Weekly Market Review 11.1.2017

The January 3 to January 7, 2017 trading comes to a higher close after the dismal figures last week. Dow Jones is still on a hold up to reach the 20K mark. Federal Reserve is still evaluating the forthcoming reports, performance, and sustainability–whether the economy could pursue a three percent-interest hike for the year in short terms. US December reports fuel the positive prediction and sentimentality over the US economy. US payroll reports prove to hold up and improve over time, where an annual rise in wages is expected and factored in. A staggering 17.55 million vehicles, including light trucks, were sold in the year 2016, compared to 17.48 million last 2015.

On the global market news, the overall global market performance ended on few highs and gains. The highlight went to China where financial resources were continuously outflowing. This led to the Chinese government optioning an 80% increase in deposit rates for the country’s offshore deposit rates. The said overnight move is not enough to maintain a market rally where it just goes back in until Friday. That is why more capital controls are implemented on countries where foreign currencies owned by state-owned businesses are encouraged to sell The move is all for the stabilization of the currency while awaiting the effect of Donald Trump’s inauguration on January 20.

To continue the global scale of market performance with regards to growth, manufacturing and capital-related activities have contributed to positive results by year-end. The US continues its positive streak as to manufacturing reports, resulting in measurable growth, which is 54.7, compared to 53.2 last month. UK’s Brexit for this year does not at all affect its PMI, which still manages to post a 56.1 figure, a lead in comparison to the last 2 ½ years.

On other news worth noting, the US retailing industry suffered during the holidays, with more consumers relying on internet-shopping. This led to most Macy’s and Sear’s square-footage decreasing, as more stores are closing and owned brands are being sold. For instance, Craftsman, Sears’ own brand, was sold for $900 million to Stanley Black & Decker.

Stock Market Closing Week

Dow Jones closed at 19,963.80, up by 1%, while NASDAQ is at 5,521.06, up by 2.6%. The same goes for S&P and Russell 2000, which followed suit, posting a 2,276.98, +1.7%, and 1,367.15, +0.7%, respectively. The gain is attributed to positive sentiments from various US reports and the anticipation of Trump’s economy-focused presidency. Nikkei 225 still struggles with a close of 19,454.33, down by 0.34%, while FTSE 100 gained. with a close of 7,210.05; +0.20%.

The EUR/USD ended with 1.0533; -(0.0074) while the USD/Yen slightly recovered to 116.99; +1.64.

Oil closed at 53.70, down by 0.11%; the same as gold, which posted 56.75, down by 0.71%.

What’s next for the entire 2017?

For an investor, always know your long-term goals, as short- term events would either disrupt your plans or they can create more opportunities and lead to better decisions. The risk that comes with it should be within the accepted limit and the expected loss during any negative volatility. Always talk to the financial advisors, as they are the right personnel to give sound advice, aside from an investor’s own preference and risk appetite. Even stock investment and other financial market instrument investment is a passive investment. Be sure to check its status and continuing ability to provide the necessary goals that are meant to be achieved.

 


Weekly Market Forecast 4.1.2017

The closing week for the market seems to imbibe better performing figures for the year 2017. The European market is slowly gaining while the Asian market is doing its best to strengthen its currency and economic activities. As for the US market, Trump’s presidency would be in for a full scrutiny based on his promised policies. We would see if they would be implemented and how they would affect the US economy and the global market as well. For the week ahead, the US reports, as well as those of other countries, would be released. The January 2nd global market would be closed.

US Reports – The December 2016 figure for ISM Manufacturing PMI is expected to reach 53.7 from the 53.2 figure last November. Trump’s policy on improving infrastructure and more internal policies, which would boost the economy, are seen as positive contributing factors to further strengthen the manufacturing side of the US economy. It is also seen that production is on an increased speed in response to higher demands.

The Federal Reserve minutes of the meeting would be released this coming Wednesday. The said report would include the outlook of the rates this 2017 after the hike last year. Meanwhile, chairwoman Janet Yellen is still firm on her stand that President Donald Trump has nothing to do with the planned interest hike as opposed to what others are complaining about. The question is whether the Federal Reserve would continue its hike on the interest rates or if they would factor in the effect of President Trump’s policy on its fiscal policies.

