The US markets did a U turn last night and recovered from their losses after dropping triple digits. Investors are confident and ready to comb through more economic data which is due today. We have the trade balance number due at 12:30 GMT and the forecast is for -$40.1B while the previous number was at -$42.3B. However, it is not this data which is going to gauge traders attention a lot but the speeches from the Fed members. There is no doubt that the recent sell off in the USD is mainly due to the weakness in the rates but if we start seeing Fed becoming more bullish and optimistic about the economy, we can see a completely different picture. However, we do not think that the Fed will say anything more out of the line and will keep the market expectations inline.
Back in the Europe, the geopolitical tensions has still occupied the main stage amid traders. The situation does not seem like it will find a solution soon and it may very well actually become worse before it gets better. Moreover the European Commission has also ticked its growth forecast lower from 1.8% to 1.7%. Most of this due the weakness in France which is facing challenging situation. However, the commission has maintained their growth forecast for Germany, Italy and upgraded the forecast for the Spanish economy. The Spanish unemployment data is also due today at 07:00 GMT and the forecast is for -49.1K. The Spanish services PMI data is due shortly after this and the forecast is for 54.3K.
Disclosure & Disclaimer:
The above is for informational purposes only and NOT to be construed as specific trading advice. responsibility for trade decisions is solely with the reader. by Naeem Aslam