Ger30, UK100 and SP500 are CFD’s, written over the Dax30, Footsie100 and S&P500 Index futures:
European markets were trading lower. The sectors most vulnerable to investor sales should be the cyclical ones, with particular emphasis on the oil and mining sectors. Yesterday, oil declined by about 2 percent in the US session, after the International Energy Agency cut its oil demand projections to 2017 and 2018. These projections slightly cool the positive sentiment that was being built around it but also serves as a justification for several investors to realize capital gains after the strong gains accumulated in recent weeks. In fact, from 9 October to 7 November, Brent appreciated 16%. The weakness of oil is also negatively affecting other industrial commodities, so the mining sector may also be under pressure.
US markets ended the session with contained devaluations. The session was marked by the disappointment of Chinese economic data, the weakness of GE shares and the vicissitudes of fiscal reform in Congress. Economic data in China as well as reduced projections by the International Petroleum Agency have had a negative impact on oil and other industrial raw materials that depend in part on Chinese demand. In Washington, the tax reform process took on even more complex contours after Republican leaders pointed out that one way to fund this project is to change Obamacare. By reducing the number of Americans covered by Obamacare measures, public savings will be channeled into lowering taxes. In terms of disclosure of economic data, today’s agenda is the most relevant of the week due to the publication of the consumer price index. In September, the price of gasoline rose 13% due to strong demand from Americans who have moved away from the affected areas. Thus, it is expected that the price of gasoline normalized in October, suffering a decline that approached the average. Investors should therefore focus on the core CPI, that is, the one that purges the prices of more volatile goods such as gasoline.
Asian stocks traded lower, highlighting sharp Nikkei losses. The realization of capital gains continues to mark the current stock market situation, and this time the selling pressure was especially felt in oil and mining stocks. In Japan, the GDP for the third quarter of this year was published. In that period, the Japanese economy grew by 1.40%, marginally above the estimated 1.30%. This was the seventh consecutive quarter of economic growth, a positive series not seen in Japan since 2001.