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- What to expect next week 04-09.05.2017
What to expect next week 04-09.05.2017
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Loading...Over the past week we were seeing a rise and fresh index records with Nikkei hit 20,000, S&P 500 up to 2439, and DJIA rose to 21227.70. Technology indexes extended all-time highs.The dollar weakened and Treasuries advanced with gold after the latest jobs report offered mixed signals on the strength of the American labor market, while U.S. stocks pushed to fresh records as technology shares continued to rally.
Gains rate-sensitive shares drove the S&P 500 Index to a new record after the 10-year Treasury yield touched the lowest level of the year following wagegrowth and hiring that was below forecasts. The Bloomberg dollar index fell to the lowest level since November. Gold jumped and oil headed for a weekly drop.
The latest jobs report likely won’t deter the Federal Reserve from increasing interest rates in two weeks as the economy continues to grind higher even as Washington shows few signs of moving forward with tax and spending reforms. Global equities have advanced more than 10 percent this year to set fresh records as data showed growth in the world’s largest economy is intact.
The important news we will be watching next week:
Monday:
National holiday in Switzerland, Germany and New Zeland (Queen's birthday)
04:30 AUD - Company Gross Operating Profits
04:45 CNY - Caixin Services PMI
10:50 France - Services PMI
10:55 Germany - Services PMI
11:00 Europe - Services PMI
11:30 UK - Services PMI
15:30 USA - Unit Labor Costs
16:45 USA - Services PMI
17:00 USA - Factory Orders
17:00 USA - ISM Non-Manufacturing PMI
Tuesday:
02:01 UK - BRC Retail Sales Monitor
04:30 AUD - Current Account
07:30 AUD - RBA Interest Rate Decision
10:50 France - Services PMI
10:55 Germany - Services PMI
11:00 Europe - Services PMI
12:00 Europe - Retail Sales
17:00 USA - JOLTs Job Openings
17:00 Canada - Ivey PMI
Wednesday:
04:30 AUD - GDP
09:00 Germany - German Factory Orders
10:30 UK - Halifax House Price Index
12:00 Europe - GDP
15:30 Canada - Building Permits
17:30 USA - Crude Oil Inventories
Thursday:
02:01 UK - RICS House Price Balance
02:50 Japan - GDP and Currenct Accaunt
04:30 AUD - Trade balance
05:47 CNY - Imports and Exports
05:48 CNY - Trade Balance
08:45 Switzerland - Unemployment Rate
09:00 Germany - Industrial Production
10:15 Switzerland - CPI
11:16 Canada - Housing Starts
14:45 Europe - ECB Interest Rate Decision
15:30 Canada - New Housing Price Index
Friday:
04:30 AUD - Home Loans
04:30 CNY - CPI and PPI
09:00 Germany - Trade Balance
11:30 UK - Industrial and manufacturing production
11:30 UK - Trade balance
15:30 Canada - Employment Change and Unemployment rate
What to expect next week?
AUD - During the next week we expect increased volatility on Tuesday and Wednesday due to the GDP data and the interest rate decision respectively. It is possible to observe a short-term rise in the Australian currency against the US dollar as it is at levels of diagonal support from which it has rebounded. But in the mid-term there is a double top formation with a breakthrough and test of the neckline which implies a continuation of the downward movement.
GBP - The fall in the pound is likely to continue next week amid the upcoming UK parliamentary elections on June 8th. The recent GBP/USD rally was probably due to the expectation that Teresa May's party will win. Recent data show a narrowing of its lead, which has led to a decline in the pound. If her party wins with a bigger advance then we will probably see a slight increase in the British currency as the news is already being played out. However, if she loses the election, it will have a very negative impact on the pounds and we can see a strong downward movements on its currency pairs.
Crude Oil - The crude oil prices fall is likely to continue in the next week. The decline of 5% was due to the record high level of production by the US since August 2015. OPEC last week agreed to renew its pledge to rein in production in order to balance the market and boost prices, but curbs on output haven’t been reflected in shipments. While compliance with the deal has been unprecedented, crude exports from OPEC members rose to 25.4 million barrels a day in May, the highest level this year. Technically, we see a "head and shoulder" formation as the price has crossed the neckline, suggesting that the it's likely to keep falling to around $45/barrel.
Jr Trader Ivan Ivanov
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