Market's evolution 21 of December to 25 of December 2015
Monday, 28 of December 2015
Rallies in the price of the crude saved the weekly close after the poor acceptance of the results obtained in the Spanish general elections. After losing the majority, over the coming sessions Mariano Rajoy (president of the Popular Party from Spain), will have to seek allies with whom to form a consensus government agreements.
Although there has been no significant references to the euro zone throughout the week (except for the election days in Spain), we have heard the outlook for the Eurozone of some members of the ECB. Usually everyone agrees to maintain a positive view of the European economy, which is being benefitted from the reduced interest rates and reductions in oil prices. Also, the most worrying factors remained being the high levels of debt and the low price levels.
Mixed data published of the US economy. As we knew, the GDP data for the Q3 beat the consensus estimate of the analysts (at levels of +2%). Also, expectations and consumer confidence recorded significant progress. On the other side, there were slight declines in durable goods orders and home sales (factors that could indicate a slowdown in growth levels in the case that the downward trend continues).
In Asia, we have known that the Japanese government might be considering to carry out incentives that will boost the corporate investment. Furthermore, the publication of the minutes of the BOJ, the outlook for the Japanese economy would remain on the path of growth, and although the slowdown of the emerging economies, the Central Bank reiterated that the monetary policy would be adapted to the needs of the economy.
In the equity markets, despite the bad start of the week, rallies as a consequence of the drop in oil inventories, boosted the stock markets during the session of Wednesday’s session with strong gains recording levels of closures at 10.727 (+1,12%) for the German DAX. Without doubt, the most benefited in Europe was the FTSE100 given its high exposure to the energy sector recording an increase of +3,29%. In the US, the balance was positive as well, the S&P500 which pulled himself up to 2.060 levels (+2,73%), while the Nasdaq Composite did it up to the 5.048 (+2,52%). In contrast, in Japan, the benchmark index suffered cuts of -1,15%.
As for the currency, throughout the week the EUR was the main beneficiary after recovering some of the lost ground to the USD, trading around the 1,0973 EUR/USD.
In the commodities market, oil prices seem to have bottomed out after repeated cuts, trading around the 37,89 USD/Brent and scoring a +2,70%. Even so, the price has come to touch 35,89 USD/Brent throughout the week, and the largest brokerage houses have begun to warn of the hazard that unpaid debt of some North American companies of fracking, could fall into the inability to maintain profits, a factor that would eventually reduce the supply and push prices up to higher levels.