It has been a mixed day for trading in North America and Europe. The Dow and S&P closed down on the day after flirting with more new all-time highs while European stocks managed to eke out some small gains. Crude oil bounced back a bit after US stockpiles fell more than expected causing some to think that oversupply may be easing for the moment even as the supply war continues. The main news focus of the day was on central bank meeting minutes. GBP was a strong performer after Bank of England minutes confirmed the first rate hike could come mid-2016 but more importantly, pretty much ended the debate over whether the bank’s next move would be a rate increase or a decrease with the hawkish side dominating. US markets were active on the afternoon release of minutes from the last FOMC meeting. Overall there weren’t any big surprises with members split on whether there would be enough positive data by the June meeting to encourage the Fed to start raising interest rates It looks like a larger group was thinking no for June but still members were of the opinion that guidance should be dropped and the Fed should decide what to do on a meeting by meeting basis. Members thought the slow conditions of Q1 were seasonal and would not persist. The debate over whether there were problems with the Q1 GDP report have intensified. Earlier this week a San Francisco Fed report suggested issues with the seasonal adjustment and that by their calculations Q1 GDP should have been up 1.8% instead of 0.2%. Late today reports suggested the Bureau of Economic Analysis agreed there have been problems with its data and that revisions may come over the next few months. These developments mean that today’s flash manufacturing PMI reports from around the world may be even more closely scrutinized and could have an impact on trading. These are the first data points for May which traders may look to for an indication of how economies are faring now that spring has arrived in the Northern Hemisphere. For the US, traders may be looking to see if the US has rebounded out of the winter as strongly as last year. This could lead to another round of speculation on when the Fed may start raising interest rates. First up are China and Japan. JPY has weakened while the Nikkei has been rallying ahead of tomorrow’s Bank of Japan meeting indicating that the street appears to be thinking the central bank may remain dovish and keep its QE program going at current levels. Flash Japanese PMI could influence thinking heading into the meeting, particularly if it comes in stronger than thought. The china report may have a wider influence, potentially impacting trading in Chinese and China sensitive markets like the Hang Seng, S&P/ASX, copper, AUD, NZD, crude oil and more. Corporate News NetApp $0.65 vs street $0.72, guides next Q ESP to $0.20-$0.25 way below street $0 60, 9% dividend increase Economic News Significant announcements released overnight include: Bank of England meeting minutes 9-0 vote in favour or maintaining interest rate and QE US crude oil inventories (2.6 mmbbls) vs street (1.75 mmbbls) Upcoming significant announcements include: 11:35 am AEST Japan flash manufacturing PMI street 50.3 11:45 am AEST China flash manufacturing PMI street 49.3 8:00 am BST France flash manufacturing PMI street 48.5 8:00 am BST France flash service PMI street 51.9 8:30 am BST Germany flash manufacturing PMI street 52.0 8:30 am BST Germany flash service PMI street 53.9 9:30 am BST UK retail sales street 3.7% vs previous 4.2% 9:30 am BST UK retail ex auto and fuel street 3.7% vs previous 5.0% 8:30 am EDT US jobless claims street 270K 9:45 am EDT US flash manufacturing PMI street 54.5 10:00 am EDT US Philadelphia Fed street 8.0 10:00 am EDT US existing home sales street 5.23M 10:00 am EDT US leading index street 0.3% 10:30 am EDT US natural gas street 96 BCF ECB President Draghi and Fed Vice-Chair Fischer speaking
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