03.11.2014 - US indexes have reached historic highs

The US stock market has grown in the last trading session of October on the background of positive data on manufacturing PMI of Chicago, which unexpectedly rose to 66.2, against the expected value of 60.2. At the same time, the consumer confidence index increased by 0.5 to 86.9. Personal consumer spending in September fell by 0.2%, but revenue continued to grow and increased by 0.2%. This week, the central event will be the publication of data on the labor market in the US in October, which traditionally strongly influences the mood of investors. Today we should pay attention to the statistics on the manufacturing PMI and construction spending. Our medium term negative outlook remains unchanged despite the fact that the indexes have reached historical highs.

USSPX Forcast

European stocks rose on positive news from Japan, where decided to expand the program to stimulate the economy. In addition, investors reacted positively to the statistics on the growth of the consumer price index by 0.4%, which is 0.1% better than the index in September. It is worth noting that consumer prices rose despite the decline in energy prices by 1.8%. Eurozone manufacturing PMI fell 0.1 to 50.6, while the same indicator in the UK will be published at 09:30 GMT. We maintain medium term negative outlook for European stock markets.

Markets in the Asia-Pacific region have not changed much today. In Japan, the trade was conducted in connection with the holiday. Chinese investors were disappointed by the lack of growth the manufacturing PMI, which remained at 50.4. Similar indicator in Australia increased to 49.4 against 46.5 in October in September, but remains outside and below 50.0, which indicates a reduction in the sector. Tomorrow we expect a strong movement in the Australian market in connection with the publication of data on the trade balance, retail sales, as well as the publication of the statement of the Reserve Bank of Australia. Easing of monetary policy in Japan will support the market in the country, but in general, our medium term outlook for indexes in the region remains negative.

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