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- Trading day in one post 14.08.2017
Trading day in one post 14.08.2017
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Loading...Overview of the Asian markets: The indices of the most of the Asian markets were trading higher today, after the fall that they endured last week. Only Nikkei in Japan was lower, despite the fact that GDP reading came in at 1% which was better than expected. The data from China came in at lower than expected of 6.4% for the industrial production, as it was expected at 7.2%. Investors headed to the safe-heaven financial instruments as the Gold and JPY. President Trump warned N. Korea not to threaten the US and its allies, as it may launch a military action against it. The geo-political situation did not affect the markets to much overnight, as top ranking military personal made a statement that war against N. Korea is not imminent and for now its not planning for a strike. That calm all market participants.
Overview of FX market: The Euro was trading around $1.18260, after it climbed by 0.1% during the previous session. The AUD fell slightly down to 0.7905 against the USD. Governor Lowe from the RBA said that the next move for the interest rates will likely be up, but the timing is not set in stone. The USD reached 9 month low against the JPY and continued to trade weak. Having in mind the uncertainties around N. Korea, the JPY did started strongly at the beginning of the session but after that it weakened , as the USD/JPY reached 109.400. The strong support at 109 held and now the pair is heading higher. The GBP was stable and continue to get stronger, it is possible that this is only a correction and likely traders will continue to sell off the currency later and from a higher levels. There is no change in the negative sentiment as the BoE left rates unchanged. There is the possibility to see higher USD but if that will be only a correction or reversal of the shorts will have have to wait and see.
Commodities markets: The price of Gold held at its previous high around $1.290, after the investors sought out the metal as a hedge. The Silver also jumped to around $17.10, following Gold price. The price of Oil did not participate overnight but we might see it go higher again after the situation with N. Korea. As a whole the prices of the commodities will continue to go higher in part due to the weak USD.
Overview of the European market: It is possible to see a new fall of the indicies today, if investors continue to worry about the situation with N. Korea. For now the futures are pointing for a positive start of the session with CAC40 to open with 22 points up, the German DAX up by 44 points and the FTSE 100 with around 23 points up. There are no important news from Europe today, with the exception of the Industrial Production reading. This might be negative for the indices. For now the situation remains calm, but most likely the investors will remain on the side lines until more information comes out to what US will plan to do. Stoxx 600 finished the previous week lower by 1% and that is a 5 month low, as the energy sector, communication stocks and basic material companies where the main contributors for the fall. This correction was the biggest for the Euro indices for this year.
Overview of the US Market: The increasing geo-political risks are negative for the financial markets on Friday, but the indices did managed to close higher. Its quite possible that some investors limited their market exposure and bought Gold, Oil or JPY in order to hedge their risk.
The S&P 500 fell by 1.43% down to 2,438 points, but this is small move compared to the up move that was generated this year. The VIX climbed to its highest level to 15.50, from April to now, after President Trump sent a message to N. Korea not to threaten the US or its allies. On Friday the S&P 500 index went higher by 3 points, Nasdaq Composite added 40 points, and DJIA by 14 points. Investors will likely remain on the sidelines until there is move information and clarity around what the US is planning to do with N. Korea. Today there are not important news from the US and this might be negative for the indices.
Economic calendar for the European and American trading sessions:
Tentative - CHY- New loans
Tentative - CHY - M2 Money Stock
12:00 - Euro zone - Industrial Production
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