Varchev Finance: Trading day in one post – 22.06.2018

Asian Stock Market: Most of the Asian markets trade mixed today as the trade dispute between US and China remains a major concern for investors. Morgan Stanley lowered its targets for a number of Asian stock indices.

FX Market: The dollar index has reached a key resistance level, relying on 200SMA on a weekly chart, the dollar momentum gives signs of exhausting and as a result we might see collecting of profits until the end of the month. The yen and Swiss franc are set to outperform their Group-of-10 peers this week as renewed trade tensions between the U.S. and China support demand for haven currencies. The New Zealand, Canadian and Australian dollars are among the biggest G-10 losers this week on concern the dispute between the world’s largest economies will damp global growth and demand for commodities. Central bankers from the U.S, Europe, Japan and Australia warned this week the escalating trade friction could hurt the global economy. The Bank of England (BOE) has kept its main interest rate unchanged Thursday amid uncertainty over the economy’s wider direction, but the Pound found a support as bank’s Chief Economist Andy Haldane joining more hawkish committee members Michael Saunders and Ian McCafferty in calling for a rate rise to 0.75 percent. Still, the bank said that all committee members “agree that any future increases in (the) bank rate are likely to be at a gradual pace and to a limited extent.”

Commodity Market: Gold comes out of lethargy, but despite trade concerns and increased demand for safe havens, contrary to all logic, precious metal prices continue to slide down. Oil, ahead, all eyes will be on OPEC and its allies as they meet in Vienna later on Today. 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. However Iran said it could compromise the forthcoming OPEC + meeting by supporting a slight increase in yield. However, experts are of the opinion that the forthcoming OPEC+ meeting will end with a disagreement between the individual members of the cartel as there is no unanimous opinion on the issue of the increase in yields. Saudi Arabia, along with Russia, Ecuador and Kuwait, are increasing the yield, while Iran Algeria and Venezuela are against. The three parties in question, which are an obstacle to an agreement, blame Donald Trump for raising prices by imposing a limit on their exports to the United States. It is logical for the three countries to chase a higher price given the limited exports to the world’s largest oil consumer.

European stock market: In addition to trade concerns, a major driver of Europe today will be the series of PMI data that will be released by the region’s most emerged economies. Caution will be the queen of the Old Continent today.

U.S. stock market: Apart from trade, the backdrop of a deterioration in forward-looking indicators of global growth and a stronger dollar has resulted in a more cautious outlook for equity markets in the region. Despite global trade fears tech stocks are on fire lead by known as FANG stocks. The bigger picture trends mitigate any worries about a global trade war.

Economic calendar:

09:45 France – Gross Domestic Product

10:00 France – Markit Manufacturing PMI

10:00 France – Markit Services PMI

10:00 France – Markit PMI Composite

10:30 Germany – Markit Manufacturing PMI

10:30 Germany- Markit Services PMI

10:30 Germany – Markit PMI Composite

11:00 EU – Markit Manufacturing PMI

11:00 EU – Markit Manufacturing PMI

11:00 EU – Markit Manufacturing PMI

15:30 Canada – Retail Sales

15:30 Canada – Consumer Price Index (CPI)

16:45 U.S. – Markit Manufacturing PMI

16:45 U.S. – Markit Manufacturing PMI

16:45 U.S. – Markit Manufacturing PMI

20:00 U.S. – Baker Hughes US Oil Rig Count

22:30 U.S. – CFTC net positions

 Trader Georgi Bozhidarov

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