by 0.7%. The positive situation is mainly due to the statement from the Bank of China, and their willingness to provide additional liquidity to small and large banks of the country.

 

The situation on the commodities market also remains the same, and there have not been any strong changes for the last few days. Brent is increasing by 0.19%, traded on a level of 106.55$ per barrel, WTI is down by 0.34%, on a level of 94.27$ per barrel. Gold adds in value 0.02%, traded on the level of 1252.10$ per troy ounce, and silver is down by 0.49% at the level of 20.20$ per troy ounce.

 

In America, the large banks already published their reports, and this week, the market focus will be on papers of the hi-tech companies and retailers. Figures from Microsoft, IBM, Starbucks and Netflix are expected. Today, Johnson & Johnson and Verizon will publish reports. As for the most important statistics today, it is worth paying attention to the publication of the index of activity of ZEW across Germany, whereby a decrease from 62 points to 61.5 points is expected.

 

Copyright: MAYZUS Investment Company Ltd

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22 January 2014: The IMF Increased Forecasts On GDP

 

DAILY MARKET REVIEWS

By Kristina Leonova: Analyst in Portfolio Asset Management Department.

 

The International Monetary Fund raised forecasts on growth rates of the world economy for the first time in the last two years, however, emphasized that the richest and most developed countries develop at the present moment with slower rates than they actually could. Besides, the IMF noted that deflationary risks remain to be on a high level.

 

According to the updated estimates, world gross domestic product will increase by 3.7% in the current year, and then by 3.9% in 2015. We will remind you that in October, the growth of the world economy in 2014 was expected to be on a level of 3.6%. The IMF also improved the forecast for the USA from 2.6% to 2.8%, for China from 7.2% to 7.5%, and for Germany, from 1.4% to 1.6%.

 

Following the results of the trading session, the indicator of "blue chips", the Dow Jones Industrial Average index, was closed with a minus of 0.27% on the level of 16414.44 points, the index of the wide market S&P 500 increased by 0.28% to the level of 1843.80 points, and the index of the hi-tech companies, Nasdaq, grew by 0.67% to the level of 4225.76 points.

 

As for the European stock markets, the British FTSE 100 was reduced by 0.04%, the French CAC40 increased by 0.02%, and the German DAX got stronger by 0.15%. The regional STXE 600 indicator increased by 0.1%, having closed on a level of 335.76 points.

 

The indicator of economic moods in the Eurozone from the results of research carried out by the German institute ZEW, in January, grew to 73.3 points from 68.3 points in December. The same indicator for Germany, according to ZEW estimates, increased in January from 32.4 points a month earlier, to 41.2 points, whereas analysts expected 34.1 points.

 

The price of WTI oil, following the results of the day on NYMEX, raised by 0.4% to the level of 94.97$ per barrel, and is continuing its growth today and increasing by 0.54% to the level of 95.66$ per barrel. Brent is up by 0.54%, traded on a level of 107.30$ per barrel. The prices of gold and silver are flat, with gold trading on a level of 1241.30$ per troy ounce, and silver bargaining next to the level of 19.89$ per troy ounce.

 

Copyright: MAYZUS Investment Company Ltd

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23 January 2014: Consolidation Proceeds In The Markets

 

DAILY MARKET REVIEWS

By Kristina Leonova: Analyst in Portfolio Asset Management Department.

 

Since the beginning of the week, at the key European and American exchanges, there has not been anything interesting happening. Yesterday, stock indices were moving in different directions, but in general they are consolidating next to the maximum levels of the last year. Optimistic forecasts regarding improvement of the economy of the developed countries this year, haven't given investors a reason to transfer to safer instruments, like gold or treasury bonds. The attention of the market is directed towards the upcoming meeting of the FED, which is going to be next week.

 

Yesterday’s trading session in Europe came to an end with multidirectional movement of indices. The interest of investors was down to statistics on the labor market of Great Britain, the indicator made 7.1% instead of the expected 7.3%, however this data was not supporting indices for a long time. By closing, the English FTSE100 index decreased by 0.12%, the French CAC40 grew by 0.03%, and the German DAX decreased by 0.1%.

