CFD Markets News and Forecasts — 31-05-2017

(raw materials / closing price /% change)

Oil 48.63 +0.64%

Gold 1,267.90 -0.32%

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

Nikkei -27.28 19650.57 -0.14%

TOPIX -4.30 1568.37 -0.27%

Hang Seng -40.98 25660.65 -0.16%

CSI 300 +12.45 3492.88 +0.36%

Euro Stoxx 50 -6.63 3554.59 -0.19%

FTSE 100 -6.56 7519.95 -0.09%

DAX +16.38 12615.06 +0.13%

CAC 40 -22.31 5283.63 -0.42%

DJIA -20.82 21008.65 -0.10%

S&P 500 -1.11 2411.80 -0.05%

NASDAQ -4.67 6198.52 -0.08%

S&P/TSX -22.44 15349.91 -0.15%

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

EUR/USD $1,1242 +0,56%

GBP/USD $1,2873 +0,59%

USD/CHF Chf0,9676 -0,78%

USD/JPY Y110,83 -0,01%

EUR/JPY Y124,60 +0,55%

GBP/JPY Y142,67 +0,58%

AUD/USD $0,7430 -0,40%

NZD/USD $0,7082 -0,18%

USD/CAD C$1,3494 +0,21%

00:30 Japan Manufacturing PMI (Finally) May 52.7 52

01:30 Australia Retail Sales, M/M April -0.1% 0.3%

01:45 China Markit/Caixin Manufacturing PMI May 50.3 50.1

05:45 Switzerland Gross Domestic Product (YoY) Quarter I 0.6% 1.3%

05:45 Switzerland Gross Domestic Product (QoQ) Quarter I 0.1% 0.4%

06:00 United Kingdom Nationwide house price index May -0.4% -0.1%

06:00 United Kingdom Nationwide house price index, y/y May 2.6% 2.5%

07:15 Switzerland Retail Sales (MoM) April 0.7%

07:15 Switzerland Retail Sales Y/Y April 2.1% 2.4%

07:30 Switzerland Manufacturing PMI May 57.4 57.8

07:50 France Manufacturing PMI (Finally) May 55.1 54

07:55 Germany Manufacturing PMI (Finally) May 58.2 59.4

08:00 Eurozone Manufacturing PMI (Finally) May 56.7 57

08:30 United Kingdom Purchasing Manager Index Manufacturing May 57.3 56.5

12:15 U.S. ADP Employment Report May 177 185

12:30 U.S. Continuing Jobless Claims 1923 1920

12:30 U.S. Initial Jobless Claims 234 239

13:45 U.S. Manufacturing PMI (Finally) May 52.8 52.5

14:00 U.S. Construction Spending, m/m April -0.2% 0.5%

14:00 U.S. ISM Manufacturing May 54.8 54.5

15:00 U.S. Crude Oil Inventories May -4.432

19:00 U.S. Total Vehicle Sales, mln May 16.88 16.9

Major US stock indexes fell slightly as financial stocks fell in price as JPMorgan and Bank of America hinted at weak revenue in the current quarter.

The focus was also on the Fed's Beige Book. It reported that in some regions of the US there was a slowdown, and some companies have become less optimistic about their prospects. According to the Federal Reserve, the economic growth in 7 regions was modest, with moderate growth in 4 regions. The companies were still positive about their prospects, although some were less optimistic compared to the earlier period this year. The demand for labor in the regional labor markets continued to grow, and in most regions there was a shortage of workers in an increasingly wide range of occupations.

In addition, according to the National Association of Realtors, unfinished transactions for the sale of housing in April fell for the second month in a row and decreased compared to the previous year at the national level and in four main regions. The expected domestic sales (PHSI) index, the forecast figure based on the signing of the contract, in April fell by 1.3% to 109.8 from the revised level of 111.3 in March. In April, the index was 3.3% lower than last year, which is the first annual decline since December and the biggest decline since June 2014 (7.1%).

Oil prices fell by about 3% to a 3-week low, as news that oil production in Libya has recovered from technical problems has increased concerns that OPEC's efforts to cut production may be leveled by producers who do not participate in the Deal.

Components of the DOW index showed mixed dynamics (13 in negative territory, 17 in positive territory). Most fell shares of The Goldman Sachs Group, Inc. (GS, -3.46%). Leader of growth were the shares of Pfizer Inc. (PFE, + 1.63%).

The S & P indexes closed mixed. The sector of main materials fell most of all (-0.5%). The leader of growth was the healthcare sector (+ 0.5%).

