FUNDAMENTAL REVIEW 29.10.12

 

Investors are awaiting the results of elections in the United States

 

Tension in world markets continues to grow, pending the outcome of the U.S. presidential election. This is primarily determined by the uncertainty that exists. So far, no candidate has received a decisive majority, which means investors do not have a clear and a clear view on the prospects of a new program of quantitative easing and the possibility of so-called "fiscal cliff" is still in force.

 

Friday's GDP data for the third quarter in the U.S. were better than expected + 2.0% compared with an expected growth of 1.8%. Growth in consumer spending, federal government spending, and a clear improvement in the housing market indicates that the economy continues recovering, though still rather slow pace due to European problems. But the data could not support investor sentiment, as the prospect of elections continues to put pressure on the markets.

 

In the currency market, the same uncertainty continues. Concern over Greece, and unclear prospects of appeal whether Spain for financial aid is a negative factor for the single currency, and in general for the propensity of investors to buy riskier assets.

 

Lowering the last week by the rating agency Standard & Poor's credit rating of the bank BNP Paribas, due, according to the agency, increasing the "economic risks" in France, as well as in southern Europe, where the French bank a significant presence, does not add optimism to investors. S & P also placed the ratings of the French Credit Agricole, Societe Generale and BPCE on the upward revision of the negative.

 

Today active in global markets may be reduced because of approaching the U.S. East Coast hurricane, which forced to close their doors NYSE and NASDAQ.

 

In general, one can hardly expect major movements in the markets before the U.S. elections.

 

Today we should pay attention to the statistics from Germany and the USA.

 

Statistics today:

Moscow time

during the day Germany Preliminary data on the consumer price index in October n / a; 0,0% m / m and 0.0% m / m

14.30 UK change in total private lending September n / a; 0,6 billion pounds -0.4 billion pounds

14.30 UK Money supply M4 September n / a; 0,4% m / m and 0.2% m / m

14.30 UK Number of approved applications for mortgage September n / a; 49.000; 48.000

17.30 U.S. core consumer price index in September n / a; 0,1% m / m and 0.1% m / m

17:30 U.S. September Consumer spending n / a; 0,6% m / m and 0.5% m / m

17:30 U.S. September consumer income n / a; 0,5% m / m and 0.1% m / m

 

Sergei Kostenko