 

In the USA, indices also couldn't show uniform dynamics, buyers nevertheless prevailed. Dow Jones decreased by 0.25% to the level of 16373.34 points, S&P 500 grew by 0.06% reaching the level of 1844.86 points, and Nasdaq Composite grew by 0.41% to the level of 4243.00 points.

 

Data published this morning from China brought disappointment to the markets. The PMI index for the production sphere, counted by HSBC bank in January, fell to a level of 49.6 points, which is significantly weaker than the forecast of 50.3 points. Business activity in the country showed the first decrease for the last 6 months. Naturally, on Thursday morning, the markets reacted to this news negatively, and pushed Asian stock indices to go down, with Nikkei loosing 0.65%, ASX falling by 1.1% and CSI decreasing by 0.6%.

 

Prices of oil managed to restore some loses and are showing positive dynamics. The international Power Agency raised the forecast of world consumption of oil to 1.3 million barrels per day. This morning, Brent is traded on a level of 108.25$ per barrel, WTI is up by 0.10% on the level of 96.83$ per barrel.

 

Today, investors attention will be on statistics from Europe, where the data on the index of business activity in the industry and the services sector of Great Britain and the Eurozone, is going to be published. In the USA, payrolls for the last week, and data on oil stocks will be presented later on throughout the day.

 

Copyright: MAYZUS Investment Company Ltd

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24 January 2014: Markets Are Planning Correction Before Meeting Of FED

 

DAILY MARKET REVIEWS

By Kristina Leonova: Analyst in Portfolio Asset Management Department.

 

Yesterday, the main stock indices of the USA were traded in negative territory. During the day, data was presented from the National Association of Realtors (NAR) on sales of houses in the secondary market, which showed that they did not change in December. According to the report, sales of existing houses grew in December by 1.0% in comparison with last month, having reached an annual level of 4.87 million units, when an increase to the level of 4.99 million units was forecast.

 

Following the results of the trading session, the indicator of blue chips, Dow Jones Industrial Average, went down by 1.07% to the level of 16197.35 points. The index of the wide market Standard & Poor's 500 decreased by 0.89% to a level of 1828.46 points, and the index of high-tech industries of Nasdaq Composite went to a minus on 0.57% and reached the level of 4218.87 points.

 

In the currency market, during yesterday’s trading session, the EUR/USD pair grew by 170 points to the level of 1.3696, traded this morning on a level of 1.3673. The Euro got stronger after the publication of data on the PMI index in the Eurozone. The summary index of 18 countries of the Eurozone in January, grew to the level of 53.2 points, which is the highest level since June, 2011.

 

Prices of gold sharply raised yesterday against the essential fall of the dollar, the price for a troy ounce added 2% and rose above the level of 1260,00$. This morning, prices of gold are flat and are traded with a small decrease of 0.23% on a level of 1259.36$ per troy ounce.

 

Today’s trading day is not very interesting, from the publication of macroeconomic statistical data point, but the upcoming meeting of the FED is already having an influence on the moods in the markets. The upcoming meeting is the first meeting this year and the last meeting for Ben Bernanke. On the last meeting, he declared that the QE3 will probably be reduced at each subsequent meeting of the committee, but since that time a lot of news has been presented. Growth rates of employment were slowed down, a reduction of consumer demand in both the retail sector and the real estate sector has also been declared. The mass of doubt and uncertainty will most likely press on the American currency and the stock market up until the time of the next meeting.

 

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[MAYZUS.Neeraj]

27 January 2014: Meeting Of FED Will Start On Tuesday

 

DAILY MARKET REVIEWS

By Kristina Leonova: Analyst in Portfolio Asset Management Department.

 

On Friday, the trading session was exceptionally bad for the majority of the main stock markets of the world. The Dow Jones Industrial Average index showed the strongest fall since the 20th of June 2013, and lost 1.97%, reaching the level of 15879.11 points. The index lost 3.5% in a week, which became the worst week since November, 2011, with 4 days of decrease in a row. The S&P 500 decreased by 2.09%, reaching the level of 1790.29 points, and Nasdaq Composite lost 2.15% and finished the trading session on a level of 4128.17 points.

