Ger30, UK100 and SP500 are CFD’s, written over the Dax30, Footsie100 and S&P500 Index futures:
In the pre-opening, the European indices did not show a definite trend. The earnings season continues to be one of the central themes of the current stock market situation. Among the results that were published before the opening one should notice those of Siemens and Commerzbank. Oil, which has been another hot topic in recent sessions, traded with modest gains after pulling back yesterday in the US session, as a result of rising oil reserves in the country. Today will be marked by two relevant macroeconomic events. The first will be the publication of the ECB’s monthly bulletin (9.00). The second will be the release of the new economic projections of the European Commission (10:00 am).
US markets closed with contained valuations. Boosting the main indexes (which reached new record highs) was still the aftermath of the mergers and acquisitions announced in previous days. In the bond market, yields consolidated after the decline in recent days. Even so, banking stocks were under pressure. One of the great catalysts of the appreciation of the US banking sector in recent months has been the prospect of rising interest rates, which would allow a greater differential between the rates that banks charge and those that they pay, which would generate a higher financial margin. Thus, the current yield decline may delay this upward movement in interest rates that many investors are waiting for. In Washington, some events reminded investors of how tax reform can be a long and somewhat exhausting process. The budget committee warned that the proposed Republican tax reform would increase the public deficit by more than 300,000 M.USD than estimated by this proposal. Accordingly, the deficit threshold approved by the Senate (1 500 000 000 M.USD) would be exceeded. Today’s session is expected to be conditioned by the behavior of oil, the presentation of the results of some retailers such as Kohl’s and Macy’s (which signals the end of the earnings season), possible developments regarding the tax reform and news related to the visit President Trump to China.
Asian indices had one more session without oscillations. The highlight of the day was the publication of inflation in China. In October, the consumer price index rose 1.90%, surpassing forecasts. The producer price index increased by 6.90%, signaling that companies can not reflect the prices that practice the whole increase in production costs. Even with markets closed, investors are expected to follow developments in Donald Trump’s visit to China.