Unemployment claims continue to stay down and are still below the 300,000-figure, resulting in a 95-week record of below 300k. It is forecasted to hit 262,000 unemployment claims, which still provides a solid explanation for a healthy labor market in the country.

Crude Oil inventories are forecasted to continue their streak for the month of January. The holidays somewhat affected the trading for oil but as soon as January kicked in, the expected gains would be reflected.

Canadian Report – This coming Friday, Canada would release its employment data. The November report has seen 10,700 new jobs, resulting in a 6.8% drop on the country’s unemployment rate. Only the part-time work sector has seen an increase, as compared to the full- time workers, which decreased by 30,000. It is deemed that the number of people searching for jobs declined despite the labor market’s boost on creating more jobs.

European Central Bank’s Meeting Minutes The report would be released this coming Thursday. It would contain announcements and measures on stabilizing the European economy. Measures are assessed, modified, and implemented to fit the organization’s goal of creating stimulus on the overall economy of the union.

US Dollar – President Donald Trump’s official instatement is seen as boosting the value of the USD. His focus on internal improvements, certain deregulation, and increased spending on infrastructure would benefit the economy. This will further cement a strong value on the American currency. Its exchange between the Japanese Yen is still on a bearish mode, as more declines are expected for the coming week.

What’s in it for 2017?

2017 is seen as an exemplary year for trading, as necessary measures are adopted in order to stabilize each country’s economy. However, market volatility is still high and as an investor, always be cautious and take any preventive measure, which would serve as a fall back, in case the market gets awry and unpredictable. It is a fair suggestion to have an investment on both the fixed- income portfolios and equities. These two are aligned to bring a balanced portfolio when it comes to your desired target and investing goal. You also have to consider the class of portfolio it belongs to, as these different classes provide different results and patterns.

 


Weekly Market Review 4.1.2017
The holiday season took over the trading week and has seen its slight fall up to the closing week. Therefore, for the current trading week, we would take a look at the year’s highlight of the market economy for 2016. First, let us take a look at the global market news and happenings.
On the European side, the United Kingdom is seen making a revision on its growth percentage for the 3rd quarter, as the 0.6% economic expansion rate exceeded the 0.5% expected rate after the Brexit vote. On the other hand, Scotland still holds on, acting up on another referendum to maintain and insist on the UK’s stay in the European Union. After the June majority vote of Wales and England to “leave” over Northern Ireland’s and Scotland’s campaigns to stay in the EU, Scotland’s Prime Minister Nicola Sturgeon said that the referendum would happen.
Settlement had been reached between the United States Department of Justice and both the Deutsche Bank and Credit Suisse. The amount was $ 7.2 billion and $ 5.3 billion for Deutsche and Credit Suisse, respectively. The said settlement was due to the case during the global financial crisis, after the said banks started selling mortgage-backed securities, which caused the downfall of real properties. An ongoing suit is still in progress as Barclays has not yet come into any agreement with the US DOJ.
The Bank of Japan assessed a positive outlook towards its economy as signs of improvement are seen in the country. These include an uptick on export activities, which means more foreign demand and a slight overall recovery for the country.

2016 in Review
It is a polarizing trend for the year, with the best highs and unexpected lows for the market. Despite a rocky start from the beginning till the middle part of the year, the last part took charge in giving impressive results and trends in the history of the market. Brexit became a term for the global market news circulation, which led to more global market uncertainty. More banks around the world provided extensive monetary measures to improve the economy and inflation rate.
Needless to say, it was the US election that put a mark on the daily conversation and topic of every economic player and media outlet on a global scale. Post-election events truly reflect the rally on the US stock market as the contention of strong economic policies were seen as a positive response towards the Trump presidency. On the downside, the US dollar strengthens over other markets such as the yen, Mexican Peso, and other currencies, resulting in multi-national companies’ low return on the US dollar- based investments in a certain country.
OPEC has finally reached an agreement to cut oil production, resulting in a slow rise in its price per barrel, after suffering from a $26 per barrel record low for the last 13 years and reaching above the $50/per barrel price.