 

The situation in the European stock exchanges did not differ, indices significantly lost in value. Following the results of the session, the key index of Great Britain, FTSE 100, went down by 1.6%, the French CAC 40 lost 2.8%, and the German DAX went to a minus by 2.5%. The regional STXE 600 indicator, in turn, decreased by 2.4% and was closed on a level of 324.75 points.

 

Mainly, markets are showing negative dynamics due to fears concerning further prospects of the development of the economy in China, the sale of currencies of developing countries, and also expectations of a new stage of turning of the QE program by the FED. Extremely large sales of currencies of developing countries began after the publication by HSBC (preliminary data on the index of business activity in the industry of China), which testify delay of growth rates of the economy.

 

The situation in the Asian-Pacific Region this morning is following the American mood, Japanese Nikkei is losing around 2.51%, the Hong Kong Hang Seng is falling by more than 2%, and the Chinese Shanghai Composite is decreasing by 1.02%.

 

This week will be rather saturated with corporate events. Within the week, quarterly results will be presented by all main IT giants, including Apple. As has been mentioned many times before, the meeting of the FED, which will start tomorrow, is going to become a main event of the week in the markets. Naturally, further direction of the markets will depend on volumes of reduction of the QE3 program. There are not a lot of statistics expected to be published today. Data on the labour market, and sales of new houses is going to be published in the U.S, and the Index of business climate of IFO will be presented in Germany.

 

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[MAYZUS.Neeraj]

28 January 2014: Today, All Attention Will Be Directed Towards The FED Meeting

 

DAILY MARKET REVIEWS

By Kristina Leonova: Analyst in Portfolio Asset Management Department.

 

On Monday, the stock market of the United States of America continued last weeks fall, and finished the trading day in the red zone. The reasons for pessimism in the markets more or less remain the same: fears concerning further prospects of development of the Chinese economy, and expectations of a new stage of turning of the QE3. The two day meeting of the FED begins today, and even by tomorrow participants of the market will be able to see the results.

 

Following the results of the trading session, the Dow Jones Industrial Average index weakened by 0.26% and was closed on a level of 15837.88 points, the index of the wide market S&P 500 went to a minus by 0.49% to the level of 1781.56 points, and the index of the hi-tech companies, Nasdaq, receded by 1.08% to the level of 4083.61 points.

 

As for the European markets, even good statistics from Germany could not push European indices to go up, and the European platforms closed the trading session with a decrease. The index of business climate of IFO in Germany made 110.6 points, at the forecast of 110 points; the index of the current conditions didn't change, and the index of economic expectations grew to 108.9 points. As a result, DAX decreased by 0.46%, FTSE 100 fell to 1.7%, and CAC 40 lost 0.41%.

 

This morning,Asian stock markets bargain in a small plus. Most likely, it is a correction after the long fall of the indices. Growth of the main indices is insignificant, within 0.1%, and markets are just flat. The Japanese Nikkei grows by 0.12%, the Korean KOSPI by 0.3%, the Shanghai Composite index adds 0.08% and the Hang Seng increases by 0.07%.The Australian index, on the contrary, shows decrease, led by falling of quotations of the largest mining companies of the world, BHP Billiton and Rio Tinto, due to fears of reduction of orders from China.

 

The prices of commodities are stable. Brent this morning adds 0.18% and is traded on a level of 106.68$ per barrel, WTI is up by 0.08% on a level of 95.8$ per barrel. Gold is losing 0.24% and bargaining on a level of 1260.37$ per troy ounce, silver is up by 0.09% on a level of 19.81$ per troy ounce.

 

Copyright: MAYZUS Investment Company Ltd

[MAYZUS.Neeraj]

29 January 2014: Nervousness Is Increasing In The Markets

 

DAILY MARKET REVIEWS

By Kristina Leonova: Analyst in Portfolio Asset Management Department.

 

Yesterday, the main stock indices of the United States showed positive dynamics and finished the trading session with an increase for the first time in the few last sessions. Published statistical data on the index of consumer confidence for January raised from 77.5 points in December to 80.7 points, whereas analysts expected only 78.1 points.

