Daily Market Reviews by MAYZUS.com

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27 January 2014: Meeting Of FED Will Start On Tuesday

DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.

On Friday, the trading session was exceptionally bad for the majority of the main stock markets of the world. The Dow Jones Industrial Average index showed the strongest fall since the 20th of June 2013, and lost 1.97%, reaching the level of 15879.11 points. The index lost 3.5% in a week, which became the worst week since November, 2011, with 4 days of decrease in a row. The S&P 500 decreased by 2.09%, reaching the level of 1790.29 points, and Nasdaq Composite lost 2.15% and finished the trading session on a level of 4128.17 points.

The situation in the European stock exchanges did not differ, indices significantly lost in value. Following the results of the session, the key index of Great Britain, FTSE 100, went down by 1.6%, the French CAC 40 lost 2.8%, and the German DAX went to a minus by 2.5%. The regional STXE 600 indicator, in turn, decreased by 2.4% and was closed on a level of 324.75 points.

Mainly, markets are showing negative dynamics due to fears concerning further prospects of the development of the economy in China, the sale of currencies of developing countries, and also expectations of a new stage of turning of the QE program by the FED. Extremely large sales of currencies of developing countries began after the publication by HSBC (preliminary data on the index of business activity in the industry of China), which testify delay of growth rates of the economy.

The situation in the Asian-Pacific Region this morning is following the American mood, Japanese Nikkei is losing around 2.51%, the Hong Kong Hang Seng is falling by more than 2%, and the Chinese Shanghai Composite is decreasing by 1.02%.

This week will be rather saturated with corporate events. Within the week, quarterly results will be presented by all main IT giants, including Apple. As has been mentioned many times before, the meeting of the FED, which will start tomorrow, is going to become a main event of the week in the markets. Naturally, further direction of the markets will depend on volumes of reduction of the QE3 program. There are not a lot of statistics expected to be published today. Data on the labour market, and sales of new houses is going to be published in the U.S, and the Index of business climate of IFO will be presented in Germany.

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28 January 2014: Today, All Attention Will Be Directed Towards The FED Meeting

DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.

On Monday, the stock market of the United States of America continued last weeks fall, and finished the trading day in the red zone. The reasons for pessimism in the markets more or less remain the same: fears concerning further prospects of development of the Chinese economy, and expectations of a new stage of turning of the QE3. The two day meeting of the FED begins today, and even by tomorrow participants of the market will be able to see the results.

Following the results of the trading session, the Dow Jones Industrial Average index weakened by 0.26% and was closed on a level of 15837.88 points, the index of the wide market S&P 500 went to a minus by 0.49% to the level of 1781.56 points, and the index of the hi-tech companies, Nasdaq, receded by 1.08% to the level of 4083.61 points.

As for the European markets, even good statistics from Germany could not push European indices to go up, and the European platforms closed the trading session with a decrease. The index of business climate of IFO in Germany made 110.6 points, at the forecast of 110 points; the index of the current conditions didn't change, and the index of economic expectations grew to 108.9 points. As a result, DAX decreased by 0.46%, FTSE 100 fell to 1.7%, and CAC 40 lost 0.41%.

This morning,Asian stock markets bargain in a small plus. Most likely, it is a correction after the long fall of the indices. Growth of the main indices is insignificant, within 0.1%, and markets are just flat. The Japanese Nikkei grows by 0.12%, the Korean KOSPI by 0.3%, the Shanghai Composite index adds 0.08% and the Hang Seng increases by 0.07%.The Australian index, on the contrary, shows decrease, led by falling of quotations of the largest mining companies of the world, BHP Billiton and Rio Tinto, due to fears of reduction of orders from China.

The prices of commodities are stable. Brent this morning adds 0.18% and is traded on a level of 106.68$ per barrel, WTI is up by 0.08% on a level of 95.8$ per barrel. Gold is losing 0.24% and bargaining on a level of 1260.37$ per troy ounce, silver is up by 0.09% on a level of 19.81$ per troy ounce.

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29 January 2014: Nervousness Is Increasing In The Markets

DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.

Yesterday, the main stock indices of the United States showed positive dynamics and finished the trading session with an increase for the first time in the few last sessions. Published statistical data on the index of consumer confidence for January raised from 77.5 points in December to 80.7 points, whereas analysts expected only 78.1 points.

