Varchev Finance: Trading day in one post - 01.03.2018

Trading Setup



Asian stock market: Asian stocks declined on the first trading day of the month after finishing February with losses. Declines in the region also tracked sharp losses seen stateside in the previous session. The Nikkei 225 declined 1.39 percent, or 307.24 points, on the first day of March. Automakers, technology stocks and financials traded lower. In Sydney, the S&P/ASX 200 declined 0.74 percent. Losses were led by the energy sub-index, which fell 2.05 percent in the morning. Mining majors were also weaker in the morning, with Rio Tinto falling 3.96 percent and Fortescue Metals losing 1.69 percent. Hong Kong's Hang Seng Index extended losses in early trade, edging down by 0.6 percent. Financials were in negative territory in the morning, with insurer AIA falling 1.07 percent and heavily weighted HSBC off by 0.51 percent.


FX market: The Bloomberg Dollar Spot Index rose 0.1%. The Japanese Yen fell 0.1% to 106.76 per dollar. The euro fell less than 0.05% to $1.2193. The Aussie fell 0.4% to 77.28 U.S. cents. By one measure, investors are the shortest against the dollar since 2011, leaving them vulnerable to a rally in the U.S. currency. Citigroup Inc.’s FX Positioning Alert Indicators (PAIN) index was at -50 as of Tuesday, from -5 at the start of the month. The Bloomberg Dollar Spot Index, meanwhile, had climbed 0.6 percent to its highest level since Feb. 9 after Federal Reserve Chairman Jerome Powell said his outlook for the economy has strengthened.


Commodities market: WTI crude rose 0.1% to $61.71 a barrel. Gold fell 0.2% to $1,315.53 an ounce. Gold in dollars is clinging onto a small gain this year even after Federal Reserve Chairman Jerome Powell opened the door to four interest rate hikes, but investors in some other currencies are under water, with those in Japan faring the worst with a loss of more than 4 percent. While currency movements go some way to explain the discrepancy, it may reflect a softening of interest in bullion as the global economy strengthens and rates increase.


European stock market: Negative moods will also reign over European markets on the first day of the month. There, the German DAX will start with a 31-point loss at 12,334; UKX will fall 15 points around 7,186, and the French CAC remains unchanged. Investors remain cautious with Italy's election behind the corner. Following Germany's vote in September last year, it's now the Italians who are headed to the ballot box this Sunday, with the outcome expected to be even messier than Berlin's — which, incidentally, is still being pieced together by Chancellor Angela Merkel and her coalition partners. Polls have pointed to a hung parliament where no one party will gain a majority to govern alone.


U.S. stock market: U.S. stocks fell sharply in choppy trade Wednesday, giving up earlier gains, as Wall Street wrapped up a volatile month for the major averages. The Dow Jones industrial average closed 380.83 points lower at 25,029.20, with Caterpillar as the worst-performing stock in the index. More than half of the day's losses came in the final hour of trading with the Dow losing more than 240 points in the final 60 minutes. The S&P 500 pulled back 0.9 percent to close at 2,713.83, with energy as the worst-performing sector. The Nasdaq composite ended 0.8 percent lower at 7,273.01. Jeff Kilburg, CEO of KKM Financial said the S&P 500 dipped below its 50-day moving average late in the session. "That forces some technical selling pressure and flushes out some weak longs," he said. Earlier in the session, the S&P 500 and Nasdaq rose as much as 0.6 percent and 0.7 percent, respectively. The Dow gained as much as 166.12 points. The Dow and S&P 500 snapped 10-month winning streaks, their longest since 1959. The Nasdaq posted a monthly loss for the first time in eight months. For the month, the Dow and S&P 500 closed lower by 4.3 percent and 3.9 percent, respectively. The Nasdaq closed February down 1.9 percent.


Economic calendar for the European and U.S. trading sessions
09:00 UK - Nationwide Housing Prices
10:55 Germany - Markit Производствен PMI
11:00 Europe - Markit Производствен PMI
11:30 UK - Markit Производствен PMI
12:00 Europe - Unemployment Rate
15:30 USA - Personal Income / Spending
15:30 USA - Initial Jobless Claims
16:30 Canada - Markit Производствен PMI
17:00 USA - Markit Производствен PMI

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