CFD Markets News and Forecasts — 12-07-2017

(raw materials / closing price /% change)

Oil 45.46 -0.07%

Gold 1,219.70 +0.05%

(index / closing price / change items /% change)

Nikkei -97.10 20098.38 -0.48%

TOPIX -7.80 1619.34 -0.48%

Hang Seng +166.00 26043.64 +0.64%

CSI 300 -11.99 3658.82 -0.33%

Euro Stoxx 50 +50.75 3515.23 +1.46%

FTSE 100 +87.17 7416.93 +1.19%

DAX +189.56 12626.58 +1.52%

CAC 40 +81.53 5222.13 +1.59%

DJIA +123.07 21532.14 +0.57%

S&P 500 +17.72 2443.25 +0.73%

NASDAQ +67.87 6261.17 +1.10%

S&P/TSX -5.15 15143.99 -0.03%

(pare/closed(GMT +2)/change, %)

EUR/USD $1,1412 -0,46%

GBP/USD $1,2890 +0,35%

USD/CHF Chf0,9653 +0,19%

USD/JPY Y113,18 -0,68%

EUR/JPY Y129,17 -1,13%

GBP/JPY Y145,89 -0,33%

AUD/USD $0,7677 +0,55%

NZD/USD $0,7258 +0,51%

USD/CAD C$1,2744 -1,37%

01:00 Australia Consumer Inflation Expectation July 3.6%

02:00 China Trade Balance, bln June 40.79 42.44

06:00 Germany CPI, m/m (Finally) June -0.2% 0.2%

06:00 Germany CPI, y/y (Finally) June 1.5% 1.6%

06:45 France CPI, y/y (Finally) June 0.8% 0.7%

06:45 France CPI, m/m (Finally) June 0.0% 0.0%

07:15 Switzerland Producer & Import Prices, y/y June 0.1% 0%

07:15 Switzerland Producer & Import Prices, m/m June -0.3% 0%

08:30 United Kingdom BOE Credit Conditions Survey

09:00 U.S. IEA Monthly Report

12:30 Canada New Housing Price Index, MoM May 0.8%

12:30 Canada New Housing Price Index, YoY May 3.9%

12:30 U.S. Continuing Jobless Claims 1956 1950

12:30 U.S. Initial Jobless Claims 248 245

12:30 U.S. PPI excluding food and energy, Y/Y June 2.1% 2%

12:30 U.S. PPI excluding food and energy, m/m June 0.3% 0.2%

12:30 U.S. PPI, m/m June 0% -0.1%

12:30 U.S. PPI, y/y June 2.4% 1.9%

14:00 U.S. Federal Reserve Chair Janet Yellen Testifies

15:30 U.S. FOMC Member Charles Evans Speaks

17:00 U.S. FOMC Member Brainard Speaks

18:00 U.S. Federal budget June -88 -35

22:30 New Zealand Business NZ PMI June 58.5

The major US stock indices rose significantly, with the Dow reaching record highs after Federal Reserve Chairman Janet Yellen said interest rate hikes will be gradual.

In her prepared notes, Ms. Yellen noted that the labor market continues to strengthen, and the economy appears to be growing at a moderate pace, while inflation remains below the Fed's long-term goal of 2%. She also noted that the FOMC still believes that a further gradual rate increase may be appropriate in the next few years to achieve and maintain maximum employment and stable prices.

Attention of market participants also attracted the Fed's Beige Book, which reported that the labor market situation continued to improve, but the price pressure in most regions was moderate. According to the Fed, in June the growth rate of economic activity in 12 regions ranged from weak to moderate. In 6 regions, economic growth was small, in 4 regions - moderate, in 2 regions - weak. Meanwhile, many regions expect a slight or moderate increase in economic activity in the coming months.

The price of oil rose sharply after the data indicated a major drop in oil reserves in the US, but soon lost most of the earned positions, as investors switched their attention to the next increase in oil production in the US. The US Energy Ministry reported that in the week of July 1-7, oil reserves fell by 7.564 million barrels to 495.35 million barrels. Analysts had expected a reduction of only 3.225 million barrels.

