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Forex · News · USMarket

NEWS / USMarket

USmarket Key stock indexes are still under pressure within the limits of correction

11:47 03/06/2006

On a background of unexpectedly positive data of the US Institute for Supply Management which calculates the index on the basis of survey of managers of 370 companies from 62 service sectors, having supported expectations of continuation of the US FRS monetary policy firming, shares on Wall Street opened with decrease.

 

Let's remind that unlike industrial sphere, which is supported by investments of the companies, indicators of activity in service sphere improve in case of growth of consumer expenses that is an important point for the US FRS in decisions on change of a level of interest rates.

So the business index in service sector rose up to 60.1 points in February, 2006 from 56.8 in January, allowed players to gamble on increase of a rate of the American currency.

Let's also remind that analysts forecast that value of the index would make 58.0 points in February.

And the employment index in February made 58.2 points against 51.1 points in January, and the price index made 64.8 points, having remained at a level 67.2 points. Thus the new orders index in service sphere made 56.2 points against 56.0 points.

More than 85 % of the US gross domestic product falls to the share of service sphere And value of the indicator above 50 points means rise of sector, and below - downturn.

 

However another indicator – a final value of University of Michigan Consumer Sentiment Index, having been a little below forecasts, could not affect essentially a situation in the market. We shall remind that a value of the indicator was equal to 86.7, at the forecast 87.4 and the previous value 87.4.

Thus the component of the index, reflecting current conditions, decreased to 105.6 points in February from 110.3 points in January. And the component of expectations dipped to 74.5 points from 78.9 points in January.

Let's notice that the index is calculated monthly by results of survey of about 500 families, and is one of basic indicators for the US FRS.

 

Thus the situation in energy market has not yet found appreciable reaction in the share market. We shall remind that oil prices changed a little on morning tenders on Monday after growth last week.

At the moment April futures for oil WTI trade in area of $63.50 for barrel that is down $63.92 tops, achieved last week. For the last 2 weeks oil rose in price on 6 % that is connected with the next aggravation of geopolitical situation.

Investors continue to watch a situation around Iran and Nigeria. According to OPEC sources the cartel will keep a present level of production at the nearest meeting in Vienna on March, 8th.

 

"We have all the same - weakness because of geopolitics, but on the other hand, continuation of stocks growth in the USA is observed", - Tony Nanen at Mitsubishi Corp.says.

As a result Dow-Jones index of New York stock exchange was up 29.71 points and is at a level 11055.22. NASDAQ index was down 4.40 points and is at a level 2306.71. S&P 500 index was up 1.07 points and is at a level 1290.21.

And US 30-years state bond yield was up 0.044 in comparison with the previous closing and makes 4.660.

 

We recommend keeping purchases of Dow-Jones index futures opened from a level 10690. Thus the purposes of growth of the index hold good.

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