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- Varchev Finance: Trading day in one post – 18.06.2018
Varchev Finance: Trading day in one post - 18.06.2018
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Loading...Asian stock market: Most Asian markets fell on Monday as investors digested the escalation in trade tensions between the U.S. and China after both countries announced tariffs last week. Japan's Nikkei 225 declined 0.91 percent, with all sectors trading lower. Shippers led losses in the afternoon, with the Topix sea transport subindex sliding 4.15 percent. Steelmakers dropped 2.2 percent and oil stocks tumbled 3.32 percent amid an extended drop in oil prices. South Korean markets recorded similar losses, with the benchmark Kospi down 1.08 percent and the secondary Kosdaq sinking 2.41 percent. Down Under, the S&P/ASX 200 bucked the trend to edge higher, with the index last higher by 0.17 percent. Declines in the materials and energy subindexes were offset by gains in the financials sector, as Australia's "Big Four" banks all traded higher.
FX market: The long-term picture of USD/JPY speaks for the continuing of the growth of the differential in the yield of US and Japanese government securities. In the short run, however, we may witness increased selling pressure for the purchase of safe-haven assets due to the escalation of the fears of the US-China trade war. Overall, everything depends on the bond yield movement. If US stocks fall because of the trade war, then investors will seek protection in the face of bonds. This will lower the yield on them. If the yield falls, then the dollar will become a less attractive investment. Additionally, a decline in stocks will trigger investors' old move to leave risky markets and buy the yen. This week, investors will have the opportunity to respond to the speech of the president of BoJ Kuroda. He may reveal the future plans of the central bank in the battle with low inflation. He can also comment on US-related trade problems. Recently, Trump threatened to impose a duty on car imports. This is a threat to an export-oriented Japanese economy.
Commodities market: Oil marked its 4th consecutive week of decline, closing on a key level of support - already a resistance. There is a specific reason for the sharp decline and it will certainly not affect the price only on the short term. Saudi Arabia and Russia, who backed the abstraction program, have sharply changed their mining policy and are currently pushing to raise the upper limits to full-scale mining. In words, the agreement continues to receive support from a large portion of OPEC's 24 members, but a massive increase in yields is now being observed, last seen when its price was around $25- $30. In other words, the race for who will pump and sell more oil starts. If our story is to be measured, then we can very soon expect a strong collapse of black gold.
European stock market: Today European stock markets will open with declines. With the lack of major economic news and company revenue reports over the coming week, the trade-related headlines are likely to dictate sentiment after the Donald Trump administration has announced new $50bn tariffs for Chinese import goods, and Beijing threatened to respond of the impact. These news shook the stock markets strongly and expectations that sentiment will remain negative. The Fifth Annual ECB Central Banking Forum will be held in Sintra, Portugal from Monday to Wednesday. It will focus on prices in advanced economies. During the three sessions, approximately 150 central bankers, academics, financial journalists and large market participants will express their opinions and exchange ideas on current economic issues and issues and discuss selected topics with a long-term perspective.
U.S. stock market: Escalating trade rhetoric will hold fingers after Donald Trump has announced $ 50 billion in Chinese import goods on Friday, urging Beijing to warn of such an answer. Trump has provided a list of more than 800 strategically important imported goods from China, which will be subject to 25% tariffs, entering into force on July 6, including cars. In addition to the negative sentiment, the technical analysis also speaks of a fall in indexes. The S & P 500 reached a resistance that failed to break through the last 5 sessions, and it seems that the correction will continue this week.
Economic calendar for the European and U.S. trading sessions:
15:45 USA - FOMC Member Dudley Speaks
16:00 USA - FOMC Member Duke Speaks
17:00 USA - NAHB Housing Market Index
20:00 USA - FOMC Member Bostic Speaks
20:30 USA - ECB President Mario Draghi Speaks
Trader Aleksandar Kumanov Read more:
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