Almost all components of the DOW index recorded a rise (29 out of 30). The leader of growth was the shares of E. I. du Pont de Nemours and Company (DD, + 2.82%). Outsider were the shares of JPMorgan Chase & Co. (JPM, -0.22%).

All sectors of S & P completed the auction in positive territory. The technological sector grew most (+ 1.4%).

At closing:

DJIA + 0.58% 21.532.65 +123.58

Nasdaq + 1.10% 6,261.17 +67.86

S & P + 0.74% 2.443.38 +17.85

U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) decreased by 7.6 million barrels from the previous week. At 495.4 million barrels, U.S. crude oil inventories are in the upper half of the average range for this time of year.

Total motor gasoline inventories decreased by 1.6 million barrels last week, but are in the upper half of the average range. Finished gasoline inventories increased while blending components inventories decreased last week.

Distillate fuel inventories increased by 3.1 million barrels last week and are above the upper limit of the average range for this time of year. Propane/propylene inventories increased by 1.7 million barrels last week but are in the lower half of the average range. Total commercial petroleum inventories decreased by 3.9 million barrels last week.

• Raises U.S. 2017 growth forecast to 2.2 pct from 2.1 pct, removes stimulus from expansionary U.S. fiscal policy assumed in earlier forecast

• Elevated geopolitical uncertainty still clouds global outlook, particularly for trade, investment

• Household spending likely to remain solid in months ahead, but pace is expected to slow over projection horizon

• Activity in housing sector has abated, largely as result of sharp declines in resales in toronto and surrounding area

• Growth is broadening across industries, regions and becoming more sustainable; adjustment to lower oil prices is largely complete

• Further adjustments to o/n rate will be guided by incoming data, keeping in mind continued uncertainty, financial system vulnerabilities

• Judges recent softness in inflation to be temporary, sees inflation close to 2 pct by mid-2018

"The Bank of Canada is raising its target for the overnight rate to 3/4 per cent. The Bank Rate is correspondingly 1 per cent and the deposit rate is 1/2 per cent. Recent data have bolstered the Bank's confidence in its outlook for above-potential growth and the absorption of excess capacity in the economy. The Bank acknowledges recent softness in inflation but judges this to be temporary. Recognizing the lag between monetary policy actions and future inflation, Governing Council considers it appropriate to raise its overnight rate target at this time.

The global economy continues to strengthen and growth is broadening across countries and regions. The US economy was tepid in the first quarter of 2017 but is now growing at a solid pace, underpinned by a robust labour market and stronger investment. Above-potential growth is becoming more widespread in the euro area. However, elevated geopolitical uncertainty still clouds the global outlook, particularly for trade and investment. Meanwhile, world oil prices have softened as markets work toward a new supply/demand balance.

Canada's economy has been robust, fuelled by household spending. As a result, a significant amount of economic slack has been absorbed. The very strong growth of the first quarter is expected to moderate over the balance of the year, but remain above potential. Growth is broadening across industries and regions and therefore becoming more sustainable. As the adjustment to lower oil prices is largely complete, both the goods and services sectors are expanding. Household spending will likely remain solid in the months ahead, supported by rising employment and wages, but its pace is expected to slow over the projection horizon. At the same time, exports should make an increasing contribution to GDP growth. Business investment should also add to growth, a view supported by the most recent Business Outlook Survey".

EURUSD: 1.1350 (EUR 405m) 1.1365-75 (890m) 1.1400 (660m) 1.1425-30 (1.1bln) 1.1450 (380m) 1.1500 (330m)

USDJPY: 112.50 (USD 185m) 112.70 (300m) 113.00 (380m) 113.30 (350m) 113.80(400m) 114.00 (325m)

GBPUSD: 1.2900 (GBP 300m) 1.3000 (545m)

EURGBP: 0.8860-70 (EUR 780m)

USDCHF: 0.9525 (USD 365m)

AUDUSD: 0.7530-40 (AUD 480m) 0.7600 (430m) 0.7625 (290m)

EURJPY: 129.00 (EUR 250m) 131.00 (180m)

U.S. stock-index futures rose as investors reacted positively to the Fed Chair Janet Yellen's prepared remarks for today's testimony before the House Financial Services Committee (14:00 GMP). The remarks did not provide anything surprising in terms of interest rate outlook or balance sheet normalization.

