Major U.S. stock indexes closed the trading session with a significant decrease. The reason for the fall of the entire market has been a sharp drop in shares of high-tech and biotech companies. Another negative factor was the reduction in imports and exports in China. Positive data on the labor market have not been able to change the mood of investors. Thus, the number of unemployment claims in the U.S. fell to 300 thousand, which is the lowest level since May 2007. Analysts had forecasted a decline to 314 thousand.
The price of euro continued to rise and reached the level of 1.39. The reason for the growth was the news from Greece, which for the first time in 4 years issued bonds and has got more than 3 billion euro at a rate of 4.95%. It is worth noting that the increase in quotations was also stimulated by data on inflation in France that fell to 0.4% in March, which is 0.2% less than the forecast. Currently we expect the correction due to overbought price and possible closing of positions before the weekend. The course of trading today can be influenced by data on consumer price inflation in Germany (06:00 GMT), the U.S. PPI (12:30 GMT) and the index of consumer confidence in the U.S. (13:55 GMT).
On Monday will be released a number of important macro on industrial production in the euro area, retail sales and business inventories in the United States. In addition, investors will follow the situation in Ukraine, where tensions are traditionally growing during weekends.
The price of the British pound is consolidating above 1.6750after a strong growth in the previous days. The growth of quotations has stopped on the background of statements by the Bank of England about saving monetary policy unchanged. The interest rate of the Bank of England for 5 years remains unchanged (0.5%) and will be increased only with an increase in employment level and low risks for economic growth. We maintain a long-term positive outlook, but we expect further correction in prices. The course of trading can be affected by data on the index of leading economic indicators, of the United Kingdom (09:00 GMT).
The price of USD/JPY continued to decline against the weakening of the U.S. dollar. Decline continued on the background of data on growth of the monetary base in March by 3.5%, which is 0.4% less than the analysts' forecasts. Moreover, in his speech the head of the Bank of Japan Kuroda said that there is no need for additional monetary easing, despite the possible economic slowdown caused by higher sales tax. We maintain a long-term positive outlook and expect renewed growth of quotations soon.
The Australian dollar started the correction due to negative data from China, which is the main trade partner of the country. Message about the fall of exports in China increases the risk for the Australian economy, which depends on the export of iron ore to China. We expect further correction of the Australian dollar.
The New Zealand dollar continued to decline amid falling Australian currency decrease in food price index in March by 0.3%, as well as slower growth in house prices in New Zealand in March to 2.1% against the previous figure of 3.4%. We expect the fall slowdown and maintain a positive medium-term outlook for the pair.
Rising prices for Light Sweet crude oil stopped on the background of negative data in China, which is the world's second largest oil consumer. According to reports, China's foreign trade turnover in March showed a reduction by 9% compared with last year. Prices were supported by the message of the OPEC on reduction of crude oil production in March to the lowest level since the beginning of the year. At the same time, the OPEC raised its forecast for the aggregate supply of oil by the countries of cartel. Negative impact on the price of oil can have a restoration of supplies from Libya. We maintain a long-term negative outlook for oil.
The price of gold continued to rise against the weakening U.S. dollar and falling stock markets. Sales of high-tech stocks have led to increased demand for defensive assets like gold. The growth of quotations of gold was restrained by positive data on the U.S. labor market. Outflow of funds that invest in gold, has stopped, and demand for physical gold in Asia is gradually increasing. We keep medium and long term positive outlook.