Market Weekly Update 28/7-1/8
NSFX | Jul 28, 2014 03:57AM ET
US indices had mixed performances last week: DJIA lost 145 points and closed last Friday at 16,960.57 (-0.85% weekly). S&P500 closed at 1,978.34 (-0.04% weekly), down 0.75 points and Nasdaq outperformed other gauges at 4,449.56 (+0.65% weekly), up 25.50 points, making not only a new 2014 top but also a multiyear high. DJIA and S&P500 are in a trading range environment and trend following traders likely will wait a breakout before to take a position. Now is the arena of swing traders that did not have the opportunity to use this strategy this year on a daily timeframe. Geopolitical tensions so far did not have a negative impact on markets and volatility still low. Evaluations of equities using a parameter like the price earning ratio tells us that indices are above their long term P/E averages.
Crude Oil lost 1.20 $ at 101.89 $/barrel (-1.20% weekly) and Natural Gas did even worse at 3.78 $/BTU (-4.25% weekly). Gold closed at 1,308.5 $/oz (-0.07%), down 0.9$ and Silver lost 9 cents at 20.80 $/oz(-0.45% weekly). In the FX market the main theme was the appreciation of the US dollar and EurUsd lost 93 pips at 1.3430 (-0.69% weekly) and reached a level traded the last time on October 2013. GbpUsd went below 1.7 and closed at 1.6975 (-0.64% weekly), down 109 pips. UsdJpy rose 52 pips at 101.83 (+0.51% weekly) and the Swiss Franc lost against the Greenback 64 pips at 0.9046 and is only 100 pips distance from the 2014 top. The Kiwi dollar is down for the second consecutive week against the US dollar and the rate underperformed AusUsd. NzdUsd lost 131 pips at 0.8550 (-1.51% weekly) and AudUsd rose 5 pips at 0.9395 (+0.05%). Today the economic calendar will offer information just from the US with the USD Markit Composite and Services at 13:45 GMT. At 14:00 GMT Pending Home Sales will test the health of the housing market in US, a sector that needs to be monitored carefully because has direct links with the interest rate market, and with the confidence and thus risk appetite of the biggest economy in the world. The Asian session will start with the Japanese Unemployment rate data that will be released at 23:30 GMT. Then at 23:50 GMT the Japanese Retail Trade data will be followed by the Small Business Confidence at 05:00 GMT. At 08:30 GMT on Tuesday in UK will be released the Net Lending Sec. on Dwellings and Mortgage Approvals. In US at 13:00 GMT will be released the S&P/Case-Shiller and then at 14:00 GMT will be the turn of Consumer Confidence.
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On Wednesday the most important event of the European session will be the Economic Sentiment Indicator and Industrial Confidence at 09:00 GMT. At 11:00 GMT US Mortgage Application will kick off the US session and at 12:15 GMT will be released the ADP Employment change. At 12:30 GMT then will be the turn of the US Gross Domestic Product data, expected at +2.9%, from a previous -2.9%. At the same time will be released US Personal Consumption. At 14:30 GMT the appointment with US Crude Oil Inventories. The data flow will continue with the FED Rate Decision at 18:00 GMT. Is not expected a change of interest rates but volatility will increase during the data release period. At 23:50 GMT in UK will be released the Consumer Confidence Survey. Thursday, the 31st and thus the last trading day of the month will start with Australian Building Approvals at 01:30 GMT. At 09:00 GMT the Eurozone CPI should increase the intraday range of the shared currency. At 12:30 the Canadian Gross Domestic Product data will have a weight on the Loonie dollar performance. At the same time the Job Claims in US as usual followed at 14:30 GMT by the EIA Natural Gas Storage Change. Friday, the first of August, will start with the Chinese PMI, an event that will have an impact for all the trading day. The data will be released at 01:00 GMT. As usual, the first Friday of the month is the turn of the most important macro event: US Change in Non Farm Payrolls and Unemployment Rate. The former data is expected to decrease to +230K from the previous +288K of June. The latter is expected at +6.11%, a basis point increase from the June data. At 13:55 GMT will be released the Reuters/Michigan Consumer Sentiment Index. The last event on the calendar will be the ISM Manufacturing PMI at 14:00 GMT.
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