Daily Market Reviews by MAYZUS

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10 January 2014: Negative Moods Prevail In The Markets

DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.

On Thursday, key stock indices of Europe showed negative dynamics due to the statements of Mario Draghi. Besides that, investors’ decisions were influenced by the last protocols of the last meeting of the FOMC, which contained obvious hints on turning of the program of quantitative easing.

It should be noted that yesterday, the European Central Bank and Bank of England kept monetary policy unchanged, thus, according to Mario Draghi, rates will remain at a low level for a long time, but as for the present it is too early to say that the Eurozone is out of danger. Draghi also emphasized that unemployment remains at a high level, and dynamics in the sphere of crediting is still rather weak.

As a result, the main European stock indices finished the trading session with Great Britain's index (the FTSE 100) losing 0.5%, the French of CAC 40 became 0.8% easier, and the German DAX went to a minus also by 0.8%. The regional STXE 600 indicator, in turn, decreased by 0.4% and was closed on a level of 328.41 points.

Currency markets were also influenced by presented data and statements, which added to the strengthening of the Dollar. After the press-conference after the ECB meeting, we first saw further strengthening of the EUR/USD to a maximum of 1.3632, and then witnessed a kickback to a minimum at the level of 1.3548, ending the trading day around 1.3580. At the present time, the currency pair is traded on a level of 1.35988 and its further development can be influenced by the labor market figures today, if they are going to be positive. The next purpose of the pair is on 1.3550 and further on 1.35.

Nevertheless, today it is necessary to pay an attention to the data on the labor market, which will be published in the second part of the day. Forecasts suggest that employment in the nonagricultural sector of the US is supposed to increase approximately by 200 thousand, and unemployment should remain at the former level of 7%. And last, but definitely not least, the factor bringing negative vibes to the markets has been the start of the season of corporate reports. Alcoa did not justify forecasts, the next in line to report are the banks.

Copyright: MAYZUS Investment Company Ltd

 

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13 January 2014: The Markets Cannot Find Their Feet After Winter Holidays

DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.

For the first days after New Year's vacation, leading stock markets of the world show quite weak activity. Even publications of important macroeconomic indicators cannot push indices to start forming trends in one way or another, neither in the US, Europe, nor in emerging markets. Important indicators, which will be able to have an influence on the market, will be the statistics on industrial production of the Eurozone on Tuesday, and new data from the real estate market in the US on Friday. Besides that, American companies already begun the reporting period for the fourth quarter of the previous year, which could lead to an emergence of volatility in the markets.

On Friday, the statistics of the labor market in the US recorded a minimum level of unemployment in the country for the last five years. The coefficient fell from 7% last month to 6.7% in December, which increases the probability of further reduction of the program of monetary stimulation at the next meeting of the FED at the end of January. At the same time, the quantity of created workplaces for the same period was much lower than expectations, and made only 74 thousand, which was the minimum level for 2013.

For the last three years, the economy of the US created about 2 million workplaces, but at the same time, the unemployment rate remains quite high. It is worth remembering that the desirable unemployment rate, at which the FED could go for a rate increase, is on the level of 6.5%. The second indicator for the FED is the inflation, data on which is going to be published on Wednesday and Thursday.

As a result, the last trading day of the week finished with the Dow Jones industrial average index decreasing by 0.05% to 16437.05 points, retreat in a week made 0.2%. The Standard & Poor's 500 index raised 0.23%, having closed at the level of 1842.37 points, the increase in a week made 0.6%. The Nasdaq Composite index raised by 0.44% to the value of 4174.66 points, having added 1% within the week.

The price of futures of gold raised by 1.4% to the value of 1246.90$ per troy ounce, traded this morning at the level of 1249.20$. Gold rose in price, owing to the dollar weakening, and the dominating confidence of investors that weak data on growth of employment, will not allow the FED to continue further reduction of QE3. In total, gold lost 0.7% in a week.

Oil increased in price as a result of the retreat of the dollar, and against growth of the Chinese import in December. The price of futures of WTI raised by 1.2% to level of 92.72$ per barrel, traded this morning at 92.57$. Brent is down by 0.13%, at 106.47$ per barrel. Last week was the second unprofitable week in a row for oil prices.

Copyright: MAYZUS Investment Company Ltd

 

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14 January 2014: Decrease Noted On World Platforms During Yesterday’s Trading Session

DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.

During yesterday’s trading session, the American players preferred to take profit from the majority of stocks before the publication of the results of the large banks for the fourth quarter of 2013. Growth of some stocks by 25-30% last year in many respects could be considered as an advance, and fears that reports will not be able to meet expectations, forced the participants of the market to take a third-party position, and take profit.

As a result, the Dow Jones on Monday lost its maximum level of 1.10% since 20th of September, reaching the level of 16257.94 points.The S&P went back to the levels of the middle of December, decreasing by 1.26% to the level of 1819.20 points, and Nasdaq Composite decreased by 1.48% to the level of 4113.30 points.

