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While the US indices closed premium under the leadership of technology stocks yesterday, an intensive balance sheet period is observed. Morgan Stanley’s Apple shares rose sharply behind the Apple stock target price. The important balance sheet announcements of the week include Amazon.com, Alphabet, Unilever, Caterpillar, Coca-Cola, McDonald’s and Boeing.
Following Iran’s detention of the British tanker in the Persian Gulf, speculation that supply in the region may be interrupted, raising oil prices.
Asian stock markets found support this morning at the ECB meeting Thursday, with the expectation that the FED will cut interest rates next week.
While futures contracts price the ECB will cut deposit rates by 10 basis points with a 43% probability, economists predict that ECB will not change interest rates this week but will signal a cut in September. The pound has depreciated in the third consecutive session, fearing that the conservative party will elect Boris Johnson, the new party leader and pro-EU leader as prime minister. The euro is trading at 1.1180 today with a 0.24% loss after falling 0.12% yesterday, expecting an interest rate cut from the ECB. Due to losses in the euro and sterling, the dollar index is currently at a premium of 0.23%.
The LME copper rose to $ 6170.5 on Friday, with the NY FED president pointing to a 50bps reduction, but failed to stay above the $ 6070 technical level. LME copper fell 0.95% yesterday due to strong dollar pressure, global economic growth and ongoing uncertainties about demand. Expectation of interest rate cuts in the market to a large extent copper, can not protect the premiums. The $ 5980 support was tested in the morning (min $ 5983). Below this level the nearest support will be $ 5920. The main support level is around $ 5850 for a 200-week average. FED interest rate decisions and disclosures will be decisive, but in the long run $ 5850 will remain critical.
Agenda of the week, the ongoing balance sheet season in the United States, as well as Thursday’s ECB meeting to be watched. Macro data will be followed by manufacturing PMI index in Euro Zone, manufacturing PMI, new home sales, durable goods orders and GDP data in USA.