Morning Call. Market Overview for 18.10.2016

The Big Picture

In recent years deflation has been the main focus of investors, this could soon come to an end. Many countries are now showing signs of inflation. China showed increasing producer prices last Friday for the first time in 12 years. Spain reported a rise in consumer prices for the first time since July of last year, the rise of 0.2% was not that high but shows that inflation is coming to an end. Spain isn´t the exception, other countries such as Italy, Spain and Sweden also showing inflation again. The main cause of this returning inflation are energy prices. WTI Oil has gained almost 100% since its lows in February. As such, inflation should see further growth in the first quarter of 2017 on the back of basis effects.

DAX

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

Euro / USD

The Euro is in a large sideways trend against the Dollar. Support is at 1.0822, resistance at 1.1429.

USD / JPY

The USD is in an upward trend.

Gold

Gold is in the process of bottoming. Support ist at 1240 USD

WTI Oil

WTI Oil is in an upward trend

Overnight:

The German stock market started the week with loses, the DAX losing 0.73%. BASF was amongst the losing stocks, after a large explosion at its main factory in Ludwigshafen put on pressure. Commerzbank managed to gain. After markets closed Netflix reported curtly numbers, which came in better than expected. Netflix gained 3.57 million new subscribers over expectations of a gain of 2.6 million. Additional turnover was 32% above expectations and profits were up by 75%. The stock rose 20% on the back of these excellent numbers in after market trading. Asian stocks trade higher and the USD weaker. Gold and WTI Oil are slightly higher.

Economic Data:

• 10:00 USA: Consumer Prices

Quarterly Results:

• USA: BlackRock, Intel, Yahoo amongst others

RoboForex Analytical Department