At closing:

DJIA -0.09% 21,011.15 -18.32

Nasdaq -0.08% 6,198.52 -4.67

S & P -0.04% 2.411.93 -0.98

The MNI Chicago Business Barometer decreased to 55.2 in May from 58.3 in April, the lowest level since January. Optimism among firms about business conditions eased for the first time in four months. Three of the five Barometer components led May's decline, with Order Backlogs and Supplier Deliveries increasing.

After rising for three consecutive months, demand lost ground in May. New orders fell by a hefty 9.6 points, to hit the lowest level since January. In line with lower orders, Production also receded, although by a softer margin.

Pending home sales in April slumped for the second consecutive month and were down year-over-year nationally and in all four major regions, according to the National Association of Realtors. Only the West saw an increase in contract signings last month.

The Pending Home Sales Index, a forward-looking indicator based on contract signings, decreased 1.3 percent to 109.8 in April from a downwardly revised 111.3 in March. After last month's decline, the index is now 3.3 percent below a year ago, which is the first year-over-year decline since last December and the largest since June 2014 (7.1 percent).

Lawrence Yun, NAR chief economist, says contract activity is fading this spring because significantly weak supply levels are spurring deteriorating affordability conditions. "Much of the country for the second straight month saw a pullback in pending sales as the rate of new listings continues to lag the quicker pace of homes coming off the market," he said. "Realtors are indicating that foot traffic is higher than a year ago1, but it's obviously not translating to more sales."

• Says only poll that matters is the election on June 8

U.S. stock-index futures were rose moderately amid tumbling oil prices and reports that President Trump had decided to pull out of the Paris climate accord.

Stocks:

Nikkei 19,650.57 -27.28 -0.14%

Hang Seng 25,660.65 -40.98 -0.16%

Shanghai 3,117.48 +7.42 +0.24%

S&P/ASX 5,724.57 +6.69 +0.12%

FTSE 7,578.24 +51.73 +0.69%

CAC 5,331.54 +25.60 +0.48%

DAX 12,690.07 +91.39 +0.73%

Crude $48.65 (-2.03%)

Gold $1,268.10 (+0.18%)

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

Real gross domestic product (GDP) increased 0.5% in March, following no change in February. Growth was widespread across goods-producing and service-producing industries.

Goods-producing industries grew for the fourth time in five months, increasing 0.9% in March, while service-producing industries rose 0.3% in March and have grown continuously since September 2015.

The manufacturing sector was the largest contributor to the growth in GDP in March, growing 1.6% and more than offsetting a 1.0% contraction in February.

Non-durable manufacturing (+1.7%) rose for the fourth time in the last five months based on widespread growth. With the exception of paper manufacturing, all subsectors posted gains, led by chemical products (+2.4%), petroleum and coal products (+2.6%) and plastic and rubber products (+2.4%). Food manufacturing rose 0.9% as seven of nine industry groups registered growth.

• Attack was directly by German embassy, hit civilians and others working for better future for Afghanistan, it's particularly despicable that these people were targeted

• Public debt is serious source of vulnerability, must be cut faster

The euro area (EA19) seasonally-adjusted unemployment rate was 9.3% in April 2017, down from 9.4% in March 2017 and down from 10.2% in April 2016. This is the lowest rate recorded in the euro area since March 2009. The EU28 unemployment rate was 7.8% in April 2017, down from 7.9% in March 2017 and from 8.7% in April 2016. This is the lowest rate recorded in the EU28 since December 2008. These figures are published by Eurostat, the statistical office of the European Union.

Eurostat estimates that 19.121 million men and women in the EU28, of whom 15.040 million in the euro area, were unemployed in April 2017. Compared with March 2017, the number of persons unemployed decreased by 253 000 in the EU28 and by 233 000 in the euro area. Compared with April 2016, unemployment fell by 2.225 million in the EU28 and by 1.529 million in the euro area.

Euro area annual inflation is expected to be 1.4% in May 2017, down from 1.9% in April 2017, according to a flash estimate from Eurostat, the statistical office of the European Union.

Looking at the main components of euro area inflation, energy is expected to have the highest annual rate in May (4.6%, compared with 7.6% in April), followed by food, alcohol & tobacco (1.5%, stable compared with April), services (1.3%, compared with 1.8% in April) and non-energy industrial goods (0.3%, stable compared with April).

In April 2017, 22.998 million persons were employed, +0.4% over March 2017. Unemployed were 2.880 million, -3.5% over the previous month.

