Asian Stock Market – Asian markets were trading mixed, reflecting uncertainty about the trade war and lack of a foundation to drive markets. The Nikkei 225 rose 0.79%, while the markets in China were getting red. Hang Seng registered a 0.03% drop, Shanghai composite traded at 0.06% lower, and ASX in Australia collapsed by 1.13%.
FX Market – Poor GDP data contributed to the NZD sales during the Asian session, while other major currencies remained static. Investors are already focusing on SNB and BOE, which will announce their key interest rate decisions later today. At 10:30, we expect the Swiss National Bank’s basic interest rate decision. The bank is expected not to change its monetary policy, but is likely to increase the volatility of the FX market. At 11:00, central bankers will give a press conference and direction to investors where they will take over the country’s monetary policy. A little later at 14:00, Bank Of England will make the same decision as traders do not expect a raise in interest rates. Important now will be the Dot Plot system, which visualizes the mood among the members of the bank. If we observe a change in individual members’ opinion to support the increase, GBP will most likely be able to recover but short-term. For its decision, the central bank will highlight the uncertainty surrounding Brexit.
Commodity Market – Oil volatility continues to be high, the root of which is rooted in the forthcoming OPEC + meeting to be held today and tomorrow in Vienna. The question that concerns all market participants is whether group members will maintain production restrictions that have raised black metal prices to $ 70 a barrel or there will be a change in the agreement that reduces daily production by 1.8 million barrels from the market for the past 18 months. Russia is pushing to return a million barrels a day to the markets. Saudi Arabia will most likely try to reduce the number to prevent prices from falling too much. But, not all OPEC members agree. Iran, Venezuela and Iraq are of the opinion that the current agreement is good and should be maintained. Gold prices lost more than 4% on Friday, as traders expect an increase in global supply.
European stock market – European stock markets will be driven mainly by moods about the war and the two upcoming interest rates. An hour before the opening of the interbank market, futures of European indices point to positive moods. The German DAX30 will open 40 points higher at a price of € 12,746. The French benchmark will open up 11 points at a price of around € 5391. Despite Bank Of England’s upcoming interest rate decision, UKX welcomed a positive start to London’s trade – 7661 versus 7637 pounds at yesterday’s closing.
US Stock Market – New Day, New All Time High for Nasdaq. The index gained 0.7 percent to 7781.52 points thanks to Facebook and Netflix, which also reached record highs. The shares of both companies rose by 2.3% and 2.9%, respectively. The S & P 500 jumped 0.2 percent to levels around 2767.32 points, with the property sector performing best. Meanwhile, Dow remained on red territory with a fall of 0.17% to a level of 24,657.80 points, marking its seventh consecutive day of losses. This is the longest losing series since March 2017.
Economic calendar for European and US trade sessions – 21.06.2018
09:00 Switzerland – Trade Balance
10:30 Switzerland – Swiss National Bank interest rate decision
10:30 Switzerland – Swiss National Bank Monetary Policy Report
14:00 United Kingdom – Bank Of England Interest Rate Decision
15:30 United States – Philadelphia Manufacturing Index
15:30 USA – Jobless claims
15:30 Canada – Wholesale Sales
23:15 UK – Speech by Mark Carney, Bank Of England Governor
15:30 Canada – Wholesale Sales
23:15 UK – Speech by Mark Carney, Governor of Bank Of England
Chart: Used with permission of Bloomberg Finance L.P.
Trader Petar Milanov