Week Closing Results
Dow Jones closed at 19,763, down -0.9%; NASDAQ at 5,383, down 1.5%; while S&P 500 took a -1.1% decrease, closing at 2,239. FTSE 100 recovered well, closing at 7,142.83, up on a +0.32% change, and DAX with 11,598.33 (+1.02%). Nikkei 225 plunged further with a close of 19,114.37 (-0.16%) while the Shanghai Index gained with a close of 3,103.00, up 0.24%.
Oil prices closed at $ 53.83, gaining a further increase of 1.5% while gold closed at 1,152.00 (1.22%).

2017 in View
The US economy is expected to perform well based on this last-part-of- the -year performance. As usual, always have appropriate expectations, as the policies that would be implemented could still factor in a few risks and uncertainty towards the short-term investment period. Long-term planning is still the best option for weathering out any uncertainty and market volatility. The right mix of investments should always be in play to achieve portfolio stability.


Weekly Market Forecast 26.12.2016

The market would be closed this coming Monday for the holidays, but the Trump effect could already be seen on the US stock market’s performance in the trading market over the past eight weeks. Currently, Dow Jones, mostly composed of large cap stocks, could be pushing to the 20,000th level in the coming weeks. However, with the holidays coming up, trading would be a little slower. As such, the 20 thousand figure would likely not be reached. Nevertheless, it is best to decide on how to play the cards on the US stock market movement when Donald Trump assumes the presidency this coming January. The positive sentiment could still be outweighed by the global reaction to the policies Trump would be implementing. Multinational investors would still be wary of the US Dollar’s effect on most foreign currencies, with a direct effect on the country’s deflation and strength against the USD.

As a year-ender preparation for a better outlook in the coming year, investors should still be cautious. It is true that the pro-economic policies to be implemented by the incoming administration include tax-rate cuts and infrastructure focus among others. However, the probability of resistance to these policies could still wager an effect on the stocks’ performance, depending on how the general public would react to it.

The global market should also take a close look at the US market’s effect. The outlook of the policies would veer less toward globalization but more on the national stimulus. The US dollar is seen to perform well at the expense of reliant currencies, with US investors on the respective country of operation. The Asian market is still on the verge of pressure against the USD. It is seen to be a quiet year-end in the Asian market. Many measures have been implemented by both the Japanese and Chinese governments to improve their monetary policies against the disparity in USD strength and its economic effect.

Oil prices are seen to continue its gaining streak for the coming weeks, benefiting from the upcoming cut in oil production starting next month. Gold and silver, along with other precious metals, still remain bullish until the coming weeks, which add to the effect of the rising inflation rate.

Here’s a look at the events that would transpire in the coming trading week.

EUR/USD – the coming holidays would be slow and light for trading between the two currencies. Although year-end figures would bring adjustments to the closing amount, it would still be a wise decision to consider waiting until next year. This would make for a fully-decided move by means of a better examination based on how the currencies outlook would look like,

Monday: December 26; Report for the Japanese Inflation and Unemployment figures for the month of November would be released. It is forecasted that a 0.2% down rate for inflation would be presented, as compared to the 0.1% increase last October. Unemployment data is forecasted to still remain at 3%.

Tuesday: December 27; Japan’s report for industrial production and retail sales are at a mix. Industrial production is seen to hike at 0.44% against a 1.4% decline in October. On the other hand, the retail sales report would strike down a 0.1% fall rate last October, further sliding by 0.9% in November. The US Consumer Confidence for December would be released against the November figure of 107.1.

Wednesday: December 28; The Pending Home Sales for the US, covering the month of November, would be released with a forecasted figure increasing by 1.62%, topping the 1.8% increase last October.

Thursday: December 29; The US Unemployment claims is forecasted to decrease further to the 271,000 figure against a 274,000 report from November. Oil inventories are also forecasted to strike low by 300,000 barrels from the 2.25 million last week.

Friday: December 30; PMI reports for the US would be released with a forecasted figure of 52.3 for December against the 57.6 last November.

 


Weekly Market Review Dec. 26, 2016

Good record gains have been ticking over the trading week, with the Dow Jones nearing its 20,000th mark. Although it can be seen as a week-per-week improvement on the overall stock market, it should be noted that uncertainty still looms over the market as volatility is high. Policies that would be put into place once the Trump administration takes over come January of next year could still play a pivotal role. This could result in a lot of decision-making, which would definitely affect the issues and events on a global market scale. Oil prices still continue to improve over the week.