 

Following the results of the session, the Dow Jones Industrial Average index increased by 0.57% and was closed on a level of 15928.56 points, the index of the wide market S&P 500 went to plus by 0.61% to the level of 1792.5 points, and the index of the hi-tech companies, Nasdaq, added 0.35% reaching the level of 4097.96 points.

 

The season of presentation of corporate quarterly results continues, and among other interesting facts, the largest pharmaceutical company in the USA, Pfizer, added 2.6%, after declaring that the profit made in the fourth quarter is 56 cents per share, which is better than market forecasts of 52 cents per share. In contrast, the trading session for the Apple Corporation was very unsuccessful, where quotations fell to 8% because iPhone sales did not reach forecast of the analysts, even by having reached a record level of 51 mln units.

 

European stock markets also had a chance to win back some losses obtained over the last few days. The London FTSE 100 index grew by 0.33%, the Parisian CAC 40 rose by 0.98%, and the Frankfurt DAX increased by 0.55%.

 

Oil quotations are moving in slightly different directions, having got support from cold weather in America, predicting an increase of demand for raw materials, but, at the same time, are restrained by expectations of growth of stocks of oil according to EIA, on 2.338 million barrels. This morning, Brent adds 0.09%, traded on the level of 107.50$ per barrel, and WTI is losing 0.14%, bargaining around 97.27$ per barrel.

 

In general, stock markets are going to feel some nervousness today, as the attention of participants of the markets is going to be directed to the results of the two day meeting of the FED. To remind you again, this meeting is the last for the current FED chairman - Ben Bernanke. The majority of the analysts are presuming that he is going to confirm his previous statements (that the American economy is recovering), which will be a supporting signal for the continuation of turning of volumes of the QE3 program.

 

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30 January 2014: FED Cuts QE3 Program By Another 10 Billion Dollars

 

DAILY MARKET REVIEWS

By Kristina Leonova: Analyst in Portfolio Asset Management Department.

 

Yesterday, FED announced the decision on the reduction of the repayment of assets, by 10 billion dollars, to $65 billion dollars a month. This meant that the regulator ignored the weak statistical data that was presented, stating that the growth of economic activity was accelerated in recent quarters; indicators of the labor market had mixed character, but in general showed further improvement. Additionally, the interest rate was kept in its target range of 0%-0,25%, which coincided with the forecast.

 

Following the results of the trading session, the Dow Jones Industrial Average went down by 1.19% to the level of 15738.79 points, the index of the wide market Standard & Poor's 500 decreased by 1.02% to a level of 1774.20 points, and Nasdaq Composite went to a minus by 1.14% and reached the level of 4051.43 points.

 

European stock markets also came to an end in the red zone. The index of the London stock exchange, FTSE 100, fell by 0.43%, the Parisian CAC 40 fell by 0.68% and DAX fell by 0.75%.

 

The Asian markets, following American indices, began the day in a minus. The MSCI Asia-Pacific index lost 1.8%. Markets of South Korea and Taiwan were closed. In addition to the disappointing news, final PMI index from HSBC across China made 49.5 points, when forecasts were 50.5 points. Nikkei 225 lost 2.45%, and Shanghai Composite, 0.82%.

 

The FED meeting is finally over, and now investors are going to go back to following the publications of macroeconomic statistical data. Today, the following data is going to be published on: unemployment and preliminary data on inflation in Germany; business climate, consumer confidence and consumer inflation expectation in the Eurozone; preliminary estimate of gross domestic product for the IV quarter, primary requests for unemployment benefits, and data on consumer inflation in the U.S.

 

Copyright: MAYZUS Investment Company Ltd

[MAYZUS.Neeraj]

07 March 2014: ECB Gives The Euro Incentives To Clamber Up

 

DAILY MARKET REVIEWS

By Kristina Leonova: Analyst in Portfolio Asset Management Department.

 

Yesterday's trading session took place under the auspices of the expected meeting of the European Central Bank. The ECB kept the key interest rate at the former level of 0.25% and improved the forecast on economic growth. According to the new estimates of the European Central Bank, gross domestic product of the Eurozone will grow by 1.2% this year, whereas an increase of 1.1% was predicted earlier.

