FUNDAMENTAL REVIEW 26.10.12

 

The uncertainty on the markets remains

 

The uncertainty due to the presidential elections in the U.S. continues to unnerve investors. This is the beginning to fully manifest itself with the approach of November 6. Equal chances of candidates and their different understanding of what to do in the current economic climate, contribute to this uncertainty. This forces players to cut positions to reduce risk. Concerns about the possibility of "fiscal cliff" neutralize markets, and forces them to consolidate.

As a result, the market is becoming thin and increasing volatility. But based on the dynamics of the 10-year U.S. bonds, in general, investors are looking favorably on the market. And most of all, the dynamics we see after the election - after the fact.

 

Lowering the credit ratings of a number of French BNP Paribas, Société Générale and Crédit Agricole banks by rating agency Standard & Poors dealt an additional blow to market sentiment. The single currency was under pressure, but in general it continues to consolidate.

 

Commodity currencies are reduced due to the sharp fall in oil prices, which do not support any tension around Iran, nor the events in Syria.

 

Given all the above it can be assumed that this situation will continue until the elections in the States.

 

Today we should pay attention to the U.S. GDP data for the third quarter. If the data does not disappoint, it can locally to pressure on the U.S. dollar.

 

Events today:

Moscow time

16.30 U.S. GDP grew 3 kv.2012 n / a; 1,8; q / q, 1.3% q / q

16:30 U.S. Q3 GDP deflator. 2012 n / a; 2,0% q / q and 1.6% q / q

17.55 U.S. revised data on consumer sentiment from the University of Michigan in October n / a; 82,7; 83,1

17.55 Revised data on U.S. inflation expectations from the University of Michigan in October n / a; n / a; 3,1%