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- The impulse of the market today and what can we expect until the end of the session
The impulse of the market today and what can we expect until the end of the session
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Loading...2 main factors are driving the markets and will determine the movements until the end of the session. The first one is the expected landfall of the hurricanes Harvey and Irma. The anticipations are for serious economic damage, which could change the outlook for the next couple of weeks. This by itself can force Fed to take no action in regards of the additional rate hike scheduled for late this year. This is causing the selloff in the greenback today. The other main factor is the expectation, that this weekend will probably lead to another ballistic missile test from North Korea, which could increase the geopolitical risks. This forces investors to allocate their assets in safe havens as JPY, CHF and Gold.
Of course, ECB's director Mario Draghi affected the markets as well yesterday, however for the time being this is a secondary factor and mainly the USD and JPY are driving the markets.
Regarding the indexes the outlook is a tad different. If we become witnesses of big damage from the hurricanes, this could be positive for the markets. The reason for that is, that after them everything has to be restored. After that, the USD will strengthen too, as today the negative aspect of the hurricane is trading.
Next week we expect development from two major laws in the US: the healthcare and the tax reform, which also will have a positive influence. This is the reason for the minimum reaction from today's caution on the indexes in the USA. European shares are holding steady for the moment, due to the positive comments from Draghi on the economy in the zone. We expect the mood to remain positive in the coming week.
The selloff in the greenback are too strong and the indicators are signaling for oversold levels, which could lead to a correction in the USD and a decline in JPY.
Стефан Д. Ангелов - Head of Stocks Trading
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