Following the results of the session, the Dow Jones Industrial Average index increased by 0.57% and was closed on a level of 15928.56 points, the index of the wide market S&P 500 went to plus by 0.61% to the level of 1792.5 points, and the index of the hi-tech companies, Nasdaq, added 0.35% reaching the level of 4097.96 points.

The season of presentation of corporate quarterly results continues, and among other interesting facts, the largest pharmaceutical company in the USA, Pfizer, added 2.6%, after declaring that the profit made in the fourth quarter is 56 cents per share, which is better than market forecasts of 52 cents per share. In contrast, the trading session for the Apple Corporation was very unsuccessful, where quotations fell to 8% because iPhone sales did not reach forecast of the analysts, even by having reached a record level of 51 mln units.

European stock markets also had a chance to win back some losses obtained over the last few days. The London FTSE 100 index grew by 0.33%, the Parisian CAC 40 rose by 0.98%, and the Frankfurt DAX increased by 0.55%.

Oil quotations are moving in slightly different directions, having got support from cold weather in America, predicting an increase of demand for raw materials, but, at the same time, are restrained by expectations of growth of stocks of oil according to EIA, on 2.338 million barrels. This morning, Brent adds 0.09%, traded on the level of 107.50$ per barrel, and WTI is losing 0.14%, bargaining around 97.27$ per barrel.

In general, stock markets are going to feel some nervousness today, as the attention of participants of the markets is going to be directed to the results of the two day meeting of the FED. To remind you again, this meeting is the last for the current FED chairman - Ben Bernanke. The majority of the analysts are presuming that he is going to confirm his previous statements (that the American economy is recovering), which will be a supporting signal for the continuation of turning of volumes of the QE3 program.

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30 January 2014: FED Cuts QE3 Program By Another 10 Billion Dollars

DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.

Yesterday, FED announced the decision on the reduction of the repayment of assets, by 10 billion dollars, to $65 billion dollars a month. This meant that the regulator ignored the weak statistical data that was presented, stating that the growth of economic activity was accelerated in recent quarters; indicators of the labor market had mixed character, but in general showed further improvement. Additionally, the interest rate was kept in its target range of 0%-0,25%, which coincided with the forecast.

Following the results of the trading session, the Dow Jones Industrial Average went down by 1.19% to the level of 15738.79 points, the index of the wide market Standard & Poor's 500 decreased by 1.02% to a level of 1774.20 points, and Nasdaq Composite went to a minus by 1.14% and reached the level of 4051.43 points.

European stock markets also came to an end in the red zone. The index of the London stock exchange, FTSE 100, fell by 0.43%, the Parisian CAC 40 fell by 0.68% and DAX fell by 0.75%.

The Asian markets, following American indices, began the day in a minus. The MSCI Asia-Pacific index lost 1.8%. Markets of South Korea and Taiwan were closed. In addition to the disappointing news, final PMI index from HSBC across China made 49.5 points, when forecasts were 50.5 points. Nikkei 225 lost 2.45%, and Shanghai Composite, 0.82%.

The FED meeting is finally over, and now investors are going to go back to following the publications of macroeconomic statistical data. Today, the following data is going to be published on: unemployment and preliminary data on inflation in Germany; business climate, consumer confidence and consumer inflation expectation in the Eurozone; preliminary estimate of gross domestic product for the IV quarter, primary requests for unemployment benefits, and data on consumer inflation in the U.S.

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03 February 2014: January Appeared To Be Quite Inconsistent For The Markets

DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.

The American indices finished the last trading week in negative territory. Negative attitudes were brought to the market due to the fact that according to the presented data from the FED, the volume of the commercial debt papers of the American companies was reduced for the week to 1.014 trillion dollars. Besides that, pressure on the market increased due to the reporting period of large companies, whereby data appeared to be worse than forecasts. The American investment company KKR Financial Holdings, reported a decrease in quarterly profit from 77.01 million dollars to 61.99 million dollars. The Chevron oil company reported around a 32% falling of quarterly profit to 4.93 billion dollars.

As a result, indices closed the trading week with the Dow Jones industrial average index decreasing by 0.94% to the level of 15698.85 points, and over the week the loss was 1.1%. The Standard & Poor's 500 index decreased by 0.65% having closed at the level of 1782.59 points, loss over the week being 0.4%. The Nasdaq Composite index decreased 0.47% to a value of 4103.88 points, having lowered during the week by 0.6%.