Employment rate was 57.9%, +0.2 percentage points over March 2017, unemployment rate was 11.1%, -0.4 percentage points over the previous month, and inactivity rate was 34.7%, +0.1 percentage points in a month.

Youth unemployment rate (aged 15-24) was 34.0%, unchanged over March 2017 and youth unemployment ratio in the same age group was 8.8%, -0.2 percentage points in a month.

Broad money, M4 excluding intermediate other financial corporations, increased by £9.0 billion in April, with positive flows for all sectors. Within this, households' M4 flows, at £4.4 billion, were slightly higher than recent weak outturns whilst private non-financial corporations' (PNFCs') M4 flows strengthened further to £3.8 billion.

Sterling lending to the UK private sector excluding intermediate other financial corporations, M4Lex, increased by £3.9 billion in April. Net lending flows to households and PNFCs were slightly lower than last month at £3.6 billion and £1.0 billion respectively, the former being the lowest since April 2016.

Net lending secured on dwellings in April was £2.7 billion, the lowest since April 2016.

Approvals for house purchase and remortgaging loans fell further in April, to 64,645 and 40,575 respectively.

The flow of consumer credit was similar to its recent average in April, at £1.5 billion; the annual growth rate was broadly unchanged.

Loans to large non-financial businesses increased by £2.1 billion in April, mainly reflecting lending to the public administration and defence sector . Loans to small and medium-sized enterprises decreased by £0.3 billion..

• I have expectation of balanced market in very near future

• We are committed to bringing oil inventories down to a five year average

• We want to institutionalise cooperation between OPEc and non OPEC producers

Over a year, the Consumer Price Index (CPI) should slow down in May 2017 (+0,8% after +1.2% in April) according to the provisional estimate made at the end of the month. This drop in year-on-year inflation should come from a marked slowdown in energy prices and a moderate one in food and tobacco prices. Manufactured product prices are set to decrease again, at the same pace as in the previous month. Services prices should grow as much as in April.

Over one month, consumer prices should rise by 0.1%, as in April. This slight increase should be due to a rebound in food prices, offset by a marked drop in energy prices and a slight downturn in these of tobacco. Services prices are set to slow down slightly owing to a downturn in airfares and communications services. Lastly, the rise in manufactured product prices should stay very moderate.

Year on year, the Harmonised Index of Consumer Prices should slow sharply, to +0.9% after +1.4% in the previous month. Over one month, it should be stable, after +0.1% in April.

• You are certainly seeing bottlenecks in construction sector

• DTI consultation paper is with minister of finance, I suspect paper will be released within the next couple of weeks

• Deputy governor Grant Spencer says we wouldn't necessarily have specific threshold attached to debt to income ratio restrictions

• Wheeler says there has been no U.S. mention that China is a currency manipulator, which is helpful language

• It's not just the U.S. there are issues around China and debt situation, around North korea and middle east

• Wheeler says I think there is still a great deal of uncertainty about where the U.S. might go on trade policy

• The risk to global trade and economic growth from the introduction of protectionist policies in the US appears to have receded for now

• In the US, an overall increase in housing and business capital investment suggest that the first quarter slowdown will be temporary

• Expects weaker growth in UK as investment spending slows as Brexit negotiations get underway,consumers feel impact of accelerating inflation

• Brexit-related slowdown in the U.K. has been more modest and Moody's has raised its forecast for growth this year to 1.5% from 1%

• Risk of major euro area country leaving EU is no longer an immediate concern, with the election of emmanuel macron as president in France

"New Zealand's financial system remains sound and is operating effectively. Banking system profitability has fallen modestly as a result of declining net interest margins, but remains robust. The banking system appears to be operating efficiently when compared to other OECD countries, based on metrics such as cost-to-income ratios, non-performing loans and the spread between loan and deposit rates. Banks have tightened credit conditions in response to slowing deposit growth and elevated credit risks in the property development and dairy sectors. Solvency margins have fallen in the insurance sector, but the sector remains well positioned to absorb the costs of the Kaikoura earthquake.

The outlook for the global economy has improved since the last Report, but global political and policy uncertainty remains elevated and debt burdens are high in a number of countries. A sharp reversal in risk sentiment could lead to higher funding costs for New Zealand banks and an increase in domestic borrowing costs. Rising protectionism could also affect the trade-exposed sectors of the New Zealand economy.

Against this backdrop, New Zealand's financial system remains exposed to three key risks: housing market vulnerabilities, bank funding pressures and dairy sector indebtedness. While these risks have reduced in the past six months, they remain elevated".

