Ger30, UK100 and SP500 are CFD’s, written over the Dax30, Footsie100 and S&P500 Index futures:
In the pre-opening European markets traded with some gains, due to the good performance of Wall Street and Asian markets. While this is, at this stage the European markets are being driven by the prospect that the ECB implement in the coming months a new phase of its quantitative easing policy. With regard to the first hours of trading, it is expected that the European technology sector benefit from the good performance of the Nasdaq. The oil sector is expected to remain highlighted, due to the strong recovery of crude in recent sessions. Boosting oil was the strike of workers in this sector in Brazil and the disruption of crude oil transportation in Libya.
American indices closed higher, highlighting again the Nasdaq, which continues to reach new highs. However, it should be noted that the recent rise in the technological index was mainly due to the appreciation of its biggest companies like Apple, Microsoft, Amazon, and others. Several smaller technology companies are not following this behaviour. Another sector that was evident was the oil and mining, due to the strong appreciation of the oil. At the macroeconomic level, orders to industries during the month of September decreased by 1%, from an early break of only 0.90%. Auto sales increased 14% in October (above expectations) highlighting Toyota, Fiat Chrysler and Ford. The brand with weaker sales was Volkswagen. Today begins a long schedule of speeches from Fed members, which provides up to the end of the week at least 10 interventions. Today, attention should rest with the involvement of Janet Yellen to the House of Representatives (15:00), and also tomorrow in the Senate. Another event which will attract the attention of investors is the publication of the ADP report (sponsored by Automatic Data Processing and calculated in partnership with economists at Moody’s), which measures job creation in the private sector. Investors usually attach some importance to this indicator, despite its low correlation with the official employment report, to be released on Friday. Economists take advantage of the ADP report statements to improve their forecasts for the official employment report.
In China, investors reacted with enthusiasm to the PMI index, which have reached 52.0 in October, the maximum of the last 3 months. Furthermore, the positive sentiment was reinforced by the words of President Xi Jiping. The President of China stated that the annual growth of the country will not be lower to 6.50% over the next five years. Additionally, it was revealed that the President of the Central Bank of China wants to establish a closer relationship between Shenzhen and Hong Kong exchanges, which will enable greater access to investors resident in the latter square the Chinese stock market.