Market's evolution 23 of November to 27 of November 2015

Market's evolution 23 of November to 27 of November 2015

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The publication of important macroeconomic data conditioned last week since this could directly affect to the monetary policy taken by the ECB and the FED about interest rates and Quantitative Easing next month. Furthermore, geopolitical tensions focused the attention of investors after the demolition of a Russian airplane by the Turkish army.

Despite the above incident, the weekly balance in Europe was positive after the good macro data releases for the area, which aimed at an acceleration of the economic growth and job creation. Despite this, the ECB could consider setting charges on those banks that set aside cash in order to increase the liquidity available in the market. In addition, as mentioned, the Vice President of the ECB could implement new QE measures to boost price levels and lessen the economic impact that recent attacks could have in the economy.

In England, they were also concerned about the risks of inflation and low growth for the economy because of the negative effects they might have on the pound.

In the US, due to the celebration of Thanksgiving, the American stock markets were closed on Thursday and the half of Friday. As for the weekly balance, published data was mixed, among which it’s important to highlight a fall in the manufacturing index and further advances in reduction of unemployment benefit requests.

Althought the week started with the improvement of the consumer sentiment in China and maintaining the country’s rating to A+ with the stable outlook, a sharp drop on industrial profits in the country for October of -4,5% with respect to the -0,1% forecasted drop, led investors to close their positions. However, as far as Japan is concerned, it is noteworthy that in the publication of the minutes of the BOJ left opened the possibility that further expansionary measures could be carried out.

In this context, the USD continued rising its value against the EUR after the growing expectations of further easing measures in the Eurozone and the US rate hike next month. The pair finished the week at levels of 1,0590 EUR/USD (-0,50%) even closer to the parity levels.

An important resistance of the German selective was broken and the rest of stock markets in Europe experienced generalized rises. In contrast, the quote of Abengoa has suffered sharp drops after formally announcing that it had started talks with creditors on insolvency proceedings, raising the prospect of a messy restructuring ahead. This has prompted rating agencies to cut its credit rating to triple C and to be executed from the IBEX35. This new had a negative impact on banks due to their high credit exposure with the company. 

The weekly balance in major markets, was positive although not witnessed strong gains. Including rallies of +1,55% in the German DAX (closing at levels of 11.293) and of +1,55% in the EUROSTOXX50. Flat closures in the U.S at levels of 2.090 in the S&P500 (+0,04%) an at levels of the 5.127 in the Nasdaq Composite (+0,44%). Similarly in Asia, the selectives closed at levels of 19.883 (+0,02%) in the Nikkei225.

As for commodities, oil prices staged new rallies at the beginning of the week after the growing political risk and the statement made by Arabia Saudi announcing its intention of collaborating with the OPEC producers in order to stabilize oil prices. Despite this, the weekly balance was flat after the cuts suffered at the end of the week, trading around the 44,63 USD/Brent (+0,45%). Further declines widespread in the rest of commodities, including precious metals.