EUR/USD

Resistance levels (open interest**, contracts)

$1.1327 (5054)

$1.1263 (4933)

$1.1226 (5758)

Price at time of writing this review: $1.1175

Support levels (open interest**, contracts):

$1.1108 (2345)

$1.1073 (2435)

$1.1033 (1653)

Comments:

- Overall open interest on the CALL options with the expiration date June, 9 is 80957 contracts, with the maximum number of contracts with strike price $1,1000 (5959);

- Overall open interest on the PUT options with the expiration date June, 9 is 102696 contracts, with the maximum number of contracts with strike price $1,0700 (5491);

- The ratio of PUT/CALL was 1.27 versus 1.25 from the previous trading day according to data from May, 30

GBP/USD

Resistance levels (open interest**, contracts)

$1.3102 (3110)

$1.3004 (4083)

$1.2907 (2272)

Price at time of writing this review: $1.2808

Support levels (open interest**, contracts):

$1.2697 (1962)

$1.2598 (1550)

$1.2499 (1886)

Comments:

- Overall open interest on the CALL options with the expiration date June, 9 is 36164 contracts, with the maximum number of contracts with strike price $1,3000 (4083);

- Overall open interest on the PUT options with the expiration date June, 9 is 36762 contracts, with the maximum number of contracts with strike price $1,1500 (3061);

- The ratio of PUT/CALL was 1.02 versus 1.01 from the previous trading day according to data from May, 30

* - 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.

After reaching 51.8 in March, the highest level in almost five years, China's manufacturing PMI went down to 51.2 in April. The latest reading indicates that the growth in the manufacturing sector in China has moderated recently.

10 of the 13 sub-indices were lower than their respective levels in the previous month, while 2 sub-indices were higher than their respective levels in the previous month. The new orders index and the new export orders index dropped by 1.0 pt and 0.4 pts respectively in April, showing that the growth rates for both new domestic and export orders have decelerated recently.

Against this backdrop, the output index slid 0.4 pts in April, indicating a moderation in growth in output. Meanwhile, the input prices index fell sharply from 59.3 in March to a ten-month low of 51.8 in April, showing that upstream cost pressure has eased lately. This may be one of the biggest reasons behind a fall in ex-factory prices of industrial products: the ex-factory prices index dropped below the critical 50-mark in April.

The UBS consumption indicator stood at 1.48 points in April, indicating average private consumption growth. The improved mood in the retail sector supported the indicator, while a decline in new car registrations had a negative effect. The index of consumer sentiment measured by the State Secretariat for Economic Affairs also fell slightly. The March figure was revised slightly lower, from 1.50 to 1.44.

New car registrations in April were down 10% from the previous year, or by almost 3,000 vehicles. Owing to the late Easter, however, April this year had three fewer working days than last year, when Easter fell in March. Thus, the demand for cars may have been greater than the number of new car registrations would suggest, since more than 1,200 new vehicles were registered on average per working day in 2016. On the other hand, tourism may have benefited from the additional public holidays in April, after the number of overnight stays in hotels by Swiss residents fell by 0.3% this March compared to the previous year.

According to provisional data turnover in retail trade in April 2017 was in real terms 0.9% smaller and in nominal terms 0.6% larger than that in April 2016. The number of days open for sale was 23 in April 2017 and 26 in April 2016.

Compared with the previous year, turnover in retail trade was in the first four months of 2017 in real terms 0.5% and in nominal terms 2.5% larger than in in the corresponding period of the previous year.

When adjusted for calendar and seasonal variations (Census-X-12-ARIMA), the April turnover was in real terms 0.2% and in nominal terms 0.3% smaller than that in March 2017.

European stocks dropped almost across the board on Tuesday, with banks leading the charge lower after a broker downgrade and concerns over a potential early election in Italy. Renewed concerns that Greece may not make its next debt repayment also weighed on investor sentiment in Europe.

U.S. stocks closed moderately lower Tuesday as energy shares weighed on Wall Street, helping to halt a seven-session streak of advances for the S&P 500 and Nasdaq Composite. However, the overall slump in equities didn't prevent a record-setting performance by a handful of technology shares. Overall, market activity was muted following the three-day weekend in observance of Memorial Day, with trading volume relatively light.

Asian stocks climbed on Wednesday, capping a fifth consecutive month of gains, as data showed China's factory activity grew at a steady clip this month, bucking expectations of a slowdown.