Market Report 08.09: The bad data that actually is Good.
In the last weeks the US economic received very bad numbers, but curiously or not, that numbers are good for the market of Wall Street and in consequence for all the markets in the world. Why? Because with that information about the American economics the FED cannot raise the interest rate at least cannot do it in September. We find disappointed sector service activity data on Tuesday that pushed back expectations for the Federal Reserve to move ahead with a rate hike this year. According to Investing.com’s Fed Rate Monitor Tool, odds do not pass the 50% threshold until the February 2017 meeting at 52.7%. The chance for a September rate hike is at 21%.
So, this is very good for the markets and we can see a slowly reaction. But I think the trend is still positive and in the next’s week is possible to reach all the time high price again, and remember: “the trend is always your friend.”
Today the European stocks opened lower, ahead of the September meeting of the European Central Bank. The central will announce its first policy decision since the Bank of England eased policy in August in response to concerns over Brexit. There is a chance of some central bank one-upmanship. The ECB may decide if wants to add it stimulus in equal measure to the Bank of England to defend the Eurozone from any unwanted economic consequences of Brexit.
All the investors are waiting for the meeting until to something, so for that we are expecting very low volume and slow volatility, the real session start after the meeting and then we have in the economic calendar another important event: The Initial Jobless Claims with a forecast of 265k, for the markets is better as high as possible. Then second one event more relevant in the day is the Crude Oil Inventories. Brent oil prices had hovered around $47.92 before the API figures became public Wednesday afternoon, which caused the price to spike above $48.54 a barrel within five minutes of the release. Today the Information Administration data will include the government’s official inventory statistics, which do not always give with the API report’s estimates, adding another layer of volatility to oil prices. Analysts had expected crude inventories to rise by 905,000 barrels this week, after seeing builds in five of the past six weeks.
In the forex markets, for the euro the meeting is also relevant, and edged down to $1.1242 from Wednesday’s high of $1.1272. The euro was steady as investors also looked to whether the ECB would decide to extend its asset purchase program, which could give more power in the European currency.
The Germany indices is one of the most volatilities after the announcements of the Mario Draghi, now is in the zone of resistance at 10.770, but after the speech we could see stronger movements in this market. If ECB say something good for the European Markets, the potential is very high.
Graphics by: www.etoro.com
The most important technology product of the year, a new Apple iPhone, was announced on Wednesday. Yesterday in the last hour of trading on the day the stock of Apple rose from 107.14 until 108.26, this is a possible very good signal of how the new iPhone was received for the public.
Graphics by: www.etoro.com
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