Accordingly, Asian markets all closed on a low note, with the trading indexes decreasing, compared to last week’s figures. The Chinese yuan still continues its drop against the US dollar while the Chinese Academy of Social Sciences quoted that the next year’s GDP of growth for the country would slow down and reach 6.5% lower than the estimated 6.7% rate of the current year. The said move would be tied to the implemented monetary policies, to further boost the country‘s economy from the impending asset bubbles that are ready to slow down the market. Japan has not changed its current rates, and the monetary policies still remain. It is said that the Japanese yen is suffering from the current exchange rate relative to the USD, as US- based investors are affected directly by the conversion rate it generates. Despite this, the country is still optimistic as it would push to further improve on the economic movement of import. Its export is expected to further recover from the deflation it is currently into.

The European market mostly remains unchanged while many banking regulations are implemented to ease the pressures among other sectors. On other news, Deutsche Bank and Credit Suisse have both settled fines against the US Department of Justice, with USD 7.5 billion and USD 5.3 billion, respectively. The said settlement was due to alleged mortgage-backed securities, which both parties have resolved. It is estimated that 40-45% was paid in upfront cash. The remaining balance would be paid through what they call “consumer relief.” This would lessen the impact for both banks with regards to their capital.

Global Stock Market

The US stocks impressively closed on all positive indexes. Dow Jones falls short on its 20,000 target, closing at 19,933.81 up +0.07%; NASDAQ closed at 5,462.69 (+0.28%) while S&P 500 bowed at 2,263.79 up +0.13%; and the consistently performing Russell 2000 closed at 1,371.51 up +0.65%. On the other hand, the Asian market is on a down, with Nikkei 225 closing at 19,427.67, down -0.09%, and Shanghai Composite at 3,110.15 (-0.94%). European stocks slightly make a figure improvement. Stoxx Europe 600 closed at 359.98, up by a mere 0.04% while UK FTSE 100 closed at 7,068.17, up by only +0.06%.

Global Currencies

The Euro/USD closed at 1.0456, with a mere change of 0.0018. On the other hand, the Japanese yen continues to struggle against the USD, closing at 117.32 (-0.22). The GBP/USD exchange posited a slight movement on the rate, closing at 1.2288, with a change of 0.0002.

Commodities

Crude oil continues its gaining streak, closing at 53.25, posting a +0.57% change. The same goes for gold, closing at 1,135.20, with +0.40% change.

The US market, especially in the case of Dow Jones, aims to reach the 20,000 level. As such, it may act as a happy trigger for investors who may be reliant on the market’s positive performance. However, this is not the case as these indexes among stock groups pertain to the performances of their components. They are not a guarantee of eventual gain in the coming months; rather, they’re a stimulus to be observed and taken into consideration with regards to your investing goals. Yes, the sentiment all over the market would be positive once it reaches the 20 thousand figure, but remember that these figures are only indicators of what you should do. As always, take the necessary steps for the appropriate diversification of your portfolio.


During the 2016/2017 Christmas & New Year Holiday season, the trading times will be as follows:

Instrument 23/12/2016 26/12/2016 27/12/2016 30/12/2016 2/1/2017
Forex Normal Hours Opens 06:00 Normal Hours Normal Hours Normal Hours
US Shares Normal Hours Market Closed Normal Hours Normal Hours Market Closed
UK Shares Early Closing at 14:30 Market Closed Market Closed Early Closing at 14:30 Market Closed
German Shares Normal Hours Market Closed Normal Hours Normal Hours Normal Hours
French Shares Normal Hours Market Closed Normal Hours Normal Hours Normal Hours
US Futures Indices Normal Hours Market Closed Normal Hours Normal Hours Market Closed
UK Futures Indices Early Closing at 14:30 Market Closed Market Closed Early Closing at 14:30 Market Closed
European Futures Indices Normal Hours Market Closed Normal Hours Normal Hours Market Closed
Agricultural Futures  Early Closing at 20:00 Market Closed Normal Hours Normal Hours Market Closed
Spot Energy Normal Hours Market Closed from 15:00 to 20:00 Normal Hours Market Closed
Energy Futures Normal Hours Market Closed Normal Hours Normal Hours Market Closed
Precious Metals Normal Hours Market Closed Normal Hours Normal Hours Market Closed
All Spot Indices  Normal Hours Market Closed Normal Hours Normal Hours Normal Hours

The times mentioned above are in server time (GMT+2).