In comparison to the American indices, the European indices spent the day in a boring side trend, however managed to close the trading session with a small increase. Important statistics in the region were not published, however there were no reasons for sales either. Following the results of the day, the index of the London stock exchange FTSE100, increased by 0.26%, the French CAC40 added 0.3%, and the German DAX appeared in a plus for 0.39%.

This morning, the main indices of the Asian-Pacific region, following the American trading session, show, in general, negative dynamics. The exception being the Chinese Shanghai Composite, adding 0.86%. The Japanese Nikkei fell upon 3.07%, the Korean KOSPI lost 0.24%, and the Hang Seng decreased by 0.45%. Today in Japan, data on trade balance for the November period in 2013 has been published, which showed record deficit, which caused such a steep correction.

During the day, the attention of investors will be concentrated on news coming from the US and the published data on retails, which will help participants to understand more deeply the current development of the economy in the USA. This data could cause increasing volatility on the currency market and influence further decrease in the stock market.

Copyright: MAYZUS Investment Company Ltd

 

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15 January 2014: Macroeconomic Data And Quarterly Reports Of Companies Are Bringing Positives On The Markets

DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.

Yesterday, the American trading session finished on a positive note. Firstly, retails in the USA for December grew by 0.2%, at expectations of an increase of 0.1%. It is a very important indicator of the situation in the US economy, as the consumer demand makes about 70% of the gross domestic product of the country. Obviously, investors did not leave such a positive factor aside.

Statements from the representatives of the FED didn't spoil the mood of investors, and indices continued their growth. The president of the FED of Philadelphia, Charles Plosser, believes that the monetary easing program has to come to an end within the current year, as the economy steadily moves towards restoration. The president of the FED of Dallas, Robert Fisher, also considers that the quantitative program has to be completed, as it is similar to beer alcoholism, whereby everything is seen through rose tinted glasses. "We already reached a condition of intoxication", he stated.

As a result, the Dow Jones increased by 0.71% up to the level of 16373.86 points. The S&P 500 added 1.08% finishing the trading session on a level of 1838.88 points, and Nasdaq Composite grew by 1.69%, up to the level of 4183.02 points.

Additionally, on the positive side, the World Bank raised forecasts of growth rates of the world economy yesterday. According to Bank forecasts, growth of the world economy will make 3.2% against the previous forecast of 3%. I would like to remind you that in 2013, the world economy grew by 2.4%. Optimism of the World Bank is connected with the improvement of the situation in Europe and the USA.

However, the situation in the commodity markets is not so positive. Oil prices and prices of precious metals continue to fall. Brent is down by 0.16%, to the level of 105.43$ per barrel, and WTI is decreasing by 0.09%, to the level of 92.7. Gold and silver prices are down by 0.37% and 0.70% accordingly, traded on a price of 1240.69$ and 20.14$ per troy ounce.

During the day, macroeconomic statistics will continue to be published, and reports of regulators on the state of the economy, which could have an impact on moods of the world markets. Among the most important, it is beneficial to note gross domestic product of Germany, the index of production activity of the USA, the price index of producers of the USA, and the monthly regional report "Beige book". Besides that, investors will follow the release of reports from the American companies, among which, is Bank of America, reporting today.

Copyright: MAYZUS Investment Company Ltd

 

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16 January 2014: The Success Of The Banking Sector Promotes Growth Of Indices

DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.

European stock markets had a rather positive trading session yesterday, the German DAX increased by 2.0%, having reached a new historical record point. The economy of Germany looks forward with optimism, and, according to forecasts of the German Central Bank, gross domestic product of Germany will grow this year by 1.7% and by 2% in 2015.

Among the favorites of growth yesterday in the European stock market, were shares of banks such as Deutsche Bank, adding 3.1% in value, and Commerzbank, increasing by 3.0%, added on expectations of the announcement by the European Central Bank of parameters of the stress tests, which carried out, will hopefully increase trust in the European banking system.

The increase of forecasts on growth rates of the world economy by the World bank, and also the rise in price of shares of stocks in the banking sector, alongside the inspiring report of Bank of America, gave support to the American market.

From yesterday's published macroeconomic statistical data, it is possible to note the increase in the Producer Price Index in December by 0.4%, as it was predicted by the market. At the same time, oil stocks for the past week were reduced, according to EIA, on 7.658 million barrels, whereas analysts expected a decrease in stocks by only 0.613 million barrels.

As a result, the indicator of "blue chips", the Dow Jones Industrial Average index, got stronger by 0.66% and was closed on a level of 16481.94 points, the index of the wide market S&P 500 went to a plus by 0.51% to level of 1848.38 points, and the index of hi-tech companies, Nasdaq, recovered by 0.76% to the level of 4214.88 points.

Papers of the banking sector were, for investors, in special demand. Shares of the second biggest creditor in the USA, Bank of America, rose in price by 2.3% after it reported more than a quadruple increase in the quarterly profit, which absolutely surpassed forecasts of analysts. Quotations of Wells Fargo & Co and JPMorgan Chase & Co grew, in turn, by 1.8% and 3% respectively. Among the favorites of the trading session was also the American corporation, Apple, which market capitalization increased by 2% due to a statement given by China Mobile, which confirmed that advanced orders of the iPhone reached 1 million units.

