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- Varchev Finance: Trading day in one post – 14.08.2018
Varchev Finance: Trading day in one post - 14.08.2018
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Loading...Asian stock market: Asian shares were mixed on Tuesday, as some regional markets bounced back one day after declining over jitters related to economic uncertainty in Turkey. The Nikkei 225 rose 1.22 percent, with all sectors trading higher after the yen gave up some of its recent strength amid safe haven demand on uncertainty in Turkey. Elsewhere, South Korea's Kospi edged higher by 0.11 percent. Tech names were a mixed bag, with LG Electronics dropping 4.46 percent while index heavyweight Samsung Electronics rose 0.55 percent. Down Under, the S&P/ASX 200 added 0.79 percent, with the energy, financials and materials subindexes recording gains of more than 1 percent. Greater China markets, however, declined. Hong Kong's Hang Seng Index erased 0.67 percent, with the 4.32 percent drop in industrials leading losses. Tech sector names also recorded heavy declines, with heavyweight Tencent dropping 2.49 percent.
FX market: The weak CAD period may end on the basis of good Canadian indicators and the growing hope of reaching NAFTA. The dollar's rally may also begin to lose momentum, as investors are beginning to pay more attention to the continuing threat of protectionism in the US and the appreciation of the dollar. The currency still seems to be underestimated relative to the relative spreads, the current oil price level and the risk appetite. In addition, CAD devaluation may affect Canadian inflation this week and encourage interest rates to rise in October. If investors begin to assess the risk of rising interest rates over the coming months, we may see higher CAD rates. At present, investors think they have about 60 percent chance of raising interest rates in October. This likelihood may increase before the inflation data is released in Canada this week. I believe that CAD devaluation can continue to fuel inflation and thus expectations of monetary tightening. Uncertainty about NAFTA goes on after the media reports that Canada can join the talks as soon as possible.
Commodities market: OPEC oil production rose in July. Block production averages 32.32 million barrels a day for July, up with 41,000 barrels, OPEC reported in its monthly report. The organization agreed in June to increase production by 1 million barrels per day to prevent a sharp rise in oil prices. This happened after President Trump called on the organization to act to prevent further growth. At the same time, OPEC lowered its global oil growth estimate by 20,000 barrels per day, to 1.64 million barrels a day this year. This is due to weaker than expected oil demand from Latin America and the Middle East in the second quarter. The organization also said that trade tensions between the US and China are unlikely to have a major impact on world oil demand growth, unless the cracks extend beyond these countries. OPEC expects demand for crude oil to be 32.9 million barrels a day, which is about 600,000 barrels less than last year.
European stock market: European sectors are expected to follow the example of their colleagues from Asia and start the session mixed. Uncertainty around Turkey has led investors to withdraw their equity from stocks and to pour them into safe haven assets. As far as the economic calendar is concerned, there are several important events that traders need to look out for in the new week. Today, Germany and Europe will announce GDP for the quarter, with no changes expected from the previous quarter.
U.S. stock market: The indices are close to their record levels that can be broken, but the strong dollar may have a negative impact on them and delay the new peaks, despite expectations of good indicators and rapid growth in the economy. The US economy is currently dominating, with macro indicators being very promising. The only thing that does not give investors a calm is inflation, trade rhetoric and the relationship between the US and Turkey.
Economic calendar for the European and U.S. trading sessions:
09:00 Germany - Gross Domestic Product
11:30 UK - Average Earnings Index + Bonuses
12:00 Europe - Gross Domestic Product
15:30 USA - Import/Export Price Index
Trader Aleksandar Kumanov Read more:
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