CFD Markets News and Forecasts — 18-06-2018

Major US stock indexes mostly fell on Monday, as China's response to the tariffs imposed by the United States raised concerns about a possible trade war between the two largest economies of the world.

At the end of last week, the US president announced the introduction of a 25 percent duty on a number of Chinese goods worth $ 50 billion. In turn, China announced the introduction of retaliatory measures. Beijing decided to impose 659 US goods duties at the same 25%. The total value of American goods, which will affect this move, is also estimated at $ 50 billion.

A certain influence on the course of trading also provided data on the United States. The confidence of builders in the market of newly built houses for a single family fell by 2 points to 68 in June, according to the housing market index from NAHB / Wells Fargo. The decline was largely due to a sharp increase in prices for sawnwood, although the sentiment is maintained on a solid basis. "Builders are optimistic about housing market conditions, as consumer demand continues to grow," said NAHB chairman Randy Noel. However, builders are increasingly concerned that tariffs on Canadian timber and other imported products damage the affordability of housing. Record high prices for sawnwood have added almost 9,000 dollars to the price of a new house for one family since January 2017.

Most DOW components recorded a decline (19 out of 30). Outsider were shares of Intel Corporation (INTC, -3.36%). The leader of growth was shares of Chevron Corporation (CVX, + 1.56%).

Most sectors of the S & P finished trading in the red. The health sector showed the greatest decline (-0.8%). The commodities sector grew most (+ 0.7%).

At closing:

Dow 24,987.47 -103.01 -0.41%

S & P 500 2,773.87 -5.79 -0.21%

Nasdaq 100 7,747.02 +0.65 +0.01%

Builder confidence in the market for newly built single-family homes fell two points to 68 in June on the NAHB/Wells Fargo Housing Market Index (HMI). The decline was due in large part to sharply elevated lumber prices, although sentiment remains on solid footing.

"Builders are optimistic about housing market conditions as consumer demand continues to grow," said NAHB Chairman Randy Noel. "However, builders are increasingly concerned that tariffs placed on Canadian lumber and other imported products are hurting housing affordability. Record-high lumber prices have added nearly $9,000 to the price of a new single-family home since January 2017."

The people of Germany are turning against their leadership as migration is rocking the already tenuous Berlin coalition. Crime in Germany is way up. Big mistake made all over Europe in allowing millions of people in who have so strongly and violently changed their culture!

U.S. stock-index futures fell on Monday, amid heightened fears over escalated trade dispute between the U.S. and China.

Global Stocks:

• Says Successor Williams 'On Same Page' on Need to Fix Bank Culture

• Dudley: 'Very Proud of the Work' New York Fed Has Done on Bank Culture Issues

• New York Fed Has Helped Legitimize Idea of Improving Bank Culture in Face of Skepticism

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

Int'l Paper (IP) resumed with a Hold at Deutsche Bank; target $64

Walt Disney (DIS) downgraded to Sell at Pivotal Research Group; target $93

Intel (INTC) downgraded to Under Perform from Market Perform at Northland Capital

Chevron (CVX) upgraded to Outperform from Mkt Perform at Raymond James

UniCredit cuts its estimate for EUR/USD to 1.20 for the end of 2018, compared with previous guidance of 1.32. In 2019, EUR/USD is likely to reach 1.25 and not 1.36, as previously expected. "We continue to see the recent strengthening of the dollar as temporary as a fiscal expansion this late in the cycle is usually associated with forex weakness," UniCredit says. "However, the uncertainty surrounding the impact of higher U.S. tariffs on highly export-oriented regions, as well as increased political uncertainty in the eurozone, will likely lead to investment flows being less dollar-bearish - and less euro-positive - than we previously thought."

Appetite for carry trades is likely to go up after the European Central Bank said last week it wouldn't raise interest rates at least until after the summer of 2019, UniCredit says. Such a clear forward guidance is good for carry trades because it creates a low volatility environment, which supports carry returns. The carry trades are likely to be concentrated in the mid-section of the bond yield curve, UniCredit says.

• Hearing on whether Audi's Stadler will be remanded ongoing

• USD/TRY is trading above the opening level seen day of 300bps hike May 23

• Initial resistance @ May 24/25 highs 4.8071/30, then record 4.9290

Japan had a merchandise trade deficit of 578.321 billion yen in May, according to rttnews.

That missed expectations for a shortfall of 205.2 billion yen following the downwardly revised 624.6 billion yen surplus in April (originally 626.0 billion yen).

Exports climbed 8.1 percent on year, exceeding forecasts for 7.5 percent and up from 7.8 percent in the previous month.

Imports soared an annual 14.0 percent versus forecasts for 8.0 percent and up from 5.9 percent a month earlier.

EUR/USD

Resistance levels (open interest**, contracts)

$1.1775 (1268)

$1.1753 (768)

$1.1735 (393)

Price at time of writing this review: $1.1592

Support levels (open interest**, contracts):

$1.1551 (2072)

$1.1514 (4250)

$1.1474 (4731)

Comments:

- Overall open interest on the CALL options and PUT options with the expiration date July, 9 is 98455 contracts (according to data from June, 15) with the maximum number of contracts with strike price $1,1500 (4731);

GBP/USD

Resistance levels (open interest**, contracts)

$1.3467 (786)

$1.3416 (337)

$1.3361 (125)

Price at time of writing this review: $1.3269

Support levels (open interest**, contracts):

$1.3221 (1594)

$1.3190 (2523)

$1.3155 (1998)

Comments:

- Overall open interest on the CALL options with the expiration date July, 9 is 22454 contracts, with the maximum number of contracts with strike price $1,3650 (2460);

- Overall open interest on the PUT options with the expiration date July, 9 is 25830 contracts, with the maximum number of contracts with strike price $1,3250 (2523);

- The ratio of PUT/CALL was 1.15 versus 1.13 from the previous trading day according to data from June, 15.

* - 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.