Morning Call. Market Overview for 17.11.2016

The Big Picture

Italy´s leader Renzi`s future largely depends on the result of the Italian referendum on the 4th of December. On this day, citizens will vote on the largest reform package in recent history. It is the mother of all reforms. Italy´s citizens need to vote, as Renzi has no parliamentary majority to enforce change. The reform concerns the second Italian parliamentary house, who´s composition and powers would be radically shortened. Decisions should be made at a faster pace and the high costs involved cut. Renzi wants to curtail the Justice department and reduce bureaucracy. The comedian Beppo Grillo, leader of Italy ´s “5 Star“ opposition party, sees the referendum as a chance to depose Grillo. Should a new election result from the referendum, uncertainty over Europe and the Euro will resurface. This referendum also represents a vote over Europe’s current political stance.

DAX

The DAX is in a sideways trend.  Resistance is at 10820, support at 10250.

Euro / USD

The Euro is in a downward trend.

USD / JPY

The USD is in an upward trend

Gold

Gold is bottoming. Support is seen at 1200 USD

WTI Oil

WTI Oil is bottoming

Overnight:

German equities softened on Wednesday, the DAX losing 0.66%. After initial euphoria, investors are awaiting concrete facts on Trump´s economic stimulus program. Trump needs to deliver. December´s Fed meeting now comes back in to focus of investors. After not seeing high turbulence in markets, a rate hike is becoming ever more likely. The largest loser in the DAX was Bayer, who issued a mandatory convertible bond in relation to the Monsanto takeover. The S&P 500 lost 0.16% due to profit taking in the financial sector. JP Morgan and Goldman Sacks both lost over 2%. Cisco´s profit outlook disappointed after the market had closed, the share dropped 4%. Asian markets, as well as the USD, are unchanged. Whilst Gold rises, WTI Oil drops.

Economic Data:

• 14:30 USA: Housing Starts, Jobless Claims and CPI

Quarterly Results:

• USA: Staples, Wal-Mart, Applied Materials

RoboForex Analytical Department