Russian-Ukrainian conflict is influencing every economic aspect…
What drives the market today?
Here’s what’s moving the market on April 27.
Japanese yen surged after BOJ’s monetary stimulus
The BOJ claimed that it will buy the unlimited amount of government bonds. The central bank also will boost purchases of corporate bonds and commercial paper. The BOJ took the same measures as other countries did to support the national economy amid the corona crisis. The BOJ targeted short-term interest rates at -0.1% and 10-year bond yields around 0%. The central bank also made the GDP forecast for 2020 to fall by 3.0 to 5.0 %. Surprisingly, the Japanese yen surged maybe because the BOJ decision was expected by investors or the reason was that oil price dropped.
WTI and Brent oil prices declined to 14.3 and 20 respectively. Nothing’s changed, all oil storages are full and nobody still doesn’t need it.
AUD and NZD rose as restrictions eased
European countries such as Italy, Spain, France and Germany have taken first little steps to ease restrictions and to reopen their economies. This optimism raised the risk appetite. Also, the Covidsafe app was launched in Australia. This app will help to trace people who have been in contact with coronavirus. It should help to battle with the coronavirus more efficiently. Also, Australia is closely linked to fast-recovering China. All these factors have helped aussie and also kiwi to gain.
Goldman foresees dark future for stocks
According to Goldman Sachs, the narrow breadth in S&P 500 signals future market drawdowns. Market breadth is a ratio that compares the total number of rising stocks to the total number of falling stocks. The opinion is based on the previous data as the breadth narrowed ahead of the recessions in 1990 and 2008 and during the economic slowdowns of 2011 and 2016. The investors concern that only 5 companies made 20% of the market capitalization and less than half members of S&P 500 were trading above their 50-day moving average, according to Bloomberg.
Last week was very interesting for the markets, as we saw the releases of the US Inflation and Disney’s earnings report. So let's see what we should await this week!
The US will reveal Non-farm payrolls on January 7, Friday, at 15:30 GMT+2 (MetaTrader time).
The US Institute for Supply Management will release ISM manufacturing PMI on July 1, 17:00 GMT+3.
The United States Bureau of Economic Analysis will release monthly Personal Consumption Expenditures (PCE) on June 30, 15:30 GMT+3.
The governor of the Bank of England, Andrew Bailey, will hold a speech on June 29 at 15:30 MT time (GMT+3).