Ger30, UK100 and SP500 are CFD’s, written over the Dax30, Footsie100 and S&P500 Index futures:
In the pre-opening, European indexes traded with reduced losses. Today in Spain will take place the vote on the formation of a government. It is important to note that during this year, the correlation between the various stock market indices has been high. The conclusion to be drawn from this observation is that the international situation is dictating the trend of the various stock markets. The specific events of a particular country only have a clear impact in the very short term and later determine just under or over-performance of the respective index compared to the others.
US markets closed down, prolonging the uncertainty that started in mid-August. Despite this uncertainty has been noted in recent days the weakness of some more defensive sectors which have been one of the best performers this year, signaling a warning for investors. The macroeconomic agenda yesterday was perhaps the least relevant of this intense week. The employment report, to be published on Friday, will be the protagonist of this week. The S & P / Shiller index which measures home prices in 20 major US metropolitan areas, increased 5.10% in June, in line with forecasts. Consumer confidence, as measured by the Conference Board, reached in August to 101.0, the highest level this year, comfortably beating forecasts of 97.30. At the enterprise level, the most important news was the fine imposed on Apple by the European Commission. The Cupertino company will have to pay a fine of 14,500 M.USD (plus interest) by the fact Irish State that has levied taxes on the very small profits (between 1% in 2003 up to 0005% in 2014), thus violating the European rules. Apple shares fell 0.77%. One factor that may affect the S & P’s behavior is the evolution of the ten-year treasury yields of US government bonds. Since mid-July, the yields to 10 years have fluctuated between 1.45% and 1.63%. If increases the prospects of a rise in interest rates by the Fed is not to exclude that yields exceed the 1.63%. This level is important from a technical point of view because if surpassed may signal an upward movement in yields. In this scenario, the impact on the stock market would be negative.
Asian markets closed mostly in low, with the exception of the Shanghai and Tokyo Stock Exchanges, which traded without major fluctuations. Today, the head office of the Bank of Japan, Yoshihide Suga, said that the institution is ready to intervene in the foreign exchange market to curb the appreciation of the yen, which has been one of the strongest currencies this year.