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Forex · News · Forex ForecastsNEWS / Forex Forecasts |
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US market…Oil prices pressed stock exchange market.
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08:08 08/05/2004
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US market…Oil prices pressed stock exchange market.
Unexpectedly strong data on ISM services index in the U.S. in July pushed major American stock exchange indexes to decline. Let us remind that the mentioned index came out 64.8, whereas forecasted 63,0 and the previous value of the index equaled 59.9.
It is a common fact that positive data, contributing to FRS interest rate hike that might occur at the FRS meeting on August 10, put the pressure on stock exchange indexes and vice versa.
Factory orders in the U.S. in June also turned out to be positive, coming out +0,7%, as expected. Previous value of the index was revised from –0,3% to +0,4%. It is quite an important factor for the market that the previous value of the index was revised aside increase. Besides, durable goods orders were revised from +0,7% to +0,9% in the U.S. in June.
However, if we take a close look, we see that such component of ISM services index, as employment index, dropped from 57.4 to 50.0. And that is quite an unpleasant factor for the investors prior to Friday Labor market review that is to be released in the U.S.
Probably, that is exactly why the indexes failed to pass the peak of Monday trading session’s end and outlined downward correction.
Indexes are under a heavy pressure of oil prices that hit new record. Let us remind that crude rate rose to $44.34 a barrel, maximum since 1983, in New York.
We are expecting three important events this week.
In London, regular two-day meeting of the Monetary Policy Committee of the Bank of England is to finish on Thursday. The results of the meeting will e announced at 11:00 GMT, August 5. The majority of economists forecast that Repo rate will be raised 0,25% to 4,75%. This is expected to be the last hike this year.
The results of the meeting of the Board of Governors of ECB will be released at 11:45 GMT. Interest rates are likely to remain unchanged in Europe (12).
Jobless claims in the U.S. in the week ended July 31 are to be made public at 12:30 GMT. The forecast here is 340 000, previous value equaled 345 000.
Recommendations: we recommend waiting for the results of the higher-indicated events for analyzing market situation. Stay out of the market so far.
Recommendations: we recommend waiting for the results of the higher-indicated events for analyzing market situation. Stay out of the market so far.
The forecast was created by trans1.
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