The situation in the commodities market also became negative last week as both prices of oil and precious metals lost in value. This morning, Brent is bargaining next to the level of 105.55$ per barrel, losing 0.25%; WTI is down by 0.47% on the level of 96.24$ per barrel. Gold is up by 0.22% on a price of 1242.54$ per troy ounce and silver decreasing by 0.01%, traded on the level of 19.12$ per troy ounce.

Meanwhile, February will be saturated with events that will have an influence on the development in the markets. A large part of investors attention will be focused on the Congress of the US, who need to solve the issue of raising of the ceiling of the American national debt, before the end of the week. Investors will also take an interest in February's meetings of the European Central Bank and the Bank of England. Today, it is worth paying attention to indices of business activity in the industrial sector of Germany, the Eurozone and Great Britain, and the index of economic conditions of ISM in the production sphere in the USA.

Copyright: MAYZUS Investment Company Ltd

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04 February 2014: January Sales Continue On Stock Markets

DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.

On Monday, the main stock indices of Europe showed negative dynamics due to a heavy decrease in activity of the banking sector. From the macroeconomic statistics which were published yesterday, attention should be paid to indexes of business activity for January in the industries of Switzerland, Germany, Great Britain, and also as a whole the Eurozone. In the Eurozone, the indicator increased from 53.9 points to 54 points, in Switzerland from 55 points to 56.1 points, in Germany from 56.3 points to 56.5 points, and in Great Britain it decreased from 57.2 points to 56.7 points.

As a result, the index of Great Britain, the FTSE 100, went down by 0.7%, the French CAC 40 became 1.4% easier, and the German DAX went to a minus by 1.3%. The regional STXE 600 indicator decreased by 1.3% and was closed on a level of 318.21 points.

The situation in the American market also sharply weakened after the publication of an unexpectedly weak report on the industrial ISM index in the USA. In January, this indicator decreased from 56.5 points to 51.3 points, whilst analysts expected 56 points.

As a result, the Dow Jones Industrial Average index decreased by 2.08% to the level of 15372.8 points. The S&P 500 lost 2.28% reaching a level of 1741.89 points, and the Nasdaq Composite fell by 2.61% to the level of 3996.96 points.

Asian markets didn't have any other choice but to follow the negative European and American trading sessions. The MSCI Asia-Pacific index decreased by 2.3%, which is the strongest decrease in the past eight months. The Japanese Nikkei is losing 4.17% this morning , and Futsee-100 falls by 0.54%. Shanghai Composite also decreases by 0.82%.

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05 February 2014: The Situation In The Stock Markets Is Stabilizing

DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.

Yesterday, participants of the markets finally calmed down, which helped indices to recover slightly from the falls of the last few days. Optimism was brought by macroeconomic statistical data which pleased investors. According to the published data, orders in the manufacturing industry were reduced in December by 1.5%, while analysts expected the fall of the indicator to be 1.7%.

Investors attention was also directed towards speeches from the representatives of the FED. In particular, the head of the FED of Richmond, Jeffrey Leker, noted that the American economy will continue its development, with a very slow rate, however, this will not affect decisions of the FED to continue to reduce the program. Accordingly to his estimates, gross domestic product of the country will grow in 2014 by 2%, and the rate of inflation in the next 1-2 years will reach the target level of 2%. At the same time, the head of the FED of Chicago, Charles Evans, declared that an increase of interest rate could be possible, but only in the long-term, and monetary policy will remain to be soft until the FED is sure that all necessary measures have been taken for achievement of maximum employment and price stability.

Following the results of the session, the Dow Jones Industrial Average index rose by 0.47% and was closed on a level of 15445.24 points. The index of the wide market S&P 500 went to plus by 0.76% to the level of 1755.2 points, and the index of the hi-tech companies, Nasdaq, increased by 0.87%, to a level of 4031.52 points.

Asian stock markets are recovering after a strong fall yesterday. The Japanese Nikkei adds 1.23%, the Korean KOSPI also grows. China is still celebrating New Year in the country. The Australian ASX200 and the Indian BSE Sensex are decreasing.

Today is going to be a very saturated day, statistical data wise. Indexes of business activity in the Eurozone, data of ADP Services on the labor market in the USA, and the ISM index in the non-manufacturing sector are expected.

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07 February 2014: ECB Keeps Its Soft Stimulation Of The Economy

DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.

This morning, positive external background remains in the markets. Among the main factors pushing indices to move up, is the preservation of soft stimulating policy in the Eurozone and expectation of data on the level of Private Non-farm Payrolls and unemployment rate in the USA for December, which will be published in the second part of the day.

