Weekly reviews

US markets updated historical highs, Yellen's speeches in the focus this week

On Friday, European stock markets showed slight gains amid growing metals market, and gaining oil. European corporation reports appeared to be good (French Ubisoft + 10%, ArcelorMittal: + 9,3%; Boliden: + 9,7%). Markets were also supported by China data on trade balance. However, the mood of the Friday’s trading and political concerns prevented European markets from more success. In contrast, US stock indexes updated historical maximums - investors priced in the positive news in regard to the tax change recently announced by the President.  Amid this sentiment, US market ignored statistical data. The consumer confidence index from the University of Michigan compared to the previous month decreased from 98.5 to 95.7 points.

Today, with the start of a new week, European stock indexes began trading in the green, as a positive response to the results of the two-day US-Japan summit. During the meeting, the US president Donald Trump refrained from harsh statements on trade, security and currency rates. The US president has remained faithful to the traditional course in its relations with Japan, and thus dispelled some fears for global trade. Global trade risks amid growing protectionism were on a very high level last two month. The situation with the Greek debt continues to evolve in a negative way. Last weekend, the Prime - Minister of Greece, Alexis Tsipras again criticized the International Monetary Fund and the German Finance Minister Wolfgang Schaeuble. Recall that the IMF gave the Greece government a week to resolve their disagreements over fiscal policy. Public debt in Greece over the last year rose by EUR 5 billion, and the end of December reached 326.36 billion euros. Greek question and political factors continue to be a risk factor for the European markets, which have a negative impact on the single European currency.

Oil prices are down after the strong gain on Friday. IEA report shows that the world's oil supply in January decreased by 1.5 million barrels. (Up to 96.4 million bbl. / Day), most of the decline  is due to OPEC countries. However, there is increasing growth in production in countries outside the cartel, mainly in the United States. Today, the focus of the market will be on monthly report from OPEC. Most likely the numbers will be similar to the data from the IEA so that the trade outlook for oil is still the same. Existing medium-range trade remains valid.

In the FOREX currency market, new week has started with  some local weakening of the US dollar. Trading is kept in narrow ranges with decreased activity in the first half of the day .

Last week, despite the restrained trading, result showed the market growth and the update of historic highs (US markets). The statistics for the most part continues to show strong numbers, and reporting season indicates a rise in corporate profits. Commodity markets have gained due to US currency weakening, mainly amid the local uncertainty in future Fed rate plans. If political risks will not remind of themselves - markets will show a strong and positive day. The old axiom of the market again in the play - buy on rumor - sell the fact. This week markets will focus on inflation data in the US and the Eurozone, the speeches of Fed J. Yellen. Also, the ECB will publish reports on their last meeting. The week promises to be interesting and volatile.

chart