Last closure
On Thursday, September 4, trades in USA have come to the end with decrease, as energy producers sank with oil prices to overshadow new stimulus from the European Central Bank. Energy shares sank 1.3% for the biggest drop among the 10 main S&P 500 groups, as crude fell 1.1% in New York. Chevron Corp. and Exxon Mobil Corp. each lost 0.8% to pace declines in the Dow Jones Industrial Average. The ECB cut interest rates and will start buying assets, boosting the flow of funding for the euro-area economy while stopping short of broad-based quantitative easing. The move boosted European stocks and sent two-year note yields below zero in eight countries. Number of individuals filing for initial jobless benefits in the week ending August 30 increased by 4,000 to a seasonally adjusted 302,000 from the previous week’s total of 298,000. Analysts had expected jobless claims to rise by 2,000 to 300,000 last week. The US trade deficit shrank for the third straight month in July helped by gains in exports especially from the automotive sector. The monthly trade balance came in at a negative $40.5 billion, down from a $40.8 billion deficit in June. Exports rose $1.8 billion to $198.0 billion, while imports gained $1.6 billion to $238.6 billion. The ISM non-manufacturing purchasing managers index rose to 59.6 in August from the prior month’s 58.7. A reading above 50 indicates expansion in the service sector. Analysts had forecast the August PMI to drop to 57.5. On the day’s result, index Dow Jones has declined by 0.05%, S&P has lowered by 0.15%, Nasdaq has decreased by 0.22%.
European stock exchanges closed with growth of main indexes. The European Central Bank’s surprise decision to cut interest rates as well as start buying securitized debt brought investors out from the sidelines, sending the region’s benchmark index to a two-month high. In the U.K., the Bank of England maintained its benchmark rate at 0.5%, the level it held since March 2009, as predicted. The August Eurozone Retail PMI came in at 45.8 compared to the prior month’s reading of 47.6. It was the lowest reading in 15-months and missed market expectations calling for 47.6. Factory orders in Germany rebounded sharply in July following two monthly falls. Orders were up 4.6% from the previous month, far better than 1.5% increase widely anticipated in the markets. The increase follows an upwardly adjusted decline of 2.7% in June and a 1.7% fall in May. On the day’s result, British FTSE rose by 0.06%, CAC 40 (France) grew by 1.65%, DAX (Germany) has increased by 1.02%.
Octobers’ contractual price on Brent oil, decreased by $0.94 to $101.83 per barrel.
In Ukraine
Trades on the Ukrainian stock exchange opened by growth, day passed dynamics. Value of the UX index has declined by 0.18% to 1177.83. Share trades capacity on the application market was equal to UAH 12.6 million. Trades capacity on the derivatives market was equal to UAH 10.1 million. Total trades capacity for yesterday — UAH 53.9 million.
From ten shares of an index basket, six retreated. Leaders of growth were shares of Raiffeisen Bank Aval (+2.28%). Worse than market looked shares of Ukrnafta (-3.78%) and Avdiivka Coke Plant (-2%).
Ukrnafta cancelled a general shareholder meeting scheduled for 11 September. The company said the reason for cancellation was some technical issues. Also Ukrnafta announced a plan to hold a general shareholders meeting on 10 October 2014. Ukraine received on September 4 a second tranche from the IMF under the stand-by Arrangement in the amount of SDR 914.7 million (about $1.39 billion).
Premarket
External background at the opening is negative. German industrial output grew more than forecast in July, signaling that Europe’s largest economy is headed for a third-quarter rebound. Production, adjusted for seasonal swings, rose 1.9% from June, when it expanded a revised 0.4%. The Asian indexes are decreasing today. Nikkei has lowered by 0.05%, Hong Kong Hang Seng declining by 0.21%.
Futures on American indexes are slightly changing today from -0.01% to +0.03%.
Russian indexes as of 10:00 AM are decreasing — MICEX decreasing by 0.29%, RTS lowers by 0.14%.
Our expectations
We expect opening of the Ukrainian market on neutral territory.
In Europe will be published GDP in the E.U. (12:00 AM).
In the U.S. will be published nonfarm payrolls (3:30 PM) and unemployment rate (3:30 PM).
ITT Investment group
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