European Central Bank (ECB) kept Eurozone’s interest rates at the same levels, but reiterated its readiness to react in the near future and called for national economies within the bloc to step up their efforts to assist growth.
The Stock sell off is dominating the markets as US stocks tumbled the most since the Brexit vote. This may be a warning sign of more volatility ahead as markets are catching up along with the opportunity for a September rate hike and geopolitical tension in Asia due to north Korea’s powerful nuclear test. Adding to the uncertainty is likewise Presidential Candidate’s Hilary Clinton’s health problems. Focus this week will be the US retail Sales (Thursday) and the BoE Rate Decision and meeting (Thursday).
Currencies: The price action during the Asian session was subdued, despite a stock market selloff. Last week, the USD rebounded from 2 week lows on Friday, as comments by FED members boosted the chances for an interest rate hike in the near term. The USD endured huge losses earlier when ISM service report indicated the biggest drop in the services sector since 2008. Investors are currently pricing a 24% opportunity of a rate hike in September and data leading to this announcement will be critically watched.
As the cliché goes, “Money makes the world go ‘round” and this has actually been particularly evident in the stock market world. While some were able to use the fame and fortune for good, others were simply lured by the glitz and glamor to feed their greed. Here are some of the heroes and villains in the stock world.
Charlotte Day, Head of Content and Social Media, easyMarkets
A recent article published by Bloomberg showed that Pokemon Go, a mobile app that recently swept the globe and led to a massive spike in Nintendo’s stock, was already in decline. In the financial markets, one-hit wonders like Pokemon Go are relatively common. In the following article, we look at modern stocks and take a trip down memory lane, recollecting some of the one-hit wonders of the world of finance we only wish we could forget.
Today’s calendar does not feature any important news releases. Therefore, the aftermath of the ECB conference will still be digested. The overall consensus of the meeting was that it was not fairly pessimistic, since rates were left unchanged and the Bank decided to keep the QE purchases at 80 bn a month. Price action in the markets was tight, as the EURUSD initially rebounded but then returned to pre ECB levels.
Currencies: EURUSD opened the day at 1.1232. reached 1.1330 highs before closing the day at 1.1267. the range in EURUSD is fairly tight along with this unlikely to modification until the FOMC meeting on September 21st. GBP/USD bounced along along with the Euro and rose to a higher of 1.3335. The Pound remains resilient overall, as recent UK economic data has actually been better than expected by numerous market participants. The Yen gained overnight, as news of a North Korea nuclear test led to a slight risk-off sentiment in markets. USD/JPY declined from 102.50 in the early Asian session to a reasonable of 102.00.
Yesterday’s ISM news release showed the biggest contraction in the services sector in the US since 2008. As per rough estimate the US Services sector amounts to about 70% of the US GDP, which gives some indication that coming Q/Q GDP numbers will suffer. As a result, the expectations for a September rate hike have actually now taken a massive hit as the FED has actually mentioned that rate hike paths are data dependent. Bank of Canada rate decision will be the main focus today and it’s widely expected to keep key interest rate unchanged at 0.50%. UK industrial and manufacturing production will be the main focus in European session.
Steven Cohen is an American hedge fund manager who was ranked by Forbes at the 106th richest man in the world for 2014 and the 35th overall in the United States. He is the founder of Point72 Asset Management and S.A.C. Capital Advisors.
Today’s main event is the ECB Meeting which is expected to remain on hold just like Australia and Canada did this week. Growth in the EU remains subdued and there is increasing stress to the ECB to act as reasonable inflation continues despite massive easing programs. The rate decision, will certainly be followed by a press conference along with ECB President Mario Draghi. A possible downgrade of economic forecasts is expected to additionally be communicated, something that could hurt the EUR.
Currencies: Overall the USD still remains the weakest currency this weak as the market continues to pare back expectations on Fed hike along with futures pricing a 15% of September hike and 50.7% opportunity for December. EUR/USD opened in Asia 0.15% lower at 1.1245 after a quiet session overnight. The EUR market is extremely quiet ahead of the ECB announcement later today and the range of last days could remain the same if there are no changes from expectations. GBP/USD is flat at 1.3335, while AUD/USD is trading 0.55% higher at 0.7708 after positive China trade data.
Evdokia Pitsillidou, Risk Associate, easyMarkets
Very few people outside the investing globe know that base metals could be traded on the futures and options markets. Even within the trading community, metals trading is often synonymous along with precious metals – the glittery earth-rare commodities that are used as currency or other forms of payment. While gold and silver could be great way to diversify one’s portfolio, they are not the only metals that could be traded for profit.
In the financial market, it is often said that you should go big or go home. Along with higher risk comes the promise of higher rewards and some gamers didn’t hesitate to up the ante when the situation called for it, reaping huge returns on their correct market calls. Here are some of the riskiest traders that paid off.