The above schedule may be subject to change.

Clients are advised to be extra cautious when trading between 24/12/2016 – 04/01/2017. During this period, reduced levels of liquidity are expected, which are likely to result in wider spreads. CIBfx reserves the right to enable “Close Only” or even disable trading on instruments with low liquidity without prior notice, if deemed necessary.

Please feel free to contact us if you have any questions.

 


Weekly Markets Forecast 20.12.2016

The short-term interest rate has been increased by the US Federal Reserve last Tuesday, which has resulted in a record high for the US stock indexes. Furthermore, the US Fed is also planning a three-part hike on the rate for the year 2017. It is quite remarkable that the US economy is seen to improve over the coming year, with the possibility of a continued hike of the said rate. Oil prices were also forecasted to hit the $60 per barrel price share for the coming year. The US economy is still seen as being in the bullish mode, as the released reports are all optimistic of producing positive effects. Here’s an outlook for the coming week December 19-23, 2016.

  • US Reports – Wednesday would see the release of the US Crude Oil Inventories report. In contrast to the past forecast of the 1.4 million barrels decrease, it exceeded the said figure with a staggering 2.6 million barrels.

Thursday would be the release of US Durable Goods Orders, expected with a 0.2% increase against a 4.8% figure for October. The increase for the past month was attributed to a strong commercial aircraft demand and the maintenance of a slow but steady growth in the country’s manufacturing industry. The US GDP Data for the third quarter is forecasted at a 3.3% figure, after exceeding expectations from the previous quarter. The increase was attributed to increases in exports and increased investments in the country itself; thus providing a positive outlook. US Unemployment Claims is forecasted at a figure of 255,000 which would still continue the trend of being below 300,000 for the 93rd time.

  • Interest Decision in Japan – The Bank of Japan will be holding a meeting this coming Tuesday to come up with a decision regarding their monetary policy. During the last November meeting, the bank retained its current policy even though it was not able to meet its inflation rate deadline. As expected, the said target inflation rate would be achieved only by 2018. Based on what the Bank of Japan is currently feeding the news, they said that the policy would still stay as long as no event would cause the unstable economic status of the country to continue, particularly its decline against foreign currencies. Deflation is a major factor to be considered in the meeting, since it really affects the foreign investments in the country.
  • Canadian GDP Report2017 is forecasted to have an overall growth of 2% from the 1.1% of 2016, according to the Bank of Canada. The third quarter Canadian GDP report is forecasted to have an increase of 0.1%. The second quarter GDP report also forecasts a gain, which is attributed to the increased exports of energy products.
  • New Zealand GDPThe third quarter GDP report is forecasted at 0.8%, after a 0.9% growth report for the second quarter. Both export and the country’s own demand for products is still paving the way for a positive outlook on the country’s economic stability. The overall growth figure would be forecasted at 3.7%. These optimistic figures would still uphold the policy of not cutting rates as suggested by the Reserve Bank of New Zealand.
  • Ifo Business Climate Index for GermanyThe December 2016 business sentiment would reach 110.7, as forecasted, compared to 110.4. The US election has currently no effect on the German economy, but with Brexit and the elections, the effect is seen to come later within the next period.
  • The EUR/USD would still have a bearish outlook in the coming week as on the Euro side, European Central is continuing its bond buy-off to stabilize the Eurozone. Meanwhile, the US side is chomping up on how the Trump policies would affect the overall picture of both economies. The Euro/USD, as forecasted, could be seen dropping for the coming week.

Weekly Market Review Dec. 19, 2016

As expected, the US Federal Reserve increased the short term interest, bringing in another 0.25%, resulting in 0.75%, while the stock market resulted in a mixed trade. On a global scale, the USD continues its strength over other currencies. This week would show an in-depth view of what the hike would mean and how it would affect the global market.

US Federal Interest Hike

Many analysts believe that the US economy would improve in the coming year, but not because of the US elections. The fiscal policies and measures Trump would like to implement on the country’s economy would not happen overnight. It would still undergo the formal process of being enacted as laws; therefore, time would still be a variable on when it would show positive or negative results for the said measures.

