Market's evolution 15 of February to 19 of February 2016
Monday, 22 of February 2016
Getting closer to an agreement, the meeting between some members of OPEC made the price of Brent fluctuate down -1% because despite finding common ground, rises in the crude stocks with respect to last month, turned down the price of the commodity.
From Europe we were awaiting a meeting set by the representatives of the EU in order to prevent the departure from the UK, the subsequent statements and rumors and the statements made by the members, as well as the possibility for the ECB to carry out further monetary policy. Among others, the purchase of Italian "bad" debt under the program of QE with the objective of stabilizing the financial market.
In a context in which have been newly trimmed forecasts for global growth for 2016 to +3%, macroeconomic reference data for the Eurozone was better than expected showing improvements in the current account and the confidence index investment. Even so, in the statements made by Draghi on Monday, continued emphasizing the danger of the downward pressure on price levels.
We can find a similar situation in the US, where despite good macro data releases, concerns about a possible recession in the country is higher. The minutes of the Fed reflected as well concern by external destabilizing factors, the deterioration of inflation expectations and financial instability.
After a week with the markets closed, China started its new year with rises of 3% in the selective of reference and improvements in the trade balance. And despite the bad data exports, they would be justified by the change in their economic model being implemented, so that higher levels of investment and consumption in the future would be expected. By contrast, in Japan the poor figure of GDP and the drop of -17% in machinery orders heightened concerns regarding the future development of the country.
Among all financial markets, it was the equity market which starred the best performance. After the deep cuts suffered in past sessions, the world's leading selective recorded strong rebounds. In Europe, the most benefited was the French CAC40 index with rises of +5,75% followed by the German DAX which closed at levels of 9.388 (+ 4,70%). The US markets ended the week in positive territory as well; the Nasdaq Composite with rallies of +3,85% and the S&P500 scoring a +2,84% at 1.917 levels while maintaining their levels of support. We must highlight the rally of the Asian selective Nikkei225 which scored a rise of +6,80%.
Still maintaining the upward trend in the EUR/USD, the common currency failed to maintain the levels of 1,125 EUR/USD and ended the week around the 1,113 EUR/USD. We will be looking forward to further monetary policy in the US, which could favor the common currency. As for the yen, the pair stood at levels of 125,32 EUR/JPY after the recent strengthening of the Japanese currency.
The price of the ounce of gold took a breath maintaining levels above 1.200 USD/Oz. without significant changes. In contrast, we found higher levels of volatility in the price of the Brent following the numerous statements made by the energy ministers of the member countries of the OPEC. And despite having approached positions, uncertainty regarding carrying out reductions in the levels of production of the commodity, made the price of Brent go down by -1% ending the week trading at 33 USD/Brent.