Review of the world’s major financial markets from January 26, 2015

Stock markets continued to trade in a positive mood, perhaps because this week all the attention switched to the Fed. And after a series of news about the reduction of interest rates and monetary easing key CB world, many believe that Janet Yellen will sound «softer». As a result, Hong Kong’s Hang Seng (HSI) at the end of trading day gained 0.24%. Meanwhile, Britain’s FTSE rose by 1.2%, while Germany’s DAX rooted immediately by 2.2%. US stock indices also showed a strengthening of completion trading day.

It was a very exciting and volatile day that morning began with a victory of the Greek left party «Syriza» and ended reduction in Russia’s sovereign rating to «junk» agency S & P. Both events are generally expected and incorporated in the price, but quite a serious factor for the sharp fluctuations in exchange rates. Despite the fact that the news from Greece initially pressed on EUR / USD, after a couple for the next multi-year lows 1.1096, but the total correctional movement helped to complete the pair is trading around 1.1266. Meanwhile, GBP / USD also recovered above 1.50, completing trades near 1.5080. USD / JPY was able to roll away from the Asian low 117.26 to 118.44 at the close. USD / RUB grown to 65.97 at the close of the area due to the growing geopolitical tensions caused by military operations in Mariupol.

Oil prices fluctuated within narrow ranges, then falling down, getting up on conflicting known since the market. As a result, Brent opened trading at $ 48.25 a barrel, slipped to $ 47.55, then reached 49.25 to the end of trading returned to the area of ​​the opening level.

Precious metals fell back a bit from the highs reached last week as part of a technical correction. So, XAU / USD from the opening level of $ 1294.72 has slipped to 5-day low of $ 1275.81 and closed at around $ 1281 per ounce, while silver traded near 17.90 at the close.

Forecast for Tuesday, January 27

Stock market

Despite the abundance of important political and economic news Monday, the stock market is likely to prefer to focus this week on the results and the rhetoric of the meeting FOMC, which will end on Wednesday. On the one hand, economic data showed a good momentum that could force the Fed to reduce the period of transition to a tightening of monetary policy. But on the other hand, inflation is too low, which can convince the regulator to remain in the former regime under the threat of deflation. It is quite possible that the second argument will prevail at the next meeting: a factor of falling energy prices, strengthen the US dollar and too slow wage growth causes expect the further falling CPI below the 2% level. If we hear a soft comments this time, this can cause a surge in demand for US NASDAQ-100 (NQ) and Dow Jones (YM), adding them to the order of 2% at the event.

And today we could not get over the news from IBM — yesterday the company had fallen by almost 1.5% on rumors that this week will be announced on the reduction of 110 thousand. Workers. If the rumors are true — it is almost twice the size of the largest in US history, a single dismissal. And the greatest figures showed again the IBM 1993, reducing staff by 60 thousand. Most likely thing is that the company reoriented to cheaper labor in India, completely covering all the positions in the United States. However, it should be understood that there where there is a cost optimization and reduction of inefficient employees there is a place for good growth in the next few quarters. Thus, the current, relatively low levels for the shares can be used as an attractive entry point for medium-term trading.

Commodities

From Baker Hughes came back the next data on the number of operating oil and gas wells, which brought another week of decline. Against the background of falling oil prices, the US company announced plans to cut 7 thousand. Workers in the coming months. Australian giant BHP also announced a reduction in the number of offshore wells in the US by 40% by the end of the financial year. Thus, according to the latest data, after the number of operating wells peaked in October 1609 2014 index confidently goes down and has declined by 18% to 1317. When the index will reach 1200, which was observed at the beginning of 2013, we can talk about reversal of the downward trend for oil prices — which grew from 400 in 2010 to 1600 in 2014 the number of wells will begin to come to a more balanced value.

Also yesterday, OPEC Secretary General Abdalla Salem El-Badri said that the lack of investment in the future may bring oil prices to $ 200 a barrel. It is necessary to remember this moment — the first time in a long time representative of the cartel spoke so aggressively. It is possible that all this preparation for the more active verbal intervention, which may return Brent above $ 50 per barrel and move the boundaries of the current range up to $ 55- $ 60 per barrel.

Foreign exchange market

For the first time since 2005, Russia’s sovereign rating was downgraded on Monday to junk. S & P has warned that it will happen, most investors are still waiting for this January 16, and Minister of Economic Development Ulyukayev told a high probability of such a scenario. So would it be a big blow to the Russian market? Most likely, the short-term reaction to the «surprise effect» we really see with the collapse of the domestic stock market indices and a sharp «gap» up to USD / RUB at the opening of the trading session. However, the correction can come after a few hours, since, firstly, there are still two rating agencies, which have not yet revised their estimates to the appropriate status; Secondly, everyone understands that the problem is a political position rather than the level of national debt — it is we do not exceed 10-12% of GDP, which is the lowest among the countries of the «Big Twenty»; Third, the decision was expected and has long been incorporated into prices. Now worsen the position of the ruble can only further sanctions. Thus, we do not exclude that the USD / RUB will try to come up to the mark of the opening of 70.00, but would then be inevitable correction to 67.00.

EUR / USD has twice tested the support of 1,100 and both times unsuccessfully. In all likelihood this level will thus «bottom», which can stop a further drop in the pair for a while. Firstly, the most negative news is already included in the price. Second, technically oversold pair, and the number of short positions rolls. Third, concerns about the political conflict between Greece and the eurozone are beginning to subside. And, fourthly, its role can be played and the imminent meeting of the FOMC, which can also bring their own surprises in the form of a softer mood Janet Yellen.

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Review of the world's major financial markets from January 26, 2015 | Web Trade For All - Forex trading, analytical reviews of the market and help for beginners