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Positive performance in Asian and European stock exchanges…

Positive performance in Asian and European stock exchanges… Slight declines in major commodities

Positive performance in Asian and European stock exchanges:

This week began with a weak start today,
as the performance of many traded assets and financial instruments did not change.

This week contains many events that may turn the table.

 

In general, hopes of stimulus package and developments of the global epidemiological situation continue to weigh on markets.

Therefore, Evest is daily following up developments in global markets so as to help its traders to take the right decision at the ideal time.

 

Oil is retreating amid fears of the epidemic situation in China

Oil prices slightly decreased at the beginning of this week trading on Monday,
as they are still affected by the epidemic situation in China.

 

Brent crude futures for March delivery declined by $ 0.03 or 0.05%, to trade at $ 55.38 a barrel.

It had been fallen by $ 0.69 and by 1.2% to record $ 55.41 a barrel last Friday.

 

US West Texas Intermediate crude declined by $ 0.02, at a rate of 0.04%, to trade at $ 52.25 a barrel.

On Friday, West Texas Intermediate crude fell by $ 0.86 at a rate of 1.6%, to trade at $ 52.27 a barrel.

 

Merchants continue to monitor the epidemiological situation in China as 124 new cases of Coronavirus
“Covid-19” were discovered on Sunday, up from 80 on the previous day.

 

Fears are exacerbated by the fact that the new outbreak shortly occurred before Lunar New Year,
in which fuel consumption is increasing in China.

Now, with the increasing number of infections,
the country recommends not traveling and imposes restrictions on moving,
which by its turn will harm oil.

 

On the other hand, date from the US oil services company Baker Hughes,
which last Friday showed an increase in the number of oil rigs by
two units operating in the United States last week, to reach 289 drilling rigs.

Rig numbers have increased for 9 consecutive weeks but this number is still lower than last year, as it reached 676 rigs.

 

Gold continues its downward rally for the third session in a row

Today, gold prices slightly fell to extend their decline for the third session in a row.

Despite the decline in the US dollar index, gold was also unable to rise as traders turned to risky assets and went away from safe-havens.

Gold is slightly trading lower to reach $ 1.854 an ounce after falling by 0.5%, during the last session.

Gold is being pressured by the absence of signals from major central banks about monetary policy or monetary easing operations.

 

Gold may arise during the coming period, supported by a huge US stimulus,
a high number of cases of Coronavirus Covid-19,
in addition to increasing tensions between the United States of America and China.

 

This week, the economic calendar is considered busy.

This may mean more volatility in precious metal markets.

 

A meeting of the Federal Open Market Committee will be held on January 27,
as United States will release fourth-quarter GDP data on January 28,
in addition to core PCE inflation data on January 29th.

 

FOMC meeting is supposed to reveal Fed’s rate decision which expectations indicate that it will remain stable as it is.

 

In general, traders are awaiting the speech of Jerome Powell,
Chairman of the Federal Reserve to stand about any evidence of monetary policy during the coming period,
especially since a fragile economy due to Coronavirus may make the Federal Reserve intervene in the near future.

This could mean more weakness for the dollar but more strength for gold prices.

 

Fourth-quarter US GDP is expected to increase by 4.0% QoQ moderating from a strong recovery
of 33.4% which had been witnessed during the third quarter.

A lower than expected reading may lead to a drop in the US dollar but an increase in goal prices
and vice versa if numbers are stronger than expected. 

 

Recovery in Asian stock markets…
Suffering in the US because of disappointing corporate results

Despite better-than-expected statistics, Wall Street ended its trading in red on Friday,
affecting by disappointing corporate results as Dow Jones fell by 0.6%to trade at 30.997 points but
Nasdaq Composite managed to snatch a slight 0.1% gain to trade at 13.543 points.

 

Dow Jones was affected by a decline of Intel which decreased by 9.3%,
after it reported a revised net profit of 6%, to record $ 6.2 billion for the last three months of the last year 2020.

 

IBM also fell by 9.9% after the IT group reported a net profit of $ 1.9 billion during the fourth quarter,
shrinking at a rate of 56%from the same period.

Disney performed much better as it was up 0.9%.

 

In Asia, markets showed a positive start at the beginning of the week after a recent setback for stock markets there.

 

Main Tokyo Nikkei 225 index closed with a gain of 0.7%.

Topix index rose by 0.29%, at a rate of 5.36 points to close at 1862.00 points.

Hang Seng in Hong Kong rose nearly 2%.

Chinese CSI 300 Index of the 300 most important stocks in Shanghai and Shenzhen Stock Exchange, rose by 1.15%.

 

Australian S&P /ASX 200 index rose 0.4% to trade at 6,824,70.

South Korea’s Kospi rose by 2.1%, to trade at 3207.64 points while Shanghai Composite Index-
was unchanged much as it rose less than 0.1%, to trade at 3609.09 points.

 

In Europe, the sentiment is also rising due to support of the US stimulus package as Eurostoxx 50 futures and FTSE
London futures rose at a rate of 0.3% for each. German DAX futures rose by 0.4%.

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