The is one more important test ahead– the publication of the report of CPI reflecting inflationary tendencies in consumer level. This index needs to confirm a rise in prices in order to convince representatives of the FED of the possibility of further cutting the monetary easing program. If the numbers show amplifying inflationary pressure, it will mean that the American consumer will be able to overcome any short-term uncertainty, and will continue to spend their savings.

Copyright: MAYZUS Investment Company Ltd

 

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17 January 2014: Investors Don't Rush Their Decision-Making

DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.

Yesterday, the trading session in the main European stock platforms passed rather quietly, and the main focus of the participants of the market was on statistical data, which mostly coincided with forecasts of analysts. Final data on the consumer price index of Germany was presented for December, which, as expected, increased by 0.4%. Meanwhile, the similar indicator on the Eurozone grew by 0.3%, also having coincided with market forecasts.

As a result, the key index of Great Britain, the FTSE100, went down by 0.07%, the French CAC40 lost 0.3%, and the German DAX went to a minus by 0.17%. The regional STXE 600 indicator, in turn, decreased by 0.2% and was closed on a level of 333.99 points.

As for the macroeconomic statistics published in the United States, in general, it was of a neutral character. Data on inflation for December corresponded to average market forecasts, the consumer price index, taking into account seasonality, grew by 0.3%, and the basic indicator of inflation added 0.1%. Furthermore, the number of primary requests for unemployment benefits for the past week practically coincided with the forecast, having decreased from the reconsidered 328 thousand, to 326 thousand. Finally, the index of business activity of the FED of Philadelphia in January, made 9.4 points, when 8.6 points were forecast.

Following the results of the session, the indicator of blue chips, Dow Jones Industrial Average, went down by 0.39% to the level of 16417.01 points, the index of the wide market, Standard & Poor's 500, decreased by 0.13% to the level of 1845.89 points, and the index of high-tech industries of Nasdaq Composite went to a minus on 0.09% and reached the level of 4218.69 points.

In the commodities market, the situation seems to be stabilizing. The price for Brent is increasing by 0.23% and is on a level of 105.99$ per barrel. WTI is up by 0.52% on a level of 94.59$. Gold and silver are adding 0.18% and 0.13% accordingly, traded on the levels of 1242.44$ and 20.08$ per troy ounce.

Expectations of the continuation of the reduction of the program of quantitative easing, give support to the Dollar, and during the continuation of active discussions on this subject, the attention of investors is concentrated on speeches from the heads of the regional FED. Today, the report on the situation of the economy is going to be made by the president of the FED of Richmond - Jeffrey Lacker.

Copyright: MAYZUS Investment Company Ltd

 

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20 January 2014: Sluggish Day Ahead Due To Lack Of Statistics, And The Celebration Of Martin Luther King Day In The U.S.

DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.

On Friday, the American stock indices couldn't decide where to move. The Dow Jones Industrial Average index was closed with an increase of 0.25% and reached the level of 16458.56 points, and at the same time, S&P 500 and Nasdaq Composite, following the results of the trading session, decreased by 0.37% and 0.49% respectively, traded on a level of 4197.58 and 1838.70 points. Today, the stock exchanges of the US are closed due to the celebration of a national holiday - Martin Luther King Day. Thus, the main attention of investors will be riveted on dynamics in Asia and Europe.

The published reports of the companies were ambiguous. The reporting of GE and Intel disappointed, whereas American Express, Visa, and Morgan Stanley shares grew after an exit of figures. The index of consumer moods of Michigan university in January decreased to 80.4 points, which was worse than the forecast of 83.5 points. In December, the quantity of new buildings was reduced by 9.8% compared to the last month, and here the result was also worse than the forecasts.

This morning, data was presented on the condition of the Chinese and Japanese economy, which were again a little weaker than expectations, which caused a small negative at the trading session in the Asian region. Annual growth of China decreased from 7.8% to 7.7% in the fourth quarter, in quarterly expression the gain of gross domestic product decreased from 2.2% to 1.8%. Industrial production in annual expression fell from a level of 10% to 9.7%, and investments into fixed capital of China were reduced from 19.9% to 19.6%. In the industrial sector of Japan, we also observe deterioration. The latest data for January showed a decrease in industrial production by 0.1%.

The Commodity market is flat, oil prices this morning are down by 0.11% on Brent, and 0.68% on WTI, traded on a level of 106.36$ and 93.94$ per barrel accordingly. Gold is up by 0.23% on 1254.87$ per troy ounce, and silver is increasing by 0.02% on a level of 20.31$ per troy ounce.

Copyright: MAYZUS Investment Company Ltd

 

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21 January 2014: The Banking Sector In Europe Is Under Pressure

DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.

In absence of the American players on Monday, the European stock indices finished the trading session without any significant development.

