Last closure
On Thursday, May 29, trades in USA have come to the end with growth, as investors speculated the economy is improving following a contraction in the first quarter. The U.S. economy contracted for the first time in three years from January through March as companies added to inventories at a slower pace and curtailed investment. Gross domestic product fell at a 1% annualized rate in the first quarter, a bigger decline than projected, after a previously reported 0.1% gain. Warmer weather and higher expectations failed to cause a meaningful surge in home sales. Signed contracts to buy existing homes increased just 0.4% in April. The expectation had been for at least a 2% gain sequentially. The Realtors' so-called pending home sales index is now 9.2% lower than April of 2013. The number of Americans filing claims for new jobless benefits fell last week and remained near prerecession levels, the latest sign that the labor market is showing signs of strength. Initial claims for unemployment benefits dropped by 27,000 to a seasonally adjusted 300,000 in the week ended May 24. Economists surveyed by The Wall Street Journal estimated claims would fall to 319,000 from the prior week. First-time claims for the May 17 week were revised up slightly to 327,000. On the day’s result, index Dow Jones rose by 0.39%, S&P has increased by 0.54%, Nasdaq grew by 0.54%.
European stock exchanges closed with mixed dynamics of main indexes, as data showed the U.S. economy contracted for the first time in 12 quarters while jobless claims declined last week. European Central Bank President Mario Draghi pledged to ease monetary policy in June if necessary. Markets in Austria, Luxembourg, Denmark, Finland, Iceland, Norway, Sweden and Switzerland were closed for the Ascension Day holiday. Spain's economy could continue to grow in coming quarters at a similar pace to the 0.4% growth registered in the first quarter. The 0.4% growth was compared with the previous quarter. On an annual basis the economy expanded 0.5% in the first quarter. On the day’s result, British FTSE rose by 0.29%, CAC 40 (France) has decreased by 0.02%, DAX (Germany) remained unchanged.
Junes’ contractual price on Brent oil, grew by $0.16 to $109.97 per barrel.
In Ukraine
Trades on the Ukrainian stock exchange opened by growth, day passed without certain dynamics. Value of the UX index has increased by 1.88% to 1237.14. Share trades capacity on the application market was equal to UAH 11.3 million. Trades capacity on the derivatives market was equal to UAH 5.6 million. Total trades capacity for yesterday — UAH 74.2 million.
From ten shares of an index basket, two have declined. Leaders of growth were shares of Enakievo Metallurgical Plant (+12.86%) and Alchevsk Metallurgical Plant (+6.57%). Worse than market looked shares of Donbasenergo (-0.81%).
The Cabinet of Ministers of Ukraine has recommended the National Commission for Energy Regulation from June 1, 2014 set new tariffs for households, permitting an increase in the minimum first tier tariffs to 23.7 kopecks per kilowatt-hour for apartments with electric stoves and to 30.84 kopecks per kilowatt without electric stoves, which is 10% up on the current tariffs. On Thursday terrorists shot down the Ukrainian Mi-8 helicopter in Sloviansk, Donetsk region, killing 12 servicemen, including National Guard General Serhiy Kulchytsky. One serviceman has survived. Ukraine's anti-terrorist forces after artillery and air bombardment destroyed the terrorists shot down the Mi-8 helicopter.
Premarket
External background at the opening is neutral. Talks between Russia, Ukraine and the European Commission to resolve a gas dispute will go ahead on Friday, the Commission said, as time runs out to avert a threat that Moscow could cut off supplies to Ukraine. Industrial output in Japan dipped 2.5% on month in April. That missed forecasts for a decline of 2.0% following the 0.7% increase in March. Germany's retail sales fell unexpectedly in April after rising for three consecutive months, official figures revealed Friday. Retail sales turnover declined by a real 0.9% from March, when it was up 0.1%. Sales were expected to rise by 0.2%. The Asian indexes are showing mixed dynamics today. Nikkei has lowered by 0.347%, Hong Kong Hang Seng increasing by 0.17%.
Futures on American indexes are decreasing today from 0.11% to 0.16%.
Russian indexes as of 10:02 a.m. are decreasing — RTS decreasing by 0.38%, MICEX lowers by 0.15%.
Our expectations
We expect opening of the Ukrainian market on neutral territory.
In Europe will be published index IFO in Germany (11:00 a.m.) and data on GDP in the U.K. (11:30 a.m.).
In the U.S. will be published core PCE price index (3:30 PM), personal spending (3:30 PM), and Chicago PMI (4:45 PM).
ITT Investment group
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