  • The US economy had seen its growth in GDP, passing the 3% mark. This would mean that the economy as a whole could support the country. The US Federal Reserve is seeing the increase as a positive indication of improvement in many areas of the US economy. Inflation rate is forecasted to continue its 2% increase over the course of two years. On the other hand, the labor market makes the economy more sustainable for improvement and to accommodate more jobs.
  • It is likely that there would at least be three more announcements to raise the interest for the coming year. However, this would still depend on how the move would affect the whole economy, over the course of the Trump administration. The global economy should be considered as well. It should also be taken into consideration that the enactment of laws that will allow these measures to take full effect will be needed. This would also depend on how fast the current administration will implement them.
  • The US Dollar’s rise in value should also be viewed with caution. This would affect the multinational companies’ return when its denomination currency is devaluing over the country it operates on. This means that the US companies’ foreign investments, which suffer from a devaluation over the US Dollar, would have a lower return.

 

Market Close Recap

Global Stocks

Mixed closing numbers were reflected last Friday, December 16, for S&P 500 Index (2,258, -0.1%) and NASDAQ (5,437, -0.1%) but not for Dow Jones (19,843, +0.4%). Although the highlight for the week was Tuesday, trade has seen record highs for most indexes after the US Fed’s announcement on interest rate.

The Asian market has seen improvement with the Japanese Nikkei 225, closing at 19,401.15 and with a +0.66% change. Stoxx Europe 600 closed at 360.12, up by 0.34%. The same goes for UK’s FTSE 100 with +0.18%, closing the index at 7,011.64.

Currencies

As stated earlier, the US Dollar is rallying with its value over other global major currencies. Despite the positive closing week for the Nikkei, the Japanese yen is considerably suffering from devaluation after the US elections, with its rate currently at 11%. The same goes for the Chinese Yuan where the government is consistently selling its foreign currencies to avoid further devaluation.

The Euro/USD closed at 1.0451 (+0.0036) while the GBP/USD closed at 1.2485 (+0.0065). The Japanese yen continues its negative streak, closing at 117.92 (-0.25).

 Commodities

Crude oil continues its increase, closing at 52.03 with +2.22% change compared to last week. The same holds for gold, closing at 1,136.80 (+0.62%). The related rally on oil prices was triggered by non-OPEC members starting a production cut of 558,000 barrels/day while OPEC member Saudi Arabia posited that further cuts in its production could be implemented.

Viewpoint for the Coming Year

The coming year would be more volatile. That is why the best course of action is to know what you should expect and do regarding your portfolio. As the rates could possibly be raised over time, slowly steer away from portfolios that provide fixed-income returns. Always check your appetite for risk. This is so you could further assess and set the balance of the mix of your stocks, bonds and other investments, which would be volatile and show more unpredictability.


Market Forecast 12.12.2016

US Stocks took gains in the closing week, as the Trump presidency somewhat manages to deliver positive results in the market. After an agreement among members and non-members of OPEC to cut oil production, the price for oil products continually reaches an uptick for the past few weeks. The coming week is a headliner. Italy would decide whether to vote. Then it remains to be seen how their decisions would affect the Italian banks. As for the US, many are awaiting an anticipated increase in interest aside from the economic reports to be released, including unemployment, retail, and PPI’s.

  • UK Reports – Inflation and employment figures would be released in the coming trading week. Inflation data that would be released on Tuesday has an expected hike rate of 1.1%, representing the month of November, as compared to 1% last October. The said hike, based on analysts’ forecasts, are from the advancement in raw materials’ price, contradicted by the slow growth in tuition fees in the university and clothing prices. As for the employment data to be released on Wednesday, 6,200 is the forecasted figure that would reflect against 9,800 last October. Based on the analysis, the streak in momentum for the country’s labor market is losing. GBP is continuously depreciating over the USD, resulting in increased figures in inflation. On the other hand, the Bank of England is optimistic for an economic turnaround, which will improve its growth rate, enabling it to reach its target inflation rate.
  • US Reports – Retail reports would be released next Wednesday. This happens after a strong return from higher sales of automobiles and a great outlook of sale on construction materials. This would be further strengthened with the impending Fed interest hike on interest rate. The expected figure for retail sales would increase by 0.3%, while 0.4% is for core sales. As for Producer Price Index, the expected figure would be increased by 0.1% for the month of November. The Inflation report is seeing an increase, with a forecasted increase of 0.2%, which is an indicator for the Fed to pursue the increase in interest rate.

