Ger30, UK100 and SP500 are CFD’s, written over the Dax30, Footsie100 and S&P500 Index futures:
In the pre-opening, the European markets negotiated slightly higher, despite the uncertainty that stems from the terrorist attack in London. The Pound depreciated to the lowest of the last six days against the US Dollar. Investors, however, should monitor developments in the US political-economic landscape.
For the fifth consecutive session, the US market traded yesterday in negative territory, although it ended in different directions. Some analysts said that this decline in the indexes is natural in the markets, but the curiosity of this drop is due to the fact that this is the first strong devaluation in more than 5 months. In fact, on Tuesday, the market halted a series of 109 consecutive sessions without a devaluation of at least 1%. To influence the sentiment have been concerns about Donald Trump’s program and it is in this context that today will be held the main event of the week: the congressional vote on the health system law. The key element of the Trump Rally was the expectation that the new President would implement a series of measures that would reduce taxes, reduce regulation, and build infrastructure. In fact, since the election of Donald Trump and in the following months the economic agents (investors, consumers, businessmen, etc.) were convinced that the fiscal policy of the new President would accelerate the economy and thus justify the fundamental and technical ratios that the stock prices reached. Given the scarcity of confirmations concerning the Trump Administration’s fiscal policy, it would be likely that this conviction could be shaken or corrupted causing a market correction. In March, the main US indices did not show any progress but also did not suffer any correction. After the sharp fall of the day before yesterday, some doubts seem to be emerging. Today’s vote may give some more insight into the timing and mold of Donald Trump’s economic and fiscal policy. According to the political agenda in Washington, Congress will debate health care law in the coming weeks and will later address the State Budget. If this timetable is delayed then there will be a risk that fiscal measures will only be discussed at the end of the summer and financial markets are generally not as patient. In terms of economic indicators, it was reported that during the month of February, sales of used houses decreased by 3.70% to 5.48 million, compared to 5.55 million expected. On the other hand, house prices remained unchanged in the first month of the year, compared with an estimated increase of 0.40%. For oil, a significant drop in the price of this raw material was observed during the session on the day the weekly inventories were published by the Department of Energy. Crude oil reserves increased by 5 million barrels (vs. 1.8 million barrels) in the week ending March 17, marking the 10th increase in 11 weeks. In turn, gasoline inventories fell by 2.8 million barrels, compared with an expected drop of 2.6 million barrels.
Most Asian markets ended on a positive note as investors waited to vote on the health care bill in Congress.