Weekly Market Review —– March 7-11 2016
Canada, New Zeeland and Eurozone interest rate decisions will be the main events this week
At the end of the week all the major currency closed above the zero mark. The greatest growth against the US dollar showed the Australian dollar (+ 4.31%). Also growth showed the New Zealand dollar (+ 2.81%), British pound (+ 2.57%), Canadian dollar (+ 1.51%), euro (+ 0.70%), Swiss franc (+ 0.35%) and Japanese yen (+ 0.17%). All major currencies showed an increase against the US dollar. This was due to the publication of negative statistics on the US economy. No doubt, the key event of last week was NFP report. US economy is showing strong growth to create new jobs. Nevertheless, the prospects for further rate hikes were marred by low growth in wages. This week the main events will be the announcement of decisions on interest rates of the central banks of Canada, New Zealand and the European Union.
Major US stock indexes spent the past week, trading mainly in the green zone. The only day when there was a drop in the stock markets, it was Monday. This was due to concerns about the Chinese economy, as well as dissatisfaction with the decision of the G20 meeting. However, the weak statistics spawned rumors of the leading countries that central banks will no longer boost growth. At the end of the trading week: Dow + 2,20%, S & P + 2,67%, NASDAQ + 2,76%.
The dynamics of European stock markets was very similar to the dynamics of their American counterparts. On Monday, stock markets in Europe showed the worst dynamics. Lately almost all loses were recovered and trades moved in the green zone, which lasted until the end of week. The possibility of expanding stimulus measures by central banks were in focus last week. This week there will be ECB meeting which is scheduled for March 10. The market expects the extension of incentives in the form of increased quantitative easing program.
Light Sweet Crude Oil Futures, Daily
Quotations of “black gold” rose significantly last week, rising above the level of $35 per barrel. This trend was due to the expectation of the fall in US production volumes, despite the publication of reports on stocks, according to which they have grown more than forecasts of experts. Some support provided scheduled for March 20 meeting of OPEC member countries and other major oil-producing countries, in which they may have agreed to reduce production volumes that will support the oil market. Yet, the oil market prospects are very negative, and the latter should be regarded as a growth correction.