 

This decision was not a surprise and did not have any special impact on the markets, but the awaited press conference of Mario Draghi after the meeting did not please investors. He stated that the European Central Bank intends to keep key interest rates at the current level, or will lower them over longer period of time, whereas participants of the markets expected to hear hints on the possible reduction of rates in the near future.

 

As a result, indices closed the trading session with a insignificant growth, the British FTSE 100 got stronger by 0.19%, the French CAC 40 increased by 0.59%, and the German DAX went to plus by 0.01%. The regional STXE 600 indicator increased, in turn, by less than 0.1%, having closed on a level of 337.28 points.

 

Additionally , the euro strengthened its position in relation to the dollar and other currencies. The EUR/USD currency pair managed, from the level of opening at 1.3732 to go up to the maximum level on 1.3872, and this morning, is traded on a level of 1.3868.

 

As for the situation in the American platforms, the number of primary requests for unemployment benefits in the USA was reduced last week from the reconsidered value of 349 thousand to 323 thousand, and it appeared to be below expectations of 338 thousand.

 

Following the results of the session, the indicator of blue chips, the Dow Jones Industrial Average, raised by 0.38% to the level of 16421.89 points, the index of the wide market, Standard & Poor's 500, increased by 0.17% to the level of 1877.03 points, and the index of high-tech industries, Nasdaq Composite, went to a minus on 0.13% and reached a level of 4352.13 points.

 

In the evening, the attention of investors is going to be focused on the data on the labor market of the USA. Most probably, this data will not bring any significant changes, but now the ECB meeting is over, statistics from the US are going to be the main focus of investors attention. Yesterday, some representatives of the FED stated that only the sharp deterioration of indicators will lead to a change of course on the repayment reduction. One of them, the head of the FED of Philadelphia, Plosser, also made assumptions that it could take at least another two months before we see signs of the data being unaffected by the unusually cold winter conditions.

 

Copyright: MAYZUS Investment Company Ltd

[MAYZUS.Neeraj]

10 March 2014: The Positive Statistics From The Labor Market Supported The Markets

 

DAILY MARKET REVIEWS

By Kristina Leonova: Analyst in Portfolio Asset Management Department.

 

On the last day of the first trading week of the month, as always, it was marked with the publication of one of the most important macroeconomic statistical reports of the United States - data on the labor market from the Ministry of Labor of the USA, as well as the change of employment in the non-agricultural sector of the country.

 

The published data appeared to be better than expectations of 151 thousand, making 175 thousand. According to experts, labor employment in February could've proceeded more actively if not for the extreme weather conditions in many states of the country, which saw people spending twice as much time in order to get to work, and experiencing serious transport difficulties. Thus, there is hope that the decrease in the indicator had a seasonal nature, and the situation in the sector will continue to stabilize. In the meantime, unemployment rate grew to 6.7% from 6.6% in January.

 

As a result, the Dow Jones industrial average index raised by 0.19% to the level of 16452.72 points, and the increase over the week made 0.8%. The Standard & Poor's 500 index raised by just 0.05%, having closed at the level of 1878.04 points, and gained 1.0% throughout the week. The Nasdaq Composite index decreased by 0.37% to the value of 4336.22 points, having added 0.7% within the week.

 

Commodities opened the trading week in the red zone. Gold was also falling in price on Friday, as positive data on employment, most likely, will give the FED grounds to reduce the QE-3 program once again, at the same volume at the following meeting. Even gold gained 1.3% for the last week, and this morning the price of the precious metal is falling by 0.50% and is traded on a level of 1331.58$ per troy ounce. Silver is losing even more – 1.14%, bargaining next to the level of 20.69$ per troy ounce.

 

Brent and WTI are losing 0.96% and 1.28% accordingly, traded on prices of 107.42$ and 100.69$ per barrel.

 

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[MAYZUS.Neeraj]

11 March 2014: Uncertainty Concerning Ukraine Presses On The Markets

 

DAILY MARKET REVIEWS

By Kristina Leonova: Analyst in Portfolio Asset Management Department.

 

Yesterday's trading day, the opening of the week, was negative for the markets, and the main stock indices of the world closed the day in negative territory. The main negative factor in the market is the unstable situation in Ukraine, which increases uncertainty in the markets. Additionally, macroeconomic statistical data from Japan and China also disappointed investors.