Global Stocks:

Nikkei 20,098.38 -97.10 -0.48%

Hang Seng 26,043.64 +166.00 +0.64%

Shanghai 3,198.03 -5.01 -0.16%

S&P/ASX 5,703.57 -55.20 -0.96%

FTSE 7,407.69 +77.93 +1.06%

CAC 5,203.36 +62.76 +1.22%

DAX 12,569.84 +132.82 +1.07%

Crude $45.68 (+1.42%)

Gold $1,216.70 (+0.16%)

• Proper size of balance sheet depends on 'as-yet-unknown factors' including future demand for bank reserves

• Fed would not need to raise rates 'all that much further' to reach current low estimates of the neutral Fed funds rate

• Economy picked up in second quarter aided by household spending, business investment and stronger global economy

• 'Roughly equal odds' of faster versus slower growth than fed currently projects

• Carefully montoring inflation though ascribes recent dip to 'a few unusual' price declines for particular items

(company / ticker / price / change ($/%) / volume)

Freeport-McMoRan (FCX) downgraded to Sell from Hold at Berenberg

• Brexit fisheries talks part of second phase of talks, EU will defend its interests

• UK must respect its international commitments on sea and fisheries

• Expect annual inflation to slow in q4 2017

• See higher inflation pressure in h1 2018 due to 2017 harvest losses

• Analysts are confident inflation would slow to 4 pct target by end of 2017

• Expect gdp growth at no less than 1.5 pct in 2017

In May 2017 compared with April 2017, seasonally adjusted industrial production rose by 1.3% in the euro area (EA19) and by 1.2% in the EU28, according to estimates from Eurostat, the statistical office of the European Union. In April 2017 industrial production rose by 0.3% in euro area and by 0.1% in the EU28. In May 2017 compared with May 2016, industrial production increased by 4.0% in both zones.

The increase of 1.3% in industrial production in the euro area in May 2017, compared with April 2017, is due to production of capital goods rising by 2.3%, durable consumer goods by 1.8%, non-durable consumer goods by 1.2%, energy by 0.9% and intermediate goods by 0.3%. In the EU28, the increase of 1.2% is due to production of capital goods rising by 2.0%, durable consumer goods by 1.8%, non-durable consumer goods by 1.0%, energy by 0.7% and intermediate goods by 0.6%. Among Member States for which data are available, the highest increases in industrial production were registered in Lithuania (+3.8%), Romania (+3.5%) and the Czech Republic (+3.3%), and the largest decreases in Portugal (-1.0%) and Malta (-0.9%).

Latest estimates show that average weekly earnings for employees in Great Britain in nominal terms (that is, not adjusted for price inflation) increased by 2.1% including bonuses, and by 1.7% excluding bonuses, compared with a year earlier.

Estimates from the Labour Force Survey show that, between November 2016 to January 2017 and February to April 2017, the number of people in work increased, the number of unemployed people fell, and the number of people aged from 16 to 64 not working and not seeking or available to work (economically inactive) also fell.

There were 31.95 million people in work, 109,000 more than for November 2016 to January 2017 and 372,000 more than for a year earlier.

The employment rate (the proportion of people aged from 16 to 64 who were in work) was 74.8%, the joint highest since comparable records began in 1971.

There were 1.53 million unemployed people (people not in work but seeking and available to work), 50,000 fewer than for November 2016 to January 2017 and 145,000 fewer than for a year earlier.

The unemployment rate (the proportion of those in work plus those unemployed, that were unemployed) was 4.6%, down from 5.0% for a year earlier and the joint lowest since 1975.

