29.01.2016 - The Bank of Japan reduced interest rates

Futures on major US indices are growing today against the backdrop of rising oil prices, as well as the decision of the Bank of Japan to further stimulate the economy with the help of negative interest rates. It is worth noting that investors are waiting for the publication of preliminary data on US economic growth in Q4 (13:30 GMT). In case of weak data, the fall in the market is likely to resume. The dynamics of trading also insignificantly will affect the data on the Chicago manufacturing PMI (14:45 GMT) and the index of US consumer confidence for January (15:00 GMT). We expect a strong movement in the market today and in the coming months, the fall on the markets is likely to continue.

The main European stock indices are now showing a positive dynamics despite the weak corporate reports of a number of large companies. The reason for optimism is the improvement of the situation on the commodity markets and the Bank of Japan's decision to strengthen the incentives. Yesterday was published statistics according to which GDP growth in the UK in Q4 was 0.5% versus 0.4% previously. Today it became known that GDP growth in France according to preliminary data, in the 4th quarter was 0.2%, and in Spain 0.8%. Support for the market were the news about the growth of the consumer price index in the euro area by 0.4% in January compared with the same period last year. Further movement on the markets will depend on the data on the growth of US GDP (13:30 GMT). We maintain a positive medium-term outlook for the European market and now expect increased volatility.

Markets in the Asia-Pacific region are growing today against the decision of the Bank of Japan on the introduction of negative interest rates. For lowering of interest rates by 0.20% to -0.10% voted 5 of 9 representatives of the Bank of Japan. Forecast of reaching the inflation target has been moved to the first half of 2017. On the other hand, growth was limited by weak data on industrial production in Japan, whose volume in December fell by 1.4%, which is 1.1% worse than expected. On Monday, markets in the region will assess the current statistics on US GDP. Special attention should also be payed to Monday statistics on manufacturing PMI in China, Japan and Australia. We expect an increased level of volatility in the Asia-Pacific markets in the near future and the growth of the Japanese market.

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