 

Export volumes in China fell in February by 18,1%, while analysts expected an increase of 6,8%, after the increase for 10,6% in January. Deficiency of trade balance, in turn, reached $22,98 billion in comparison with a surplus of $31,86 billion recorded in January. Data from Japan also appeared to be disappointing. Gross domestic product of the country in the fourth quarter grew, according to final data, by 0,2%, whereas analysts predicted the indicator to increase by 0,3%.

 

As a result, the European stock indices closed the trading session in the red zone. The index of Great Britain, the FTSE 100, went down by 0,4%, the French CAC 40 added 0,1%, and the German DAX went to a minus by 0,9%. The regional STXE 600 indicator, in turn, decreased by 0,5% and was closed on a level of 331,4 points.

 

American indices, following the results of the trading session, also decreased in value. The indicator of blue chips, the Dow Jones Industrial Average index, lost 0,21% and was closed on a level of 16418,68 points. The index of the wide market S&P 500 went to a minus by 0,05% to the level of 1877,17 points, and the index of the hi-tech companies, Nasdaq, decreased by 0,04%, reaching a level of 4334,45 points.

 

The situation seems to be a bit more positive on the commodities market, where Brent and WTI are adding just a bit more than 0,25%, traded on levels of 107,80$ and 100,85$ per barrel accordingly. Gold grows by 0,42%, bargaining next to the level of 1347,09$ per troy ounce. Silver is up by 0,55% on a level of 21,02$ per troy ounce.

 

Copyright: MAYZUS Investment Company Ltd

[MAYZUS.Neeraj]

12 March 2014: The Negative Statistics And Nervousness Concerning Ukraine, Still Presses On The Markets

 

DAILY MARKET REVIEWS

By Kristina Leonova: Analyst in Portfolio Asset Management Department.

 

The markets seem to be stiffened with expectations or fears due to the pressure from various events, and seem unable to find the opportunity to find ground for movement in one direction or another. The Ukrainian factor still puts pressure upon world platforms. Victor Yanukovych speech, which took place yesterday, did not become a sensation, but, at the same time, did not minimize uncertainty in the markets. The international disputes on the legitimacy of occurring events remain in the spotlight. In the meantime, the process of separation of Crimea continues to develop. Yesterday, the Supreme Council of the autonomy adopted the declaration of independence of the republic.

 

Published macroeconomic statistics in the Eurozone also disappointed investors. Growth of industrial production of Great Britain in January made 0.1% for the month and 2,9% for the year, when analysts were predicting 0,2% and 3,0% respectively. At the same time, the surplus of the trade balance of Germany was reduced in January from 18,3 billion euro a month earlier, to 17,2 billion euro, which was worse than market expectations of 17,7 billion euro.

 

As a result, the trading session in Europe finished with the British FTSE 100 falling by 0,06%, the French CAC 40 by 0,48%, and the German DAX increasing by 0,46%. The regional STXE 600 indicator increased, in turn, by less than 0,1%, having closed on a mark of 337,28 points.

 

The attention of investors was also drawn towards the statistics from China, where the export in the country was reduced in February by 18%, which warmed up fears concerning the rates of its economic growth. This news pushed the American indices to go down, and the Dow Jones Industrial Average index weakened by 0,41%, closing on a level of 16351,25 points. The index of the wide market, S&P 500, went to a minus by 0,51% to the level of 1867,63 points, and the index of the hi-tech companies, Nasdaq, fell by 0,63% to a level of 4307,19 points.

 

Reuters reports that the Chinese Central Bank could, for the first time since 2012, reduce norms of reservation for banks, if rates of economic growth will fall lower than 7,5%. The following big block of statistics from China is expected tomorrow - data on retails and industrial production for February.

 

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[MAYZUS.Neeraj]

17 March 2014: The Majority Of The Population Of Crimea Voted For Accession To Russia

 

DAILY MARKET REVIEWS

By Kristina Leonova: Analyst in Portfolio Asset Management Department.