From the macroeconomic statistics published yesterday, it should be noted that the price index of producers of Germany for December grew by 0.1%, at average forecasts of 0.0%. Thus, in comparison with data from the similar time period last year, decrease of the indicator made 0.5%, as expected.

As a result, the index of Great Britain, FTSE 100, increased by 0.11%, French CAC40 lost 0.11% and the German DAX went to a minus by 0.28%. The regional STXE 600 indicator, in turn, decreased by 0.1% and was closed on a level of 335.5 points.

Worse off than the other sectors of the market were shares of the banking sector. So, the shares of Commerzbank, Credit Suisse and ICAP decreased by 4.5%, 2.5% and 4.3% respectively. Additionally to that, market capitalization of the largest creditor of Europe, Deutsche Bank, decreased by 5.4%, after it reported that the loss before payment of taxes in the fourth quarter made 1.15 billion Euros. Analysts, in turn, predicted profit at the level of 628.5 million Euros.

The background this morning looks rather positive: futures for the American indices add 0.5%, bull moods prevail in the Asian-Pacific, with Japanese Nikkei increasing by 1.4%, the Hong Kong Hang Seng adds 0.6%, and the Chinese Shanghai Composite grew by 0.7%. The positive situation is mainly due to the statement from the Bank of China, and their willingness to provide additional liquidity to small and large banks of the country.

The situation on the commodities market also remains the same, and there have not been any strong changes for the last few days. Brent is increasing by 0.19%, traded on a level of 106.55$ per barrel, WTI is down by 0.34%, on a level of 94.27$ per barrel. Gold adds in value 0.02%, traded on the level of 1252.10$ per troy ounce, and silver is down by 0.49% at the level of 20.20$ per troy ounce.

In America, the large banks already published their reports, and this week, the market focus will be on papers of the hi-tech companies and retailers. Figures from Microsoft, IBM, Starbucks and Netflix are expected. Today, Johnson & Johnson and Verizon will publish reports. As for the most important statistics today, it is worth paying attention to the publication of the index of activity of ZEW across Germany, whereby a decrease from 62 points to 61.5 points is expected.

Copyright: MAYZUS Investment Company Ltd

 

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22 January 2014: The IMF Increased Forecasts On GDP

DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.

The International Monetary Fund raised forecasts on growth rates of the world economy for the first time in the last two years, however, emphasized that the richest and most developed countries develop at the present moment with slower rates than they actually could. Besides, the IMF noted that deflationary risks remain to be on a high level.

According to the updated estimates, world gross domestic product will increase by 3.7% in the current year, and then by 3.9% in 2015. We will remind you that in October, the growth of the world economy in 2014 was expected to be on a level of 3.6%. The IMF also improved the forecast for the USA from 2.6% to 2.8%, for China from 7.2% to 7.5%, and for Germany, from 1.4% to 1.6%.

Following the results of the trading session, the indicator of "blue chips", the Dow Jones Industrial Average index, was closed with a minus of 0.27% on the level of 16414.44 points, the index of the wide market S&P 500 increased by 0.28% to the level of 1843.80 points, and the index of the hi-tech companies, Nasdaq, grew by 0.67% to the level of 4225.76 points.

As for the European stock markets, the British FTSE 100 was reduced by 0.04%, the French CAC40 increased by 0.02%, and the German DAX got stronger by 0.15%. The regional STXE 600 indicator increased by 0.1%, having closed on a level of 335.76 points.

The indicator of economic moods in the Eurozone from the results of research carried out by the German institute ZEW, in January, grew to 73.3 points from 68.3 points in December. The same indicator for Germany, according to ZEW estimates, increased in January from 32.4 points a month earlier, to 41.2 points, whereas analysts expected 34.1 points.

The price of WTI oil, following the results of the day on NYMEX, raised by 0.4% to the level of 94.97$ per barrel, and is continuing its growth today and increasing by 0.54% to the level of 95.66$ per barrel. Brent is up by 0.54%, traded on a level of 107.30$ per barrel. The prices of gold and silver are flat, with gold trading on a level of 1241.30$ per troy ounce, and silver bargaining next to the level of 19.89$ per troy ounce.

Copyright: MAYZUS Investment Company Ltd

 

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23 January 2014: Consolidation Proceeds In The Markets

DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.

Since the beginning of the week, at the key European and American exchanges, there has not been anything interesting happening. Yesterday, stock indices were moving in different directions, but in general they are consolidating next to the maximum levels of the last year. Optimistic forecasts regarding improvement of the economy of the developed countries this year, haven't given investors a reason to transfer to safer instruments, like gold or treasury bonds. The attention of the market is directed towards the upcoming meeting of the FED, which is going to be next week.

Yesterday’s trading session in Europe came to an end with multidirectional movement of indices. The interest of investors was down to statistics on the labor market of Great Britain, the indicator made 7.1% instead of the expected 7.3%, however this data was not supporting indices for a long time. By closing, the English FTSE100 index decreased by 0.12%, the French CAC40 grew by 0.03%, and the German DAX decreased by 0.1%.

