11.01.2016 - The Chinese market continued to fall

US stocks fell during the last trading day of the week amid growing fears of investors due to the unstable situation on the Chinese stock market. It should be noted that the report on the labor market has shown strong growth in the number of jobs outside the agricultural sector of the United States, which totaled 292 thousand vs. expected 203 thousand. The unemployment rate was 5.0%. Investors were disappointed by the lack of wage growth. Today, on the market is possible a correction after a strong decline in the previous week. Today, the market activity will be relatively low. We expect a correction, but the decline may continue in the coming months.

European stocks continued to fall against the background of unstable situation in China. We expect the situation will stabilize soon and we will see a strong price correction. In addition, it is worth noting that the expected weakening of the euro and the program of quantitative easing will support growth on the markets of the region. Today, investors were disappointed by the statistics on the index of investor confidence, which in January fell to 9.6 vs. 15.7 previously. Tomorrow we should pay attention to data on industrial production in the UK. Our medium-term outlook remains positive, despite the possible continuation of the negative dynamics in the near future.

Markets in the Asia-Pacific region continue to fall after a minor correction at the end of last week. Weak macroeconomic data and lower yuan continues to support the fears of investors about the Chinese stock market. The Japanese stock market is closed today due to the holiday. Tomorrow will be published important statistics on the trade balance of China, the balance of payments of Japan and consumer confidence index in Japan. We expect a further decline on the stock markets in the region, but do not rule out a correction after a strong fall.

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