 

The question concerning Crimea still remains on the agenda. According to the preliminary results of the referendum, which already passed in Crimea, nearly 96% of the voters who took part in the plebiscite about the status of Crimea, voted for entry of an autonomy within the structure of Russia. However, official authorities of Ukraine, and also leaders of many foreign states, (OSCE and other international organizations) are considering that the referendum has gone against the constitution of the country. However, Russia considers it legitimate.

 

On the eve of this referendum, the key stock indices of Europe finished the trading session in the red zone. Following the results of the trading session on Friday, the key index of Great Britain, FTSE 100, went down by 0,4%. The French CAC 40 lost 0,8% and the German DAX went to plus by 0,43%. The regional STXE 600 indicator, in turn, decreased by 0,7% and was closed on a level of 322,23 points. This morning, DAX and CAC 40 are up by 0,64%, FTSE 100 is adding 0,41%.

 

The remaining situation is also having an effect on the commodities market, where precious metals are increasing in price. Gold is up by 0,06%, and platinum grows by 0,44%, traded on the levels of 1379,80$ and 1476,10$ per troy ounce accordingly. Silver is down by just 0,02% on a level of 21,41$ per troy ounce.

 

Prices of oil, in the meantime, are falling. Brent is down by 0,50% on a price of 107,67$ per barrel, and WTI is losing 0,21% on a level of 98,35$ per barrel.

 

From macroeconomic statistics today, attention should be paid to data on the Eurozone’s consumer price index for February. Growth of the indicator could calm the markets slightly, after the statements the head of the European Central Banks made last week.

 

Copyright: MAYZUS Investment Company Ltd

[MAYZUS.Neeraj]

18 March 2014: The First Sanctions Against Russia Have Only Political Character

 

DAILY MARKET REVIEWS

By Kristina Leonova: Analyst in Portfolio Asset Management Department.

 

The Russian President, Vladimir Putin, has signed the decree regarding the recognition of the Republic of Crimea. This news is not really positive for world platforms, but didn't affect the markets very negatively after all, as sanctions taken by various countries were rather soft. During the meeting that took place yesterday, Ministers of Foreign Affairs of the European Union introduced visa and financial restrictions for 13 Russian, and 8 Crimean officials.

 

In turn, the situation on the American platforms was also supported by the publication of strong statistics on industrial production in the country, which, in February, grew by 0,6% showing the maximum growth in six months. The restoration of economic activity of the USA after the cold winter brings optimism and inspires investors. The Dow Jones index grew by 1,13% to the level of 16247,22 points, NASDAQ added 0,81% and reached a level of 4279,95 points, and S&P 500 appeared in the plus by 0,96% finishing the trading day on the level of 1858,83 points.

 

The stock exchanges of the Asian Pacific Region are also bargaining in the green zone this morning, mainly due to the news of the soft sanctions taken against Russia by the EU and the USA. The Japanese Nikkei index grew by 0,94% so far, the Chinese Shanghai Composite by 0,08%, the Korean KOSPI added 0,91%, and the Hong Kong HANG SENG appeared in the plus by 0,48%.

 

Stabilization of the geopolitical situation affected the commodities market and is pushing the price of commodities to go down. Brent adds 0,24% and dropped to the level of 106,50$ per barrel, and WTI is increasing by 0,14% and is traded on a level of 97,76$ per barrel. Gold and silver are losing 0,87% and 1,03% accordingly, traded on prices of 1361,00$ and 21,06$ per troy ounce.

 

Now, the main question remains to be the risk of escalation of the situation in other territories of Ukraine. The insignificance of the sanctions declared yesterday by the US and the European Union could either testify to their unwillingness to break economic relations with Russia, or could be reflecting the sluggishness of the western bureaucracy.

 

Copyright: MAYZUS Investment Company Ltd

[MAYZUS.Neeraj]

19 March 2014: Attention Of Investors Will Shift From Ukraine To The FED Meeting

 

DAILY MARKET REVIEWS

By Kristina Leonova: Analyst in Portfolio Asset Management Department.

 

On Tuesday, the main stock indices of Europe and the United States showed positive dynamics after the speech of the president of the Russian Federation concerning the developing geopolitical situation. In his speech, Vladimir Putin discussed the admission of Crimea as part of the Russian Federation, and also added that Russia is not intending to divide Ukraine.