Yesterday, the European Central Bank declared preservation of the interest rate at the former level of 0.25%. At a traditional press conference, the president of ECB, Mario Dragi, confirmed that the bank will start to take measures only if forecasts on inflation will start to become worse, and turbulence of the currency market will increase. Inflation in the Eurozone was unexpectedly slowed down to 0.7% per annum following the results of December, which became its lowest value since 2009.

Published macroeconomic data in the U. S. yesterday was also rather positive, primary jobless claims made 331 thousand when what was expected was 335 thousands, decreasing by 20 thousand from last month. Non-farm Productivity made 3.2%, 2.5% was expected.

This helped American indices to close the trading session in a green zone. The Dow Jones industrial average index increased by 1.22% reaching the level of 15628.53, S&P 500 increased by 1.24% to the level of 1773.43 points, and Nasdaq Composite added 1.14% in value, finishing the trading session on a level of 4057.12 points.

Today, the attention of the investors is going to be directed towards employment change in the non-agriculture sector in January, which, with a high probability, will significantly affect both dynamics of the trading session in the USA, and closing of the European exchange markets. It is expected that growth of the number of workplaces in January made 185000, after growth of 74000 in December. Strong data could lead to a continuation of growth of profitability of state bonds. Weak numbers could raise doubts in expediency of turning of the QE program.

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10 February 2014: The Labor Market Of The USA Was The Main Source Of A Positive In The Markets

DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.

On Friday, investors concentrated their attention on the publication of macroeconomic statistical data. Statistics on the labor market of the USA were weaker than predictions of analysts. Frosts again became the main reason why the quantity of created workplaces appeared below market forecasts. This time, around 262 thousand people could not come to work because of cold weather, which coincided with the figure recorded in December.

The Non-farm payrolls indicator made 113 thousand whereas 185 thousand were expected. The average hourly salary increased by 0.2%, having coincided with market expectations, and the average duration of the working week remained invariable at a rate of 34.4 hours. Among the positive data, it should be noted that the unemployment rate decreased from 6.7% to 6.6%.

As a result, the index of the wide market S&P 500 increased by 1.33% and finished the week on the level of 1786.58 points, the indicator of blue chips, the Dow Jones Industrial Average, grew by 0.5% to the level of 15705.84 points, and the index of high-tech industries, Nasdaq Composite, added 1.69% reaching a value of 4105.38 points.

Oil managed to increase in price due to the retreat of the dollar, and the remaining positive dynamics of the decrease in the unemployment rate in the USA. Brent this morning is traded on a level of 108.46$ per barrel, increasing by 0.36% and WTI is losing 0.16% traded on a level of 99.19$ per barrel.

Today we expect a rather quiet trading session, as there are not many important economic reports expected during the day. One of the most important events this week is going to be the press-conference of the new head of the FED, Janet Yellen. Undoubtedly, she will be asked questions concerning the plans of the FED in relation to the target levels of the labor market. Besides that, the publication of the report on retails is another important event of the current week.

Copyright: MAYZUS Investment Company Ltd

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10 February 2014: Prices of Coffee rise due to unprecedented drought

DAILY MARKET REVIEWS
By Kristina Leonova: Analyst in Portfolio Asset Management Department.

Since the end of 2014, the price of coffee has increased more than 30%. The reason of the soar is severe drought in Brazil, which could reduce the future harvest by more than 10%.

Brazil is the main producer of Coffee worldwide. Brazilian Arabica, thanks to its low price, is a key ingredient in coffee mixture. Brazilian Arabica is one of the best coffees in the world.

Traders are concerned regarding the future of the Brazilian’s harvest of coffee, which is pushing the price up. The maximum price was recorded near to the level of 144 dollars per pound.

At the moment, we are observing a technical correction. The key support level is 132 dollars per pound. Coffee could continue its growth. The key resistance level is $144. If the level is breached up with success, then Coffee could reach the following levels: $152.00 and $163.00.

If the bears breach down the support level of $132, then Coffee will continue its technical correction. The next levels for decline are $128.40-$124.75.

This information is an analytical review of Capital and FX markets. The material presented, and the information contained, is investment research and should in no way be considered as the provision of investment advice for the purposes of Investment Firms Law 144(I)/2007 of the Republic of Cyprus, or any other form of personal advice, which relates to certain types of transactions, with certain types of financial instruments.

Copyright: MAYZUS Investment Company Ltd