NAFTA is already in the history after US, Mexico and Canada have reached a new USMCA (USMCA) agreement. The new framework agreement includes better access for US dairies to the Canadian market, while Canada agrees with import duties on cars produced in the country.
The news has had a strong positive impact on US stock exchange and Canadian dollar futures, and has led investors to turn JPY back despite the slowdown in the Chinese manufacturing sector. Worse data on the Chinese PMI, coupled with the deal between the US, Mexico and Canada, contributed to the mixed sentiment during the Asian session.
How will this be reflected in European markets?
General moods are highly positive, so cash flows will be focused on the purchase of European shares, which will lead to a rise in European indices already on the interbank market. With the launch of the interbank market at 09:00, we will likely see further JPY sales and futures growth on major stock indices in Europe.
However, the new trade agreement will negatively affect the automotive sector, which, despite the fact that countries are holding hands, will be subject to strong sales. The reason is that Canada has agreed to the import of cars in the US, something Europe is most afraid of.
Do not forget China and the worse PMI, which will lead to the sale of mining companies and those that are export-oriented specifically to China.
Read more:
25 Canada Square, Level 33, office 50, Canary Wharf London, E14 5LQ +44 20 3608 6256
World Financial Markets - 0700 17 600 Varchev Exchange - 0700 115 44
Varchev Finance Ltd is registered in the FCA (FINANCIAL CONDUCT AUTHORITY) with a passport in the United Kingdom: FCA, United Kingdom - registration number: 494 045, which allows provision of financial services in the United Kingdom.
Varchev Finance Ltd strictly comply with the statutes of the European directive MiFID (Markets in Financial Instruments). targeting increased efficiency, transparency and uniformity of financial instruments.
Varchev Finance Ltd is authorized and regulated by the Financial Supervision Commission - Sofia, Bulgaria: License number RG-03-02-05 / 15.03.2006
The information on this site is not intended for distribution or use by any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.
Disclaimer:
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 63,41% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.