 

Published macroeconomic statistics in the region were quite different, trade balance of the Eurozone showed a surplus and made 0,9 billion euro in January, in comparison with 13,8 billion euro a month earlier. In the meantime, the index of economic expectations of investors of ZEW of Germany for March, decreased to 46,6 points from 55,7 points a month earlier.

 

As a result, the index of Great Britain, the FTSE 100, increased by 0,6%, the French CAC 40 added 1%, and the German DAX went into the plus by 0,7%. The regional STXE 600 indicator, in turn, increased by 0,6% and was closed on a level of 327,93 points.

 

Statistical data in America also didn't show any considerable changes and did not disappoint investors. Inflation of the USA in February made 0,1%, which fully coincided with forecasts and with January values. The number of constructions of houses (following the results of February) made 0,907 million which was also close to the forecast of 0,910 million.

 

So, following the results of the trading session, the indicator of blue chips, the Dow Jones Industrial Average index, raised by 0,55% to the level of 16336,19 points, the index of the wide market, Standard & Poor's 500, increased by 0,72% and reached the level of 1872,25 points, and the index of high-tech industries, Nasdaq Composite, went into the plus by 1,25% and reached a level of 4333,31 points.

 

Today, the attention of investors could move from geopolitical questions to monetary. It is expected that the FED will reduce the program of repayment of assets by another 10 billion dollars to $55 billion so far, and also that target reference points could be reconsidered. Earlier it was thought that the policy of 'cheap money' will end when unemployment in the US reached 6,5%. It has already reached 6,7%, but on the whole, the situation on the labor market in the country is far from ideal.

 

Copyright: MAYZUS Investment Company Ltd

[MAYZUS.Neeraj]

20 March 2014: Markets Reacted Negatively To Results Of FED Meeting

 

DAILY MARKET REVIEWS

By Kristina Leonova: Analyst in Portfolio Asset Management Department.

 

Yesterday we witnessed a rather interesting and emotional day, filled with important events. At present, the best idea is to try to digest all the news in order to take correct decisions.

 

Problems between Ukraine and Russia still remain on the agenda, but nevertheless are developing rather quietly and are not having a significant effect on the markets as yet. The acting president of Ukraine, Oleksandr Turchynov, presented the parliament a declaration about the "Fight for Liberation of Ukraine". According to the document, "Crimea was, is and will be a part of Ukraine". Also it was stated that: "The Ukrainian people will never, under no circumstances, stop the fight for liberation of Crimea from invaders, as heavy and as long as it shall be".

 

Also, the government of Ukraine made the decision to begin to exit from the CIS. Besides that, the Ministry of Foreign Affairs of Ukraine received an order to enter a visa regime with the Russian Federation. Meanwhile, news regarding further sanctions concerning Russia continue to arrive. The leadership of Switzerland suspended negotiations on free trade zone creation with the Customs Union (CU) of Russia, Belarus and Kazakhstan. The government of Germany stopped cooperation in the military sphere between the German defence technology producer 'Rheinmetall AG' and Russia.

 

One more event which was in investors sights and pushed indices to finish the trading session in the red zone, was the annual meeting of the FED. The FED reconsidered the policy, and Janet Yellen reported at her press conference that the program of quantitative mitigation, will most likely be complete in autumn. By the end of 2015, the key interest rate could rise to 1%, and in a year could increase up to 2,25%. Thus, according to her, before the first increase of the interest rate, a considerable amount of time will pass - "half a year or about that".

 

As a result, the indicator of blue chips, the Dow Jones Industrial Average index, lost 0,70% and went to the level of 16222,17 points, the index of the wide market, S&P 500, decreased by 0,61% to the level of 1860,77 points, and the index of hi-tech companies, Nasdaq, fell by 0,59% reaching the level of 4307,60 points.

 

Prices of commodities continue to fall. Brent and WTI are adding just 0,10% and are traded on levels of 105,96$ and 99,27$ accordingly. Gold is losing 0,70%, and fell down to the level of 1331,89$ per troy ounce. Silver is decreasing by 1,08% and is traded on a price of 20,60$ per troy ounce.

 

Copyright: MAYZUS Investment Company Ltd