Ger30, UK100 and SP500 are CFD’s, written over the Dax30, Footsie100 and S&P500 Index futures:
In the pre-opening, European markets were rising, reflecting the appreciation of Wall Street. Removing much of the uncertainty about the Fed and prospects that the ECB expand its quantitative easing program, improve the environment for European markets. However, in the short term, investors will continue to show sensitivity to any development related to the attacks of Paris.
US markets ended up, because of the relatively calm reaction of European markets to the latest developments in Paris and the minutes of the last meeting of the Fed. This document showed that there is greater consensus within the Central Bank to increase interest rates in December, although this decision still depends on the evolution of the economy. More than the increase in interest rates that financial markets fear most is uncertainty. Since March until yesterday (possibly) the timing of the decision was always a constant unknown. The rise in interest rates should not have a significant impact on the American economy. Considering a timeline of one year if the rates are situated somewhere between 0.50% and 1% (according to the forecasts of economists), remain at historically low levels and as such should not significantly affect investment nor recourse to credit by households. The impact of rising interest rates should feel via appreciation of the dollar. However, this movement is already embedded part in the current quotation of the American currency. The appreciation of the dollar should feel more in terms of the results of American multinationals (by decreasing the profits generated outside the US) and emerging economies. The construction of new homes in October reached the minimum of the last seven months, mainly due to the drop in construction of single family homes (representing 75% of the housing market) in the South. In October, this index decreased by 11%, reaching 1.06 million units (annualized number) compared to 1.16 million estimated. The granting of building permits increased 4.10% in the same month, reaching 1.15 million (annualized number), slightly above the 1.14 estimated.
The Japanese market ended positive, given the appreciation of the dollar against the yen. The Bank of Japan maintained its policy of monetary stimulus, after the meeting held today.