American stock indexes showed decline amid falling oil prices. It is worth noting that the recent trend will continue, despite the publication of positive news on the growth of retail sales in the US by 1.3% in April against an expected decline of 0.3%. This fact reinforces the likelihood of more early increase in interest rates of the Fed. Today, the dynamics of trading can affect the news on the manufacturing PMI of New York (12:30 GMT). The strong rise in volatility is possible tomorrow, after the publication of the consumer price index in the US, which has a key influence on the decision by the Fed to tighten monetary policy. We forecast a drop in the US stock market in the coming weeks.
Stock markets in Germany and France are closed today due to the holiday. The British market shows a decline on a background of a general deterioration in investor sentiment. The possibility of the UK’s exit from the EU after the referendum on June 23 will have a negative impact on the dynamics of the British market in the coming weeks. Tomorrow we should pay attention to the Eurozone’s trade balance and inflation data in the UK. We maintain our medium-term positive outlook for European markets, but in the coming weeks, there is a high probability of decline.
Markets in the Asia-Pacific region showed a positive trend despite the publication of weak statistics from China. Thus, the industrial production of the second world's largest economy grew by 6.0% in April compared with the same period last year. In March, the same indicator has made 6.8%. The volume of investments in fixed assets in China grew by 10.5%, which is 0.5% less than the forecast. The dynamics of trading in Japan is heavily dependent on the movement of the national currency of the country. Tomorrow we should pay attention to the data on the volume of industrial production in Japan and the publication of the previous RBA meeting minutes which lowered the interest rate by 0.25%. We forecast a drop in the near future, but the medium-term outlook for the region's markets remains positive.