European markets and U.S. futures are trading higher as investors are little optimistic about the corporation of the two big countries: the U.S. and China, in order to resolve the issues the trade war. The S&P 500 index is still holding on to its solid yearly gain of 5.26% while the price is testing its 50-day moving average; a break of this could be negative for the market. As for the Dow Jones and Nasdaq, both of them are also still holding higher with gains of 5.35% and 5.89%. Investors are also keeping a close eye on the partial U.S. government situation and awaiting the outcome of the Senate vote due today to open the government. From the outset, it doesn’t look like that any favorable results will be achieved because of the lack of the willingness from both sides.
Back in the currency markets, Britain’s divorce will be delayed in order to avoid the disorderly Brexit, this what traders have priced in. The sterling-dollar pair is sitting at 1.30 mark and the chances are that the pair is likely to move higher soon we have a firm answer on this. Creating unnecessary tensions is the habit of prime minister because after her defeat it was pretty much clear that if the date for the Brexit isn’t moved, there is only one outcome- a disaster for the economy. Members with significant authority from German and French government has shown their willingness to extend the Brexit as long as Theresa May takes the anti-toxic substance. Her hand is forced in the parliament to move in this direction by pro-EU members of her party and eurosceptics who still believe that they can bring her government down.
In terms of stock news, the biggest headline is for Apple (NASDAQ:AAPL) which has used the excuse of restructuring to dismiss nearly 200 people from its very important project called Titan, a project which is focused on cars. There is no doubt that Apple lacks innovation massively and there is no new product except iPhone which is in their crown jewel. If the company really wants to continue its growth it needs to make that innovation stays at its heart of the foundation. The one month implied volatility sits at 33% and the trading volume was 49% the 20-day average. The stock is still trading at 13 times its estimated earn earning
Today is also a big day for euro traders, the European Central Bank is meeting and will announce its monetary policy. The intriguing element is if they are going to provide any further evidence about the on-going slow down in the economy, and most importantly if they are going to acknowledge it. The biggest wildcard for today’s meeting is if the ECB is going to say anything about the extension of the TLTRO, an easing monetary policy measure. If they did, it means even lower euro where it is trading today.