CFD Markets News and Forecasts — 05-01-2018

The report was issued today by Anthony Nieves, Chair of the Institute for Supply Management Non-Manufacturing Business Survey Committee:

"The NMI registered 57.4 percent, which is 2.7 percentage points lower than the October reading of 60.1 percent. This represents continued growth in the non-manufacturing sector at a slower rate. The Non-Manufacturing Business Activity Index decreased to 61.4 percent, 0.8 percentage point lower than the October reading of 62.2 percent, reflecting growth for the 100th consecutive month, at a slightly slower rate in November. The New Orders Index registered 58.7 percent, 4.1 percentage points lower than the reading of 62.8 percent in October".

U.S. stock-index futures advanced on Friday, as U.S. stocks extended a new year rally that had pushed indexes to record levels on signs of robust growth across major economies.

Global Stocks:

Nikkei 23,714.53 +208.20 +0.89%

Hang Seng 30,814.64 +78.16 +0.25%

Shanghai 3,392.36 +6.65 +0.20%

S&P/ASX 6,122.30 +45.20 +0.74%

FTSE 7,714.36 +18.48 +0.24%

CAC 5,458.28 +44.59 +0.82%

DAX 13,307.15 +139.26 +1.06%

Crude $61.51 (-0.81%)

Gold $1,321.50 (-0.01%)

(company / ticker / price / change ($/%) / volume)

Canada's merchandise trade deficit with the world totalled $2.5 billion in November, widening from a $1.6 billion deficit in October. Imports were up 5.8% and exports rose 3.7%, both due largely to increased activity in the automotive industry.

Total imports rose 5.8% to $48.7 billion in November, the strongest increase since July 2009. Increases were observed in 10 of 11 sections. Volumes rose 5.0% and prices were up 0.7%. Imports of electronic and electrical equipment and parts, motor vehicles and parts, as well as aircraft and other transportation equipment and parts contributed the most to the growth in November. Year over year, total imports were up 8.1%.

Cisco Systems (CSCO) upgraded to Buy at BofA/Merrill

The U.S. Census Bureau and the U.S. Bureau of Economic Analysis, through the Department of Commerce, announced today that the goods and services deficit was $50.5 billion in November, up $1.6 billion from $48.9 billion in October, revised. November exports were $200.2 billion, $4.4 billion more

than October exports. November imports were $250.7 billion, $6.0 billion more than October imports.

The November increase in the goods and services deficit reflected an increase in the goods deficit of $1.7 billion to $70.9 billion and an increase in the services surplus of $0.1 billion to $20.4 billion.

The unemployment rate continued on a downward trend, decreasing by 0.2 percentage points to 5.7%, the lowest since comparable data became available in January 1976.

The employment increase in December was concentrated in part-time work, which rose by 55,000.

The additional employment in December builds on growth observed in October and November. This boosted gains for the fourth quarter to 193,000 or 1.0%, the most robust rate of quarterly growth since the second quarter of 2010.

In the 12 months to December 2017, employment was up 423,000 (+2.3%), with nearly all the gains in full-time work (+394,000 or +2.7%). Over the same period, total hours worked grew 3.1%.

The unemployment rate followed a downward trend in the 12 months to December, falling 1.2 percentage points over this period. A year-end review is presented in a separate section below.

In December, the unemployment rate was 4.1 percent for the third consecutive month. The number of unemployed persons, at 6.6 million, was essentially unchanged over the month.
Over the year, the unemployment rate and the number of unemployed persons were down by 0.6 percentage point and 926,000, respectively.

The labor force participation rate, at 62.7 percent, was unchanged over the month and over the year. The employment-population ratio was unchanged at 60.1 percent in December but was up by 0.3 percentage point over the year.

Total nonfarm payroll employment rose by 148,000 in December. Job gains occurred in health care, construction, and manufacturing. In 2017, payroll employment growth totaled 2.1 million, compared with a gain of 2.2 million in 2016.

In December, average hourly earnings for all employees on private nonfarm payrolls rose by 9 cents to $26.63. Over the year, average hourly earnings have risen by 65 cents, or 2.5 percent. Average hourly earnings of private-sector production and nonsupervisory employees increased by 7 cents to $22.30 in December.

AUD/USD has been following a strong bullish movement for couple weeks.

At this moment, there is no signs of a trend invert, however, if the price starts to correct its last bullish movement it can be interesting to follow closely.

Our suggestion is to wait for that correction in order to start a new bullish movement.

Euro area annual inflation is expected to be 1.4% in December 2017, down from 1.5% in November 2017, according to a flash estimate from Eurostat, the statistical office of the European Union.

Looking at the main components of euro area inflation, energy is expected to have the highest annual rate in December (3.0%, compared with 4.7% in November), followed by food, alcohol & tobacco (2.1%, compared with 2.2% in November), services (1.2%, stable compared with November) and non-energy industrial goods (0.5%, compared with 0.4% in November).

