By IFCMarkets
On Tuesday the US stock indices slightly edged up. The US GDP for the 3rd quarter was revised up from 1.5% to 2.1% in line with expectations. This positive was partly offset by the unexpected fall of the consumer confidence index for November to the lowest since September 2014 while it was expected to increase. The energy sector edged up together with the global oil prices. The trade volume on the US stock exchanges was 6.9bn stocks which is 4.2% lower the average for 20 trading days. Today at 14:30 CET the personal income and expenditures, the durable goods orders as well as weekly unemployment for October will be released in the US. At 16:00 CET the October new home sales and final November Michigan University index will be released. In our opinion, the overall outlook is positive. The US dollar index live data show the index slightly slid down yesterday on the heightened political risks after Turkey shot down the Russian warplane in Syria. Nevertheless, no particular reaction followed yet, so the index recovered today. Tomorrow the US markets will be closed due to the holiday – Thanksgiving Day.
European stock indices closed mixed yesterday. Today they are advancing after the German retailer Metro (+5.2%) and cement producer LafargeHolcim (+4.4%) announced the increased dividends. On this news the British housebuilders Persimmon, Barratt Developments and Taylor Wimpey edged up around 5%. Strong financial statements from the Thomas Cook Group travel agency, whose shares jumped 10%, gave additional support to the European markets. Deutsche Lufthansa AG airline stocks added 3.6%, TUI AG travel company added 2.2%. No important macroeconomic data is expected today in the EU.
Nikkei index is slightly down amid the stronger yen. It has been growing for the whole previous week. Some of market participants decided to lock in profits before the holiday in the US and due to the heightened political risks in the Middle East. The Japan’s exporters were in the red: Honda Motor (-1,1%), Mazda Motor (-1,5%) and Panasonic (-1,3%). The Japan’s government is planning to raise the requirements to the capital of the broker companies which pushed down the Nomura Holdings (-2,3%), Mizuho Financial (-2%), Mitsubishi UFJ (-2,1%) and Sumitomo Mitsui (-2,1%) stocks. Early on Friday the important macroeconomic data on October inflation and unemployment will be released. The outlook is neutral as they are expected to remain unchanged from September levels.
The sugar prices are becoming more volatile. Its expected production in India in 2015/16 is 26-27.7mln tonnes, according to International Sugar Organization. This is much more than the Indian farmers are planning to harvest. The poll of more than 900 local households showed they expected a harvest of 23mln tonnes. The official figure is 26mln tonnes. India is the second world biggest sugar producer after Brazil. Meanwhile, Platts Kingsman agency expects the sugar deficit to widen in 2016/17 to 6.4mln tonnes from 3.3mln tonnes in 2015/16.
The global oil prices are correcting down today after 3 straight days of growth following the shot-down Russian airplane and bombing of IS oil carriers. Markets expect the today’s official report from the EIA on the US oil stockpiles weekly change at 16:30 CET. Previously the independent American Petroleum Institute reported on their 2.6mln barrels increase. The Goldman Sachs IB said the global oil prices can tumble below $20 in a zip in case the demand from China contracts due to the economic slowdown and due to the increased oil production in Iran. The US Regional Climate Center at Cornell University said this October was the warmest since 2007 in the South-Eastern regions of the US. Speaking of the whole country, this October was warmest since 2007, according to National Oceanic and Atmospheric Administration. This factor may cut demand for gas and residual oil.
Market Analysis provided by IFCMarkets
Free Reports: