By IFCMarkets

World stock markets were traded sideways at the end of last week as investors activity was low due to Catholic Christmas celebration. The US stock indices, Dow and S&P 500, managed to hit record highs in intraday trading. However, the indices showed a relatively slight rise over the week. The Dow upped 1.4%, S&P 500 – 0.9%, NASDAQ – 0.9%. There was no significant US economic data released on Friday. Today we also don’t expect any information. The trading volume was 60% below the monthly average and reached 3.1 billion stocks. Currently, futures on US stock indices are traded “noticeably down”. Note that the US dollar index hasn’t still managed to consolidate above the psychological resistance level at 90 points. Subsequently, the euro has suspended to fall against the dollar.

European markets are traded down today amid the political risks associated with the third round of voting in Greece, electing its president. If today the Greek Parliament fails to elect the president, it may trigger a snap election which will be finished only on February, 8. Investors believe that it could have a negative impact on the economy of the entire European Union. The election results in Greece will be announced approximately at 11:00 СЕТ. Important economic reports in the EU are not expected to be released until Friday.

Nikkei has slipped today along with other global stock indices. An additional negative factor was the news of the first Ebola case in Japan. The investor activity was low. The trading volume on the Tokyo Stock Exchange was 18% lower than the monthly average. Let’s remind that macroeconomic data will not be released this week. Japanese stock exchanges will be closed from December 31 up to and including January 4.

World oil prices climbed slightly amid the renewed fighting in Libya: 800 thousand barrels or nearly two-day production volume of the country was destroyed over that period. An extra factor providing support for oil prices was the policy conducted by the Central Banks of China and Japan, aimed at economic growth boost. China is planning to cut rates once again early next year. On Saturday the Japanese government approved a plan of economic incentives in the amount of $29 billion.

Natural gas price in the US tumbled 26% in December, and reached the psychological support level of $3 per million BTU for the first time since 2012. It was caused by the warm weather forecasted in the United States this winter, according to the Commodity Weather Group. Note that 49% of American housing uses natural gas for heating. Amid the warm weather conditions, the US gas reserves may hit historical highs, more than 4 trillion cubic feet by the beginning of the next heating season. Now the gas reserves make up 3.25 trillion. Note that the US gas production has risen 5.5% this year and reached a record high of 74.3 billion cubic feet a day. It happened mainly due to an increase in shale gas production by 19%, up to 16.3 billion cubic feet. However, we accept the possibility of a technical price upward retracement, starting at the level of $3, or at least highly volatile trading.

Copper prices have reached a four-year low today, after the negative data on Chinese industrial revenues in November was released on Saturday. Its total reduction appeared to be the largest in two years. Note that the Chinese PMI in December will be released on December 31. The outlook is negative: it may affect the commodity futures prices.

Soybean prices are at the two-week high due to the flooding in Malaysia, the world leader in palm oil production. Investors deem that it would increase the demand for alternative soybean oil.

Market Analysis provided by IFCMarkets