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- Varchev Finance: Trading day in one post – 12.07.2018
Varchev Finance: Trading day in one post - 12.07.2018
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Loading...Asian Stock Market: Asian stocks edged higher on Thursday, with markets shaking off some of the trade jitters seen overnight after the Trump administration announced a list of Chinese goods that may be subject to new tariffs. The Nikkei 225 rose 1.15 percent in Tokyo morning trade, reversing most of its declines from the previous session. In Seoul, the Kospi added 0.34 percent although declines in blue-chip tech stocks capped overall gains. Elsewhere, Hong Kong's Hang Seng Index edged up by 0.1 percent. On the mainland, Shanghai composite tacked on 0.67 percent, paring some of Wednesday's sharp losses and the smaller Shenzhen composite climbed 0.9 percent. Meanwhile, the S&P/ASX 200 tacked on 0.67 percent in Sydney.
FX market: There isn't a big catalyst for the dollar strength today but here are some reasons: Strong US wholesale data and PPI, Trouble in emerging markets, especially Turkey, It's weathered the trade war rhetoric and news remarkably well, Add another one to the list -- the US Senate just passed a symbolic motion to back a role for Congress in reviewing tariffs based on national security grounds. The vote was an overwhelming 88-11 and suggests Congress might one day stand up to Trump on trade (some of their donors would certainly like that). Today is CPI day and that will be a major mover but for now it's a one-way street for the dollar.
Commodities market: Oil prices will back away from $80 a barrel over the next six months as Saudi Arabia and its allies add more supplies to the market. Saudi Arabia — along with Russia, Kuwait and the United Arab Emirates — has vowed to meet global oil demand as U.S. sanctions cut off Iranian exports later this year and Venezuela's output continues to decline. Brent crude has traded between about $77 and $79.50 this month, but Barclays forecasts it will average $73 a barrel in the second half of 2018. Morgan Stanley recently raised its six-month outlook for Brent to $85 a barrel after the Trump administration took a more hawkish stance on cutting off Iran's oil exports. Goldman Sachs warned last month that prices could overshoot its call that Brent will peak at $82.50 this summer. Governments around the world could also tap their strategic oil reserves, Barclays said. While oil stockpiles held by companies have fallen to their five-year average at 2.8 billion barrels, governments in developed countries keep another 1.8 billion barrels in reserve for emergencies.
European stock market: Today European indexes will open with cautious upgrades. Asian traders have managed to shake off the worries about the trade war, which comes as a sip of fresh air for European traders. On the other hand, there is also a time when markets are stopping to react to these speculations and are not so subordinate to news with such rhetoric. Today we are looking forward to the ECB report since the last meeting on monetary policy. The sentiment among ECB members began to change sharply after it became clear that some of the central bankers were of the opinion that the bank had to raise the base interest rate early in summer in 2019 and not at the end of the year.
U.S. stock market: Today, market participants will look at CPI data. Expectations are for a 0.2% increase for the previous month. Changes in prices for individual groups of commodities are likely to balance each other: wholesale prices, for example, are a signal for a smaller decrease in the prices of used cars, while hotel prices have risen recently, indicating counter-movement. As in May, annual CPI data will be about 2.8% This means that inflation will remain unchanged. Higher US tariffs also slightly increased prices, as will be seen in the months, as was the case with one of the first actions in this direction of Trump, when it imposed 20% tariffs on laundry imports. The washing machines were actually 18% more expensive in May than in March, which made the annual comparison positive for the first time since 2012. With household appliances occupying 0.08% in the consumer price index, inflation rates are barely rising, but this may soon change with the introduction of imported car tariffs. Other big news in the US is not expected, so Donald Trump and commercial rhetoric will be a major driver of stock markets. Investors remain cautious.
Economic calendar for the European and U.S. trading sessions:
09:00 Germany - CPI
12:00 Europe - Industrial Production
14:30 Europe - ECB Publishes Account of Monetary Policy Meeting
15:30 USA - CPI
19:15 USA - FOMC Member Harker Speaks
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