Anchor resume from 2 to 9 of February 2018
Friday, 09 of February 2018
This week focus
English Central Bank,
We ended a week in which volatility became the protagonist again. The fall of the main stock markets after several months of continuous valuations have led the VIX index to rebound to levels not seen since 2015. The stock declines accelerated as the volatility index shot up due to strategies leveraged in VIX whose investment hypothesis is that the volatility of the markets remained low.
The generalized setbacks do not respond to the fundamental data of the economy. Thus, without changes in the macro panorama, and in an environment of solid growth, the S & P500 retreated about 6.5% throughout the week, as did Dow Jones.
Following the behavior of the United States, in Europe the stock markets fell between 4% and 5%. So far this year, the indices with the lowest performance have been the FTSE100 (-6.7% YTD), followed by the DAX (-5.1% YTD), while the EUR / USD has reversed its trend and has been around 1.22EUR / USD.
On the other hand, the corrections in the Asian markets have been extended to -9.4% in the case of the Hang Seng and -8.13% for the Nikkei225. While in the emerging countries, the falls have been contained and the MSCI EM index remains positive so far this year. (+ 0.4%).
Against the previous scenario, and without changes in current economic expectations; The main driver of the markets for the coming months will continue to be inflation expectations and monetary policy announcements by central banks. While the economic releases of recent days continue to show strength, the composite PMI of the euro zone, amounted to 58.8 exceeding forecasts, in the same sense Germany published the manufacturing PMI that continues in an expansive zone. While retail sales in the Euro Zone in December presented a contraction of -1.1% in line with the estimates.
In the United Kingdom, we learned about the inflation report in the framework of the last meeting of the Bank of England, in which it emphasizes that in the short term the price index will be maintained at levels of 3% due to the strong depreciation of the pound and the upward pressure on oil prices; In this regard, the monetary policy decision of the central bank was to keep the rates unchanged at 0.5%, although the rate forecasts show an increase in 2018 and two more for 2019. Consequently, a first reaction of the currency was bullish however at the end of the week the EUR / GBP was around 0.88%. We also have the publication of the trade balance of the United Kingdom, which showed a deficit of 13,576 million pounds (expected -11,500 million), behavior that was attributed to the increase in oil prices and the increase in imports.
At the political level, Germany has reached a governance agreement; To be effective, it is necessary that the social democratic party endorse it in a congress. Among the main concessions accepted by the conservative bloc is the management of some ministries such as the Ministry of Foreign Affairs, Finance and Labor by the SPD.
In the commodity market, the price of oil ended the week at around 64.8 Uds / barrel, while gold stood at levels of 1.318.