Weekly reviews

Markets under pressure amid conservative sentiment growth

On Friday, global markets moved to partly taking profits on weak financial statements from UBS and continued oil decline. US markets closed without showing significant results. Friday US economic data have been mixed. The data showed that US economic growth slowed more than expected in the fourth quarter. Gross domestic product rose by 1.9% per year, below the 2.2% growth expected by economists and below the previous value of 3.5% per annum, in the third quarter. US President Trump met with British Prime Minister, the leaders discussed the possibility of concluding new trading agreement. Such an agreement is now possible, as the UK prepares to leave the European Union. It creates the impression that the investors decided to wait and to observe how will the relations between corporations and Donald Trump’s administration develop .

Today, European markets started the new week in negative territory, under the influence of geopolitical risks after the US President's decisions on migration policy and in anticipation of central banks’ meetings in the US and Japan. Trump’s decision on banning the immigration from seven Muslim countries led to criticism from some governments and some companies, resulting in geopolitical concerns. US markets futures traded in the red zone today.

The oil market continues to trade within the boundaries of the medium-term channel. ($ 54- $ 56.60) News background for the oil market remains negatively reserved. Friday's data showed an increase in number of drilling rigs up to 15. There is an increasing risk of US shale oil production growth and the pressure on the oil market. According to our expectations, the oil will go to the consolidation around balance level of the medium-term channel. ($ 55.55)

The Federal Reserve, the Bank of Japan and Bank of England will hold a meeting this week. Despite the fact that analysts do not expect a change in interest rates, the statement following the meeting, will be analyzed for further understanding of global regulators’ strategy. We expect increased trading volatility this week. FOREX currency market was consolidating the second part of the last week. As we expected, the dollar index found support at around 100 points. Global market sentiment remains positive. However, there is increasing market vulnerability to technical factors - markets are overbought. Today, the market will focus on a small portion of the American economy data. The global banks actions and D.Trump’s  policy will remain keys factor for global markets this week.

chart 01.2017

chart 01.2017