December saw a ninth consecutive monthly rise in sales at eurozone retailers, thereby equalling the longest period of growth in the series history (level with that seen in 2006). Rates of expansion quickened in Germany and France, while monthly retail sales fell only marginally in Italy. The headline IHS Markit Eurozone Retail PMI® - which tracks the month-on-month changes in retail sales in the bloc‟s biggest three economies combined - rose to 53.0 in December, from 52.4 in November.

Over a year, the Consumer Price Index (CPI) should increase by 1.2% in December 2017 according to the provisional estimate made at the beginning of January 2018. After four months of rise, the year-on-year inflation should thus be stable. This stability should result from a slowdown in energy prices and food prices, offset by an acceleration in tobacco prices and a lesser drop in manufactured product prices. On the other hand, services prices should increase at the same pace as in November.

Over one month, consumer prices should accelerate: +0.3% after +0.1% in November. This sharper rise should come from a rebound in services prices and in manufactured product prices. On the other hand, energy prices should slow down in the wake of those of petroleum product prices. Tobacco prices should decelerate too. Lastly, food prices should be stable over one month.

In trend terms, the balance on goods and services was a deficit of $194m in November 2017, a turnaround of $296m on the surplus in October 2017.

In seasonally adjusted terms, the balance on goods and services was a deficit of $628m in November 2017, an increase of $326m on the deficit in October 2017.

Between October and November 2017, the trend estimate of goods and services credits fell $103m to $31,852m.

In seasonally adjusted terms, goods and services credits rose $141m to $31,853m. Non-rural goods rose $394m (2%) and rural goods rose $25m (1%). Non-monetary gold fell $425m (23%). Net exports of goods under merchanting remained steady at $53m. Services credits rose $147m (2%).

According to estimates of the Federal Statistical Office (Destatis), retail turnover 2017 in Germany is expected to be between 2.7% and 3.1% higher in real terms than in 2016. In nominal terms turnover is expected to increase by between 4.5% to 4.9%.

This estimation is based on data for the first eleven months of 2017. In this period retail turnover showed an increase by 2.7% in real terms and 4.6% in nominal terms compared with the corresponding period of the previous year.

According to provisional data, turnover in retail trade in November 2017 increased 4.4% in real terms and 6.2% in nominal terms from November 2016. The number of days open for sale was 26 both in November 2017 and November 2016.

EUR/USD

Resistance levels (open interest**, contracts)

$1.2203 (6621)

$1.2160 (3990)

$1.2122 (4199)

Price at time of writing this review: $1.2061

Support levels (open interest**, contracts):

$1.1999 (2001)

$1.1950 (4092)

$1.1900 (4868)

Comments:

- Overall open interest on the CALL options and PUT options with the expiration date January, 5 is 104128 contracts (according to data from January, 4) with the maximum number of contracts with strike price $1,2200 (6621);

GBP/USD

Resistance levels (open interest**, contracts)

$1.3653 (3274)

$1.3614 (2720)

$1.3587 (4427)

Price at time of writing this review: $1.3558

Support levels (open interest**, contracts):

$1.3488 (1165)

$1.3450 (2015)

$1.3400 (2321)

Comments:

- Overall open interest on the CALL options with the expiration date January, 5 is 34505 contracts, with the maximum number of contracts with strike price $1,3500 (4427);

- Overall open interest on the PUT options with the expiration date January, 5 is 36792 contracts, with the maximum number of contracts with strike price $1,3250 (2808);

- The ratio of PUT/CALL was 1.07 versus 1.07 from the previous trading day according to data from January, 4

* - The Chicago Mercantile Exchange bulletin (CME) is used for the calculation.

** - Open interest takes into account the total number of option contracts that are open at the moment.

European stock markets posted broad-based gains on Thursday, joining a global rally that has taken Japan's benchmark index to a 26-year high and sent all three major U.S. indexes to fresh records. Major energy companies helped to propel equity markets higher in Europe as oil prices hit a three-year high, while car maker shares jumped after better-than-expected U.S. auto sales data.

The global stock rally continued in Asia early Friday, with numerous markets hitting fresh multiyear highs - though gains show signs of cooling. Japan's Nikkei Stock Average NIK, +0.66% , which rose as much as 0.7% early to notch another 26-year best after Thursday's pop, finished morning trading up 0.2%.

U.S. stock-market indexes closed at all-time highs on Thursday, while the Dow topped the 25,000 milestone for the first time. All four benchmarks set intraday records, rising for the third straight session. The S&P closed at a record in each of the first three trading days of the new year, the first time it has done so since 1964, according to The Wall Street Journal Market Data Group. The Nasdaq did the same, for the first time since 1999.