In the USA, indices also couldn't show uniform dynamics, buyers nevertheless prevailed. Dow Jones decreased by 0.25% to the level of 16373.34 points, S&P 500 grew by 0.06% reaching the level of 1844.86 points, and Nasdaq Composite grew by 0.41% to the level of 4243.00 points.

Data published this morning from China brought disappointment to the markets. The PMI index for the production sphere, counted by HSBC bank in January, fell to a level of 49.6 points, which is significantly weaker than the forecast of 50.3 points. Business activity in the country showed the first decrease for the last 6 months. Naturally, on Thursday morning, the markets reacted to this news negatively, and pushed Asian stock indices to go down, with Nikkei loosing 0.65%, ASX falling by 1.1% and CSI decreasing by 0.6%.

Prices of oil managed to restore some loses and are showing positive dynamics. The international Power Agency raised the forecast of world consumption of oil to 1.3 million barrels per day. This morning, Brent is traded on a level of 108.25$ per barrel, WTI is up by 0.10% on the level of 96.83$ per barrel.

Today, investors attention will be on statistics from Europe, where the data on the index of business activity in the industry and the services sector of Great Britain and the Eurozone, is going to be published. In the USA, payrolls for the last week, and data on oil stocks will be presented later on throughout the day.

Copyright: MAYZUS Investment Company Ltd

 

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24 January 2014: Markets Are Planning Correction Before Meeting Of FED

DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.

Yesterday, the main stock indices of the USA were traded in negative territory. During the day, data was presented from the National Association of Realtors (NAR) on sales of houses in the secondary market, which showed that they did not change in December. According to the report, sales of existing houses grew in December by 1.0% in comparison with last month, having reached an annual level of 4.87 million units, when an increase to the level of 4.99 million units was forecast.

Following the results of the trading session, the indicator of blue chips, Dow Jones Industrial Average, went down by 1.07% to the level of 16197.35 points. The index of the wide market Standard & Poor's 500 decreased by 0.89% to a level of 1828.46 points, and the index of high-tech industries of Nasdaq Composite went to a minus on 0.57% and reached the level of 4218.87 points.

In the currency market, during yesterday’s trading session, the EUR/USD pair grew by 170 points to the level of 1.3696, traded this morning on a level of 1.3673. The Euro got stronger after the publication of data on the PMI index in the Eurozone. The summary index of 18 countries of the Eurozone in January, grew to the level of 53.2 points, which is the highest level since June, 2011.

Prices of gold sharply raised yesterday against the essential fall of the dollar, the price for a troy ounce added 2% and rose above the level of 1260,00$. This morning, prices of gold are flat and are traded with a small decrease of 0.23% on a level of 1259.36$ per troy ounce.

Today’s trading day is not very interesting, from the publication of macroeconomic statistical data point, but the upcoming meeting of the FED is already having an influence on the moods in the markets. The upcoming meeting is the first meeting this year and the last meeting for Ben Bernanke. On the last meeting, he declared that the QE3 will probably be reduced at each subsequent meeting of the committee, but since that time a lot of news has been presented. Growth rates of employment were slowed down, a reduction of consumer demand in both the retail sector and the real estate sector has also been declared. The mass of doubt and uncertainty will most likely press on the American currency and the stock market up until the time of the next meeting.

Copyright: MAYZUS Investment Company Ltd

 

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27 January 2014: Meeting Of FED Will Start On Tuesday

DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.

On Friday, the trading session was exceptionally bad for the majority of the main stock markets of the world. The Dow Jones Industrial Average index showed the strongest fall since the 20th of June 2013, and lost 1.97%, reaching the level of 15879.11 points. The index lost 3.5% in a week, which became the worst week since November, 2011, with 4 days of decrease in a row. The S&P 500 decreased by 2.09%, reaching the level of 1790.29 points, and Nasdaq Composite lost 2.15% and finished the trading session on a level of 4128.17 points.

The situation in the European stock exchanges did not differ, indices significantly lost in value. Following the results of the session, the key index of Great Britain, FTSE 100, went down by 1.6%, the French CAC 40 lost 2.8%, and the German DAX went to a minus by 2.5%. The regional STXE 600 indicator, in turn, decreased by 2.4% and was closed on a level of 324.75 points.

Mainly, markets are showing negative dynamics due to fears concerning further prospects of the development of the economy in China, the sale of currencies of developing countries, and also expectations of a new stage of turning of the QE program by the FED. Extremely large sales of currencies of developing countries began after the publication by HSBC (preliminary data on the index of business activity in the industry of China), which testify delay of growth rates of the economy.

The situation in the Asian-Pacific Region this morning is following the American mood, Japanese Nikkei is losing around 2.51%, the Hong Kong Hang Seng is falling by more than 2%, and the Chinese Shanghai Composite is decreasing by 1.02%.

This week will be rather saturated with corporate events. Within the week, quarterly results will be presented by all main IT giants, including Apple. As has been mentioned many times before, the meeting of the FED, which will start tomorrow, is going to become a main event of the week in the markets. Naturally, further direction of the markets will depend on volumes of reduction of the QE3 program. There are not a lot of statistics expected to be published today. Data on the labour market, and sales of new houses is going to be published in the U.S, and the Index of business climate of IFO will be presented in Germany.

