19.09.2016 - Traders expect increased volatility
American stock indexes on Friday showed a decline due to the negative dynamics of the shares of Oracle and Deutsche Bank, which put pressure on the technology and banking sectors. It is worth noting that in the US consumer inflation accelerated in August to 1.1% compared with 0.8% in July. It should be noted that this fact increases the likelihood of the Fed raising interest rates this year, which will negatively effect the stock markets in the US and in the world. Tomorrow we should pay attention to the data on the housing market in the country, as the central event of this month will be the Fed's statement on monetary policy, which will be published on Wednesday. Our medium-term outlook on the country's stock market remains negative.
European stocks today show a positive dynamics after the decline on Friday, which was caused by the statistics from the USA and the news about the need to pay 14 billion dollars by Deutsche Bank to settle the dispute on loans secured by real estate. Today, among the leaders of growth was the commodities sector, after the Venezuelan president said about the likelihood of reaching the consensus on freezing oil production in the country. Negative for the market today have become unexpectedly weak data on the euro area balance of payments surplus which in July totaled 21.0 billion euros vs. expected 27.2 billion euros. Our medium-term outlook for the region's markets remains negative and we expect strong price movement after the Fed statement on Wednesday.
Markets in the Asia-Pacific region showed an increase due to the improved situation on the commodity markets. In Japan today, the trading session is closed due to the holiday. Tomorrow in Australia will be published the minutes of the previous meeting of the Reserve Bank of Australia. Investors will behave cautiously before the statement the Bank of Japan on monetary policy. In case of stimulus measures in Japan, we will see growth on the markets of the region, but its potential will be constrained by the expectation of the Fed statement on monetary policy. We expect strong movements this week and maintain the medium-term negative outlook.