Last closure
On Monday, Jun 16, trades in USA have come to the end with growth, as corporate deals and growth in American manufacturing overshadowed escalating tension in Iraq. Iraq’s sectarian violence showed no sign of abating, with Sunni Muslim militants and government forces fighting to control Tal Afar. Prime Minister Nouri al-Maliki, a Shiite, is fighting to reverse the advance of ISIL militants, who captured Iraqi’s largest northern city and other towns last week. Ukraine said, Russia cut natural gas supplies after demanding fuel payments be made in advance, the first time shipments have been affected in this year’s crisis in relations between the two countries. Tensions escalated at the weekend with 49 servicemen killed when pro-Russia fighters shot down an aircraft. US net long-term securities transactions totaled -$24.2bn in April compared with $4.1bn in March. US Industrial production rose a seasonally adjusted 0.6% from April. Capacity utilization ticked up 0.2% point to 79.1% in May. Manufacturing activity index in the New York Region continued to climb in June. Following a nearly four-year high of 19.0 in May, the so-called Empire State general business conditions index came out at 19.3 in June, suggesting that business conditions improved significantly for manufacturers in the region. On the day’s result, index Dow Jones rose by 0.03%, S&P has increased by 0.08%, Nasdaq grew by 0.24%.
European stock exchanges closed with decrease of main indexes, as Russia cut supplies of gas to Ukraine. Russia’s OAO Gazprom cut off gas supplies to Ukraine. The state-run energy company will continue to supply its customers in the European Union through the same pipeline. It warned the European Commission of possible risks to the transit of gas. The scale of the task facing Mario Draghi, president of the European Central Bank, in his attempt to prevent Europe sliding into a damaging deflationary spiral was underlined on Monday when new data showed inflation falling to a five-year low in May. Official data for the 18-member currency zone showed prices rose by just 0.5%, supporting concerns that consumers remain wary of spending while the economy appears weak. Germany's growth in the first quarter of 0.8% was four times the average for the eurozone, well ahead of France's 0.1% and a contraction in output in Italy and the Netherlands, which fell 0.1% and 1.4% respectively. On the day’s result, British FTSE has declined by 0.34%, CAC 40 (France) has decreased by 0.73%, DAX (Germany) has lowered by 0.29%.
Julys’ contractual price on Brent oil, decreased by $0.19 to $113.22 per barrel.
In Ukraine
Trades on the Ukrainian stock exchange opened by decrease, day passed with negative dynamics. Value of the UX index has declined by 1.05% to 1222.57. Share trades capacity on the application market was equal to UAH 13.2 million. Trades capacity on the derivatives market was equal to UAH 10.4 million. Total trades capacity for yesterday — UAH 44 million.
From ten shares of an index basket, eight have declined. Better than market looked were shares of Azovstal Iron and Steel Works (+0.13%) and (+0.%). Worse than market looked shares of Alchevsk Metallurgical Plant (-2.94%) and Avdiivka Coke Plant (-2.68%).
Gazprom switched Ukraine to advance payment for gas from 9:00 a. m. on June 16, and filed a suit at the Stockholm arbitration, demanding the return of USD 4.5 billion. Naftogaz also has filed a suit at the Arbitration Institute of the Stockholm Chamber of Commerce, demanding changes in price and refund of USD 6 billion overpayment.
Premarket
External background at the opening is neutral. Foreign direct investment into China fell 6.7% year-on-year to $8.6 billion in May. For the first five months of the year FDI – which excludes investment in financial sectors – was up 1.6% at $48.91 billion. The Asian indexes are showing mixed dynamics today. Nikkei rose by 0.29%, Hong Kong Hang Seng declining by 0.52%.
Futures on American indexes are growing today from 0.10% to 0.13%.
Russian indexes as of 10:03 a.m. are rising decreasing showing mixed dynamics — RTS increasing by 0.07%, MICEX growing by 0.45%.
Our expectations
We expect opening of the Ukrainian market on neutral territory.
In Europe will be published Consumer Price Index in the U.K. (11:30 AM) and ZEW Economic Sentiment for Germany and EU (12:00 AM)
In the U.S. will be published Building Permits (3:30 PM), Housing Starts (3:30 PM) and data on Consumer Price Index (3:30 PM).
ITT Investment group
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