Copyright: MAYZUS Investment Company Ltd

 

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28 January 2014: Today, All Attention Will Be Directed Towards The FED Meeting

DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.

On Monday, the stock market of the United States of America continued last weeks fall, and finished the trading day in the red zone. The reasons for pessimism in the markets more or less remain the same: fears concerning further prospects of development of the Chinese economy, and expectations of a new stage of turning of the QE3. The two day meeting of the FED begins today, and even by tomorrow participants of the market will be able to see the results.

Following the results of the trading session, the Dow Jones Industrial Average index weakened by 0.26% and was closed on a level of 15837.88 points, the index of the wide market S&P 500 went to a minus by 0.49% to the level of 1781.56 points, and the index of the hi-tech companies, Nasdaq, receded by 1.08% to the level of 4083.61 points.

As for the European markets, even good statistics from Germany could not push European indices to go up, and the European platforms closed the trading session with a decrease. The index of business climate of IFO in Germany made 110.6 points, at the forecast of 110 points; the index of the current conditions didn't change, and the index of economic expectations grew to 108.9 points. As a result, DAX decreased by 0.46%, FTSE 100 fell to 1.7%, and CAC 40 lost 0.41%.

This morning,Asian stock markets bargain in a small plus. Most likely, it is a correction after the long fall of the indices. Growth of the main indices is insignificant, within 0.1%, and markets are just flat. The Japanese Nikkei grows by 0.12%, the Korean KOSPI by 0.3%, the Shanghai Composite index adds 0.08% and the Hang Seng increases by 0.07%.The Australian index, on the contrary, shows decrease, led by falling of quotations of the largest mining companies of the world, BHP Billiton and Rio Tinto, due to fears of reduction of orders from China.

The prices of commodities are stable. Brent this morning adds 0.18% and is traded on a level of 106.68$ per barrel, WTI is up by 0.08% on a level of 95.8$ per barrel. Gold is losing 0.24% and bargaining on a level of 1260.37$ per troy ounce, silver is up by 0.09% on a level of 19.81$ per troy ounce.

Copyright: MAYZUS Investment Company Ltd

 

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29 January 2014: Nervousness Is Increasing In The Markets

DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.

Yesterday, the main stock indices of the United States showed positive dynamics and finished the trading session with an increase for the first time in the few last sessions. Published statistical data on the index of consumer confidence for January raised from 77.5 points in December to 80.7 points, whereas analysts expected only 78.1 points.

Following the results of the session, the Dow Jones Industrial Average index increased by 0.57% and was closed on a level of 15928.56 points, the index of the wide market S&P 500 went to plus by 0.61% to the level of 1792.5 points, and the index of the hi-tech companies, Nasdaq, added 0.35% reaching the level of 4097.96 points.

The season of presentation of corporate quarterly results continues, and among other interesting facts, the largest pharmaceutical company in the USA, Pfizer, added 2.6%, after declaring that the profit made in the fourth quarter is 56 cents per share, which is better than market forecasts of 52 cents per share. In contrast, the trading session for the Apple Corporation was very unsuccessful, where quotations fell to 8% because iPhone sales did not reach forecast of the analysts, even by having reached a record level of 51 mln units.

European stock markets also had a chance to win back some losses obtained over the last few days. The London FTSE 100 index grew by 0.33%, the Parisian CAC 40 rose by 0.98%, and the Frankfurt DAX increased by 0.55%.

Oil quotations are moving in slightly different directions, having got support from cold weather in America, predicting an increase of demand for raw materials, but, at the same time, are restrained by expectations of growth of stocks of oil according to EIA, on 2.338 million barrels. This morning, Brent adds 0.09%, traded on the level of 107.50$ per barrel, and WTI is losing 0.14%, bargaining around 97.27$ per barrel.

In general, stock markets are going to feel some nervousness today, as the attention of participants of the markets is going to be directed to the results of the two day meeting of the FED. To remind you again, this meeting is the last for the current FED chairman - Ben Bernanke. The majority of the analysts are presuming that he is going to confirm his previous statements (that the American economy is recovering), which will be a supporting signal for the continuation of turning of volumes of the QE3 program.

Copyright: MAYZUS Investment Company Ltd

 

[MAYZUS.Neeraj]

30 January 2014: FED Cuts QE3 Program By Another 10 Billion Dollars

DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.

Yesterday, FED announced the decision on the reduction of the repayment of assets, by 10 billion dollars, to $65 billion dollars a month. This meant that the regulator ignored the weak statistical data that was presented, stating that the growth of economic activity was accelerated in recent quarters; indicators of the labor market had mixed character, but in general showed further improvement. Additionally, the interest rate was kept in its target range of 0%-0,25%, which coincided with the forecast.

Following the results of the trading session, the Dow Jones Industrial Average went down by 1.19% to the level of 15738.79 points, the index of the wide market Standard & Poor's 500 decreased by 1.02% to a level of 1774.20 points, and Nasdaq Composite went to a minus by 1.14% and reached the level of 4051.43 points.

