Last closure
On Wednesday, October 1, trades in USA have come to the end with decrease, as the Federal Reserve held its course to end bond-buying this month amid growing signs of economic weakness in Europe. The Fed is set to end later this month asset purchases that have helped nearly triple the S&P 500 during the bull market at a time when conflict between Ukraine and Russia threatens to tip Europe back into a recession and economists forecast growth from Japan to China will slow every year through 2016. More than $200 billion in assets was erased from U.S. equity markets during the past three months, as stronger economic data fueled concern the Fed may also raise interest rates sooner than anticipated. ADP employment change surprises to the upside in September. The private sector labour market continues to perform well in the US. According to the payroll-processing company ADP employment rose by 213,000 in September up from a revised 202,000 in August. Consensus had looked for an increase of 205,000. Manufacturing activity in the U.S. expanded at the slowest rate in three months in September. The Institute for Supply Management said its index of purchasing managers fell to 56.6 last month from a reading of 59.0 in August. Analysts had expected the manufacturing PMI to decline to 58.5 in September. The New Orders Index registered 60, a decrease of 6.7 points from the 66.7 reading in August, indicating growth in new orders for the 16th consecutive month. On the day’s result, index Dow Jones has declined by 1.40%, S&P has lowered by 1.32%, Nasdaq has decreased by 1.59%.
European stock exchanges closed with decrease of main indexes. Euro-area factories reduced prices by the most in more than a year and German manufacturing shrank, underlining the mounting challenge facing policy makers before the central bank meets. The German manufacturing PMI dropped to 49.9 in September from 51.40 in August. Anything below 50 signals contraction. This is the first sub-50 score since the middle of 2013, when the eurozone was still in recession. A person familiar with German government policy said Russia risks an escalation of sanctions. Hong Kong’s pro-democracy protests swelled for a sixth day. The Italian government said the country’s gross domestic product will shrink 0.3% this year, compared with its April prediction of an increase of 0.8%. It also forecast a slower-than-expected recovery in 2015, with GDP expanding 0.6% compared with a previous estimate of 1.3%. In France, the government will delay a goal to reduce its budget deficit to 3% of GDP until 2017 because of low growth and low inflation. On the day’s result, British FTSE has declined by 0.98%, CAC 40 (France) has decreased by 1.15%, DAX (Germany) has lowered by 0.97%.
Novembers’ contractual price on Brent oil, decreased by $0.51 to $94.16 per barrel.
In Ukraine
Trades on the Ukrainian stock exchange opened by decrease, day passed with positive dynamics. Value of the UX index has increased by 1.90% to 1097.62. Share trades capacity on the application market was equal to UAH 5.7 million. Trades capacity on the derivatives market was equal to UAH 7.9 million. Total trades capacity for yesterday — UAH 31.8 million.
All ten shares of an index basket have risen. Leaders of growth were shares of Azovstal Iron and Steel Works (+5.34%) and Alchevsk Metallurgical Plant (+4.82%).
Ukrainian and European Commission delegations are planning to hold a bilateral meeting on gas issues in Brussels on October 2, and a trilateral meeting could be held on Friday, October 3, Ukrainian Energy and Coal Industry Minister Yuriy Prodan has said.
Premarket
External background at the opening is moderately negative.
The Asian indexes are decreasing today. Nikkei has lowered by 2.61%, Hong Kong Hang Seng declining by 1.28%.
Futures on American indexes are slightly growing today from 0.05% to 0.11%.
Russian indexes as of 10:00 AM are decreasing — MICEX decreasing by 0.25%, RTS lowers by 0.04%.
Our expectations
We expect opening of the Ukrainian market by decrease.
In Europe will be published Construction PMI in the U.K. (11:30 AM) and interest rate decision by ECB (2:45 PM).
In the U.S. will be published initial jobless claims (3:30 PM) and data on factory orders (5:00 PM).
ITT Investment group
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