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- Varchev Finance: Trading day in one post 21.03.2018
Varchev Finance: Trading day in one post 21.03.2018
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Loading...Asian stock market: Asian markets traded cautiously higher on Wednesday, with markets focused on the Federal Reserve after it kicked off its March meeting. Gains in the region took cues from the overnight move higher on Wall Street after a pull back earlier in the week. Hong Kong's Hang Seng Index got a lift, jumping 1.21 percent as technology, energy and property names led gains. Mainland markets also notched gains, with the Shanghai composite rising 0.48 percent and the Shenzhen composite adding 0.63 percent. Elsewhere, Seoul's benchmark Kospi index inched higher by 0.08 percent while the junior Kosdaq gave up early gains to slip 0.17 percent. Over in Sydney, the S&P/ASX 200 drifted higher by 0.27 percent. Energy stocks rose 1.4 percent after oil prices surged to their highest levels in three weeks overnight, while telecommunication and utilities stocks declined.
FX market: The Bloomberg Dollar Spot Index fell 0.2%. The euro rose 0.2% to $1.2263. The pound nudged 0.1% higher to $1.4016. The yen was little changed at 106.48 per dollar. Every time there's an apparently positive headline on Brexit, it seems you only have to wait a little while for the pushback or proviso. Even with yesterday's news on a transition plan, the prickly issue of the Irish border remains, and until this significant challenge is surmounted, it's hard to see EUR/GBP breaking out of its continued bout of range-trading. Yesterday's price action in the pair followed the template from Dec. 8 (when the first round of Brexit talks was completed). The pound rallied sharply early in the day on the good news and then unwound a big chunk of that. EUR/GBP closed that day at 0.8792, within a few pips of yesterday's close. Back then, as today, the Irish border remained the major sticking point. Until it is solved, don't expect much EUR/GBP downside.
Commodities market: WTI crude built on a 2.2% advance to gain 0.2% to $63.66 a barrel. Gold rose 0.2% to $1,313.64 an ounce. WTI's fundamental and technical setup looks very strong. Tuesday's surge helped oil's triangular wedge to resolve to the upside, which could signal more gains ahead. On the fundamentals side, API said U.S. crude inventories unexpectedly fell last week, boosting the likelihood Wednesday's EIA report will be bullish. Oil's outlook is also improving as Middle East tensions grow amid signs Trump will withdraw from the Iran nuclear deal and reimpose sanctions after meeting Saudi Crown Prince bin Salman during his visit to the U.S.
European stock market: European markets will start trading with a cautious note. There, the German DAX will start with 9 points profit at 12,350; the French CAC is progressing with the modest 6 points and will open around 5,261 while the UKX remains unchanged in expecting more information on the progress of the Brexit talks.
U.S. stock market: U.S. stocks climbed on Tuesday as the Federal Reserve started a two-day monetary policy meeting, with most market participants expecting a rate hike. The Dow Jones industrial average rose 119 points, with Boeing as the best-performing stock. The S&P 500 gained 0.2 percent, with energy leading the gains. The Nasdaq composite advanced 0.3 percent. Market expectations for a March rate hike are 94.4 percent as of Tuesday afternoon, according to the CME Group's FedWatch tool. While most market participants expect the Fed to raise rates by 25 basis points, they will also look for clues about whether the central bank will stay on track to hike three times this year or if it expects to further tighten policy. "The upcoming FOMC meeting is preceded by a market crash, elevated volatility, rising negative sentiment around trade, while consensus view of the Fed remains hawkish," said Dubravko Lakos-Bujas, head of U.S. equity strategy at J.P. Morgan, said in a note Tuesday. "Given this backdrop, even a slightly dovish Fed outcome would setup a rather low bar for equities to advance."
Economic calendar for the European and U.S. trading sessions:
10:00 Europe - Non-Monetary Policy's ECB Meeting
11:30 UK - Average Earnings Including Bonuses
13:00 UK - CBI Industrial Trends Survey
14:00 USA - Current Account
16:00 USA - Existing Home Sales
20:00 USA - Fed Interest Rate Decision
20:30 USA - FOMC Press Conference
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