European stock markets also came to an end in the red zone. The index of the London stock exchange, FTSE 100, fell by 0.43%, the Parisian CAC 40 fell by 0.68% and DAX fell by 0.75%.

The Asian markets, following American indices, began the day in a minus. The MSCI Asia-Pacific index lost 1.8%. Markets of South Korea and Taiwan were closed. In addition to the disappointing news, final PMI index from HSBC across China made 49.5 points, when forecasts were 50.5 points. Nikkei 225 lost 2.45%, and Shanghai Composite, 0.82%.

The FED meeting is finally over, and now investors are going to go back to following the publications of macroeconomic statistical data. Today, the following data is going to be published on: unemployment and preliminary data on inflation in Germany; business climate, consumer confidence and consumer inflation expectation in the Eurozone; preliminary estimate of gross domestic product for the IV quarter, primary requests for unemployment benefits, and data on consumer inflation in the U.S.

Copyright: MAYZUS Investment Company Ltd

 

[MAYZUS.Neeraj]

03 February 2014: January Appeared To Be Quite Inconsistent For The Markets

DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.

The American indices finished the last trading week in negative territory. Negative attitudes were brought to the market due to the fact that according to the presented data from the FED, the volume of the commercial debt papers of the American companies was reduced for the week to 1.014 trillion dollars. Besides that, pressure on the market increased due to the reporting period of large companies, whereby data appeared to be worse than forecasts. The American investment company KKR Financial Holdings, reported a decrease in quarterly profit from 77.01 million dollars to 61.99 million dollars. The Chevron oil company reported around a 32% falling of quarterly profit to 4.93 billion dollars.

As a result, indices closed the trading week with the Dow Jones industrial average index decreasing by 0.94% to the level of 15698.85 points, and over the week the loss was 1.1%. The Standard & Poor's 500 index decreased by 0.65% having closed at the level of 1782.59 points, loss over the week being 0.4%. The Nasdaq Composite index decreased 0.47% to a value of 4103.88 points, having lowered during the week by 0.6%.

The situation in the commodities market also became negative last week as both prices of oil and precious metals lost in value. This morning, Brent is bargaining next to the level of 105.55$ per barrel, losing 0.25%; WTI is down by 0.47% on the level of 96.24$ per barrel. Gold is up by 0.22% on a price of 1242.54$ per troy ounce and silver decreasing by 0.01%, traded on the level of 19.12$ per troy ounce.

Meanwhile, February will be saturated with events that will have an influence on the development in the markets. A large part of investors attention will be focused on the Congress of the US, who need to solve the issue of raising of the ceiling of the American national debt, before the end of the week. Investors will also take an interest in February's meetings of the European Central Bank and the Bank of England. Today, it is worth paying attention to indices of business activity in the industrial sector of Germany, the Eurozone and Great Britain, and the index of economic conditions of ISM in the production sphere in the USA.

Copyright: MAYZUS Investment Company Ltd

 

[MAYZUS.Neeraj]

04 February 2014: January Sales Continue On Stock Markets

DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.

On Monday, the main stock indices of Europe showed negative dynamics due to a heavy decrease in activity of the banking sector. From the macroeconomic statistics which were published yesterday, attention should be paid to indexes of business activity for January in the industries of Switzerland, Germany, Great Britain, and also as a whole the Eurozone. In the Eurozone, the indicator increased from 53.9 points to 54 points, in Switzerland from 55 points to 56.1 points, in Germany from 56.3 points to 56.5 points, and in Great Britain it decreased from 57.2 points to 56.7 points.

As a result, the index of Great Britain, the FTSE 100, went down by 0.7%, the French CAC 40 became 1.4% easier, and the German DAX went to a minus by 1.3%. The regional STXE 600 indicator decreased by 1.3% and was closed on a level of 318.21 points.

The situation in the American market also sharply weakened after the publication of an unexpectedly weak report on the industrial ISM index in the USA. In January, this indicator decreased from 56.5 points to 51.3 points, whilst analysts expected 56 points.

As a result, the Dow Jones Industrial Average index decreased by 2.08% to the level of 15372.8 points. The S&P 500 lost 2.28% reaching a level of 1741.89 points, and the Nasdaq Composite fell by 2.61% to the level of 3996.96 points.

Asian markets didn't have any other choice but to follow the negative European and American trading sessions. The MSCI Asia-Pacific index decreased by 2.3%, which is the strongest decrease in the past eight months. The Japanese Nikkei is losing 4.17% this morning , and Futsee-100 falls by 0.54%. Shanghai Composite also decreases by 0.82%.

Copyright: MAYZUS Investment Company Ltd

 

[MAYZUS.Neeraj]

05 February 2014: The Situation In The Stock Markets Is Stabilizing

DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.

Yesterday, participants of the markets finally calmed down, which helped indices to recover slightly from the falls of the last few days. Optimism was brought by macroeconomic statistical data which pleased investors. According to the published data, orders in the manufacturing industry were reduced in December by 1.5%, while analysts expected the fall of the indicator to be 1.7%.

