This week in the markets: the central banks will set the tone.
The central banks in the US, UK and Japan will announce their interest rate decision this week.
On Tuesday, a two-day meeting of senior US Federal Reserve officials will begin, and they will announce whether they have decided to raise interest rates for the second time this year.
The analysts expect the bank to announce an interest rate hike even though some think it is too early because of slow inflation.
On Thursday, the Bank of England will announce its interest rate decision.
The estimates are that there will not be too many surprises, and the bank will not change the interest rate.
In Japan, the central bank will announce its monetary policy on Friday.
It does not appear likely to withdraw from expansionary monetary policy this year. Analysts estimate that there will be no significant movement in Japan in the coming months.
The British pound fell by 1.6% to $ 1.2747 as a result of the relative defeat of the Conservative Party in the UK elections.
Prime Minister Theresa May was betting that she would strengthen her party’s power in the House of Representatives, but Labor’s results showed that Labor was gaining strength.
The British pound is now 3.5% higher than it was at the beginning of the year and above $ 1.1821, the lowest in the past year, falling more than 10% after the referendum on exiting from the European Union.
Yesterday, Wall Street posted slight gains following the testimony of former FBI chief James Coomy about Trump’s contacts with Russia prior to the election.
The markets, in general, ignored the potential for political turmoil in his testimony.
The price of the oil holds steady at $ 45.61 for a WTI barrel.
The Euro is down by 0.2% to $ 1.12 and the Japanese yen retreated by 0.3% to 110.33 yen per dollar.
Moderate price rises are recorded on the Asian stock exchanges.
In Hong Kong and Singapore 0.3%, in Shanghai 0.1%.
Tokyo drops 0.4% after weaker-than-expected growth data in Japan.
The growth in Japan is significantly lower than originally estimated.
In the first quarter was much lower than previously estimated, according to government figures.
Japan’s GDP grew at an annual rate of 1%, while the initial estimate was 2.2% growth, with growth of 0.3%
The Japanese yen reported stronger import and export data than forecast for May, despite falling commodity prices, suggesting that its economy is performing better than estimated despite fears of a sharp slowdown.
Imports to China jumped by 14.8 percent in May, after rising 11.9 percent in April, while exports climbed 8.7 percent, both above expectations.
The country’s trade balance fell to $ 40.8 billion, while forecasts projected an increase to $ 46.3 billion.
In the forex markets relaxation – the pound sterling and the Euro are trading almost unchanged.
Euro at $ 1.1258, British pound at $ 1.2954.
Against the yen, the US dollar dropped 0.2% to 109.65 yen.
The Asian markets are trading this morning in a mixed trend.
Tokyo and Hong Kong remain stable, with a slight tendency for declines of up to 0.1%.
Shanghai adds nearly 1% and Singapore is up by 0.2%.
In the markets vigilance is evident ahead of three major events that will affect trading:
1.Britain’s general elections will be held tomorrow.
2.The ECB is expected to publish its policy decision.
3.James Coomy, the dismissed FBI chief, is supposed to testify about his talks with US President Donald Trump on ties with Russia.
The Crude oil, which rose almost by 2% yesterday, keeps to be steady this morning.
The Wall Street markets closed yesterday on declines at the backdrop of tensions in the Persian Gulf.
The Dow Jones Industrial Average fell by 0.2%.
The S&P 500 Index declined by 0.3% and the Nasdaq Composite Index fell by 0.2%.
The trading on the European stock exchanges is going down slightly.
London is down by 0.1%, Frankfurt is down by 0.4%, Paris loses 0.5%.
Investors are looking for a “safe haven” against the background of the US dollar’s slide to its lowest level in eight months and the fall in yields on US government bonds to its lowest level since November.
The yield on US 10-year bonds fell to 2.157% and the price of gold rose by 0.7% to $ 1289.19 per ounce, the highest since April 19.
The trading on the Asian stock exchanges is on the decline as the Japanese yen strengthens.
Tokyo closed down by 1%, Seoul weakened by 0.1%, Hong Kong rising by 0.2%, Shanghai trades unchanged, Singapore is down by 0.1% and Sydney plunged 1.5%.
The Oil traded slightly higher at the backdrop of tension in the Persian Gulf after Saudi Arabia, Egypt, the United Arab Emirates and Yemen yesterday announced the severing of diplomatic ties with Qatar.
Will Britain’s elections shake the markets?
After Wall Street and the European stock exchanges broke records last week, the trading will take place this week at the backdrop of Britain’s upcoming elections, as well as a host of macroeconomic data.
On Friday, Wall Street closed at a high on expectations of an interest rate hike in the US, despite a disappointing employment report.
In Europe, the stock exchanges in London and Frankfurt broke records, while the sterling fell in the wake of polls ahead of Thursday’s election in Britain.
On Wall Street, the reporting season is coming to an end as all major companies have already published their first quarter reports, and trading will be affected by macroeconomic data to be released this week in the US, including consumer credit, factory orders and wholesale inventories. GDP for the first quarter.
On the same day the ECB will announce its interest rate decision.
According to all assessments, interest rates in the euro zone are expected to remain unchanged at a record low.
The trading on the European stock exchanges opened with price hikes as investors’ eyes are on the US, where the employment report will be released today.
Most forecasts suggest that the US economy added 180,000 jobs in May, but after yesterday’s ADP private sector employment report surprised, some economists expect a positive surprise today.
The ADP Private Sector Employment Report indicated an addition of 253,000 jobs to the private sector, a figure significantly higher than analysts’ forecasts of only 185,000 jobs.
The Euro strengthened against the US dollar by 0.1% and traded around $ 1.1222. The British pound is down 0.1% against the dollar and is trading around $ 1.2866.
The trading in Asian stock exchanges was conducted with price hikes, and Tokyo crossed the 20,000 mark
Tokyo rose by 1.8%, Hong Kong adds 0.3% to its value, Shanghai was up by 0.1%, Sydney rose by 0.9% and Seoul gained 1.2%.