EURUSD: 1.1350 (EUR 405m) 1.1365-75 (890m) 1.1400 (660m) 1.1425-30 (1.1bln) 1.1450 (380m) 1.1500 (330m)

USDJPY: 112.50 (USD 185m) 112.70 (300m) 113.00 (380m) 113.30 (350m) 113.80(400m) 114.00 (325m)

GBPUSD: 1.2900 (GBP 300m) 1.3000 (545m)

EURGBP: 0.8860-70 (EUR 780m)

USDCHF: 0.9525 (USD 365m)

AUDUSD: 0.7530-40 (AUD 480m) 0.7600 (430m) 0.7625 (290m)

EURJPY: 129.00 (EUR 250m) 131.00 (180m)

• Potential for renewed market volatility from changing monetary conditions, unexpected turns in China's economic rebalancing

• There's uncertainty about direction of economic policy in some advanced economies, especially risk of inward-looking policies

EUR/USD

Resistance levels (open interest**, contracts)

$1.1571 (2743)

$1.1542 (2976)

$1.1524 (748)

Price at time of writing this review: $1.1465

Support levels (open interest**, contracts):

$1.1397 (1320)

$1.1364 (1766)

$1.1326 (2379)

Comments:

- Overall open interest on the CALL options and PUT options with the expiration date August, 4 is 60651 contracts (according to data from July, 11) with the maximum number of contracts with strike price $1,1500 (3879);

GBP/USD

Resistance levels (open interest**, contracts)

$1.2988 (1662)

$1.2964 (991)

$1.2928 (763)

Price at time of writing this review: $1.2821

Support levels (open interest**, contracts):

$1.2764 (605)

$1.2734 (2394)

$1.2700 (1647)

Comments:

- Overall open interest on the CALL options with the expiration date August, 4 is 23996 contracts, with the maximum number of contracts with strike price $1,3100 (2869);

- Overall open interest on the PUT options with the expiration date August, 4 is 22399 contracts, with the maximum number of contracts with strike price $1,2800 (2394);

- The ratio of PUT/CALL was 0.93 versus 0.94 from the previous trading day according to data from July, 11

* - The Chicago Mercantile Exchange bulletin (CME) is used for the calculation.

** - Open interest takes into account the total number of option contracts that are open at the moment.

The Westpac Melbourne Institute Index of Consumer Sentiment rose by 0.4% in July from 96.2 in June to 96.6 in July.

This is the eighth consecutive month where the Index has printed below 100 indicating that pessimists continue to outnumber optimists. The Index is not sending encouraging signals about the outlook for consumer spending. Having said that, developments around interest rates during the month could have been much more damaging for confidence than turned out to be the case. Banks increased rates on 'interest only' mortgages while there was considerable media speculation about prospects for rising rates overall.

As reported by the Federal Statistical Office (Destatis), the selling prices in wholesale trade increased by 2.5% in June 2017 from the corresponding month of the preceding year. In May 2017 and in April 2017 the annual rates of change were +3.1% and +4.7%, respectively.

From May 2017 to June 2017 the index did not change.

European stocks finished with losses Tuesday, as investors took a cautious approach ahead of U.S. Federal Reserve Chairwoman Janet Yellen's testimony to Congress. After the latest Fed minutes out last week, investors are still expecting the U.S. central bank to hike rates at least one more time this year, but they are waiting on clues as to the timing of the next tightening move.

The U.S. stock market remained resilient Tuesday with the Nasdaq extending its winning streak to a third session as a pair of political developments dominated the news cycle. The market had initially turned south after Donald Trump Jr. released a chain of emails regarding a meeting in June 2016 to discuss allegedly incriminating information about Hillary Clinton as part of the Russian government's support of his father's presidential candidacy.

Equity markets in Asia largely paused Wednesday after a strong start to the week, with stocks in Japan and Australia underperforming as their countries' currencies made gains. In a development in claims that Russia might have meddled in the 2016 U.S. election, Donald Trump's eldest son released correspondence on Tuesday that showed communication with a Russian government attorney.