Investors attention was also directed towards speeches from the representatives of the FED. In particular, the head of the FED of Richmond, Jeffrey Leker, noted that the American economy will continue its development, with a very slow rate, however, this will not affect decisions of the FED to continue to reduce the program. Accordingly to his estimates, gross domestic product of the country will grow in 2014 by 2%, and the rate of inflation in the next 1-2 years will reach the target level of 2%. At the same time, the head of the FED of Chicago, Charles Evans, declared that an increase of interest rate could be possible, but only in the long-term, and monetary policy will remain to be soft until the FED is sure that all necessary measures have been taken for achievement of maximum employment and price stability.

Following the results of the session, the Dow Jones Industrial Average index rose by 0.47% and was closed on a level of 15445.24 points. The index of the wide market S&P 500 went to plus by 0.76% to the level of 1755.2 points, and the index of the hi-tech companies, Nasdaq, increased by 0.87%, to a level of 4031.52 points.

Asian stock markets are recovering after a strong fall yesterday. The Japanese Nikkei adds 1.23%, the Korean KOSPI also grows. China is still celebrating New Year in the country. The Australian ASX200 and the Indian BSE Sensex are decreasing.

Today is going to be a very saturated day, statistical data wise. Indexes of business activity in the Eurozone, data of ADP Services on the labor market in the USA, and the ISM index in the non-manufacturing sector are expected.

Copyright: MAYZUS Investment Company Ltd

 

[MAYZUS.Neeraj]

07 February 2014: ECB Keeps Its Soft Stimulation Of The Economy

DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.

This morning, positive external background remains in the markets. Among the main factors pushing indices to move up, is the preservation of soft stimulating policy in the Eurozone and expectation of data on the level of Private Non-farm Payrolls and unemployment rate in the USA for December, which will be published in the second part of the day.

Yesterday, the European Central Bank declared preservation of the interest rate at the former level of 0.25%. At a traditional press conference, the president of ECB, Mario Dragi, confirmed that the bank will start to take measures only if forecasts on inflation will start to become worse, and turbulence of the currency market will increase. Inflation in the Eurozone was unexpectedly slowed down to 0.7% per annum following the results of December, which became its lowest value since 2009.

Published macroeconomic data in the U. S. yesterday was also rather positive, primary jobless claims made 331 thousand when what was expected was 335 thousands, decreasing by 20 thousand from last month. Non-farm Productivity made 3.2%, 2.5% was expected.

This helped American indices to close the trading session in a green zone. The Dow Jones industrial average index increased by 1.22% reaching the level of 15628.53, S&P 500 increased by 1.24% to the level of 1773.43 points, and Nasdaq Composite added 1.14% in value, finishing the trading session on a level of 4057.12 points.

Today, the attention of the investors is going to be directed towards employment change in the non-agriculture sector in January, which, with a high probability, will significantly affect both dynamics of the trading session in the USA, and closing of the European exchange markets. It is expected that growth of the number of workplaces in January made 185000, after growth of 74000 in December. Strong data could lead to a continuation of growth of profitability of state bonds. Weak numbers could raise doubts in expediency of turning of the QE program.

Copyright: MAYZUS Investment Company Ltd

 

[MAYZUS.Neeraj]

10 February 2014: The Labor Market Of The USA Was The Main Source Of A Positive In The Markets

DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.

On Friday, investors concentrated their attention on the publication of macroeconomic statistical data. Statistics on the labor market of the USA were weaker than predictions of analysts. Frosts again became the main reason why the quantity of created workplaces appeared below market forecasts. This time, around 262 thousand people could not come to work because of cold weather, which coincided with the figure recorded in December.

The Non-farm payrolls indicator made 113 thousand whereas 185 thousand were expected. The average hourly salary increased by 0.2%, having coincided with market expectations, and the average duration of the working week remained invariable at a rate of 34.4 hours. Among the positive data, it should be noted that the unemployment rate decreased from 6.7% to 6.6%.

As a result, the index of the wide market S&P 500 increased by 1.33% and finished the week on the level of 1786.58 points, the indicator of blue chips, the Dow Jones Industrial Average, grew by 0.5% to the level of 15705.84 points, and the index of high-tech industries, Nasdaq Composite, added 1.69% reaching a value of 4105.38 points.

Oil managed to increase in price due to the retreat of the dollar, and the remaining positive dynamics of the decrease in the unemployment rate in the USA. Brent this morning is traded on a level of 108.46$ per barrel, increasing by 0.36% and WTI is losing 0.16% traded on a level of 99.19$ per barrel.

Today we expect a rather quiet trading session, as there are not many important economic reports expected during the day. One of the most important events this week is going to be the press-conference of the new head of the FED, Janet Yellen. Undoubtedly, she will be asked questions concerning the plans of the FED in relation to the target levels of the labor market. Besides that, the publication of the report on retails is another important event of the current week.

Copyright: MAYZUS Investment Company Ltd