23.04.2014 - ​Oil prices fell amid contract’s expiration

Major U.S. indexes finished trading session, with the sixth consecutive increase. The reason for optimism has become positive macro statistics and corporate reports. Thus, earnings reports of Netflix (NFLX) and Harley-Davidson (HOG) exceeded analysts' expectations. Home price index rose in February by 0.6%, which is 0.2% more than in January. New home sales dropped to 4.59 million, compared with an expected fall to 4.57 million. At the same time, Richmond manufacturing index in April rose to 7, against the previous figure of -7. U.S. indexes continue to approach historic highs, but for further growth the market will require new incentives. We maintain a long-term negative outlook for the U.S. stock market.

The price of euro continues to consolidate near a strong level of 1.3810. Despite the weak data on consumer confidence in the euro area which has made -9, which coincided with forecasts of experts, the price of euro continues to hold at high levels. Today, the course of trading may be affected by data on the index of business activity in the service sector and the manufacturing sector of the Eurozone (8:30 GMT), flash manufacturing PMI in the U.S. (13:45 GMT), as well as data on new home sales in the U.S. (14:00 GMT). We maintain a long-term negative outlook for the euro.

The price of the British pound continued to trade in a corridor 1,6770-1,6840 due to the absence of important macro in the country. For further growth, the price needs new incentives. Today is expected to be published the letter the Bank of England on inflation, as well as voting of Monetary Policy Committee of the Bank of England on interest rates and the asset purchasing program (8:30 GMT), which according to our forecast will remain unchanged. In addition, the course of trading may be affected by data on public sector net borrowings (8:30 GMT), and industrial orders expectations in the UK. Considering the strong economic performance of Great Britain, we expect further strengthening of the pound in the long term.

The price of USD/JPY continues to consolidate below the strong level of 102.70. The price movement today will depend on data on the U.S. housing market. Increase in volatility is expected on Friday after the release of data on consumer price inflation in Japan. We recall that the target level for the Bank of Japan is 2.0%. Rising inflation will lead to growth of quotes. We keep medium and long term positive outlook and expect continued growth on this week.

The quotes of the Australian dollar dropped sharply after the release of quarterly data on consumer price inflation in Australia. Thus, in the 1st quarter of 2014, the CPI rose by 0.6%, against an expected growth of 0.8%. Investors appreciated this event as a stimulus to reduce interest rates by the Reserve Bank of Australia. We expect slower price drop in the near future, but keep medium-term negative outlook for the Australian dollar.

The price of the New Zealand dollar continues to consolidate above 0.8590. An increase in price stopped due to the fall of the Australian currency. Data on business activity in China in April turned out 0.1 worse than forecast and totaled 48.3, against 48.0 in March. Increase in volatility is expected today at 21:00 GMT after the statement of the Reserve Bank of New Zealand on monetary policy. We expect further ascending price movement in the medium term.

The price of Light Sweet crude oil dropped sharply due to the expiration of futures contracts and the publication of the forecast on the growth of oil inventories by 3.1 million barrels. Today, the focus of traders will be on the data on oil and petroleum products inventories in the U.S., which will be released at 14:30 GMT. The tense situation in Ukraine and disruptions in oil supplies from Libya are already factored in prices. In the next month, will be continued the work on the settlement of the nuclear program in Iran, which could allow to increase the volume of oil supplies to the world market. We maintain a long-term negative outlook for oil.

The price of gold continues to trade near 1280 dollars per troy ounce. The reason for the drop was the decrease of gold reserves in investment funds to the levels of the beginning of the year. Demand for the metal in Asia remains weak and approaching of U.S. indexes to historic highs reduces the demand for defensive assets. In case of correction in May, the demand for gold will increase. We expect the resumption of purchases in the near future and keep a long-term positive outlook for gold.

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