The US unemployment claims figure is continuing to stay below the 300,000 mark despite the forecasted 252,500, which a thousand more compared to the last report. The below 300K mark is a significant measure to say that the US labor market is stable, supported by economic gains in the market. Building permits data is also expected to increase due to the incoming policies on increased spending in construction.

The coming week would see whether the interest rate would increase to 0.75%, as many suggested and forecasted. The likelihood for the first rate hike is at 97.2%. As indicated by the Federal Reserve’s Chairwoman Janet Yellen, the upcoming President’s policy by January does not seem likely to affect their measured view on growth, that is why the interest rate hike would seem to happen. Wednesday would see the FOMC Economic Projections meeting, together with the announcement of the Fed’s decision on interest.

  • Other Markets – The US stock market could be seen having a follow-up improvement for the big-cap stocks while the oil sector could be getting back at rallying on its process. The Euro/USD is moving past its closing figure of up to 1.0870 despite the expected return plummeting down. This currency trade is seen to still be in a bearish mode as the USD might continue to rise in its value. This would entail an international effect on major currencies. It would be deduced that with the upcoming Fed Rate hike, if the USD increases its value, then foreign investments in USD would have to cope with the devaluation that would follow and reduce the equivalent return in terms of the dollar. Canada would also release its manufacturing date and CREA Real Estate Sales figures.

Weekly Market Summary Dec. 14, 2016

This week sees a lot of optimism towards the market as most major economies gained at the end of the week. For the US market, the Trump administration is undeniably pushing an uptick in the market as reflected on Russell 2000, which sets a record high performance index. Again, Trump’s administration aims to reduce taxes while increasing the spending in infrastructure to bring in more jobs and outflows in the economy. The US market also reflected a positive job employment report, including low figures for unemployment benefit seekers and a slight discrepancy over the job openings offered to workers. Good news is coming in for the energy and oil sector. Demand is increasing, as well as prospect of more investors. This would lead to more trading in the sector.

Moving to the European market, the European Central Bank’s announcement to retain the current interest corridor pushed the record high for the US market last Thursday. They would also be reducing the asset buyout month from 80 billion to 60 billion Euros per month. Its president, Mario Draghi, indicated that the program to boost the economy of Eurozone would continue until it reached the target inflation rate of 2%. Italy is taking measures to do something regarding their banking sector problems, which lead to its uncertainty in the country’s market outlook. Prime Minister Matteo resigned over the rejection of the plan to reform the constitution, which raises the question on what would be next for the country. Eurozone countries (France, Spain, Germany and Italy) showed a strong business outlook, although still far from resulting in a significant move to push to the target inflation rate of 2%.

The Asian market also registered closing on a positive note. Japan is gaining on the market despite its yen still being weaker than the US dollar. China’s trade policy is still looking for how Trump’s policy would affect its own due to impending restraints on foreign outsourcing by the US. On other markets, Brazil is looking for solutions regarding their fiscal policies. Their state-controlled oil and gas sectors would hike prices for its product after a price increase in the global market.

 Stock Overview

Dow Jones; 19,757 (+3.1%), S&P 500; 2,260 (+3.1%), and NASDAQ; 5,444 (+3.6%) all had a record high close for the trading week despite bonds still lagging in the week because of interest rates rising. Russell 2000, which performed best this week, closed at 1,388.07 (+5.6%).

On the global market side, Japan’s Nikkei 225 closed at 18,996.37 (+1.23%), Stoxx Europe 600 at 355.38 (+0.97%) while UK’s FTSE 100 closed at 6,954.21 (+0.33%).

Currencies

The major exchange rate has a mixed result for this trading week. The Euro/USD closed at 1.0563 down 0.0054 while the USD and the Japanese Yen was up 1.32 to a close of 115.36. The Sterling is down by 0.0012, closing at 1.2573, while the AUD and USD is also down by 0.0013, with a close of 0.7449.

Commodities

Oil is gaining its momentum week per week as crude oil closed at 51.48, up by 1.26% after OPEC’s agreed oil-production cut. On the other hand, gold is down 0.94% with a close of 1,161.40.

 On a Personal Note

As promising as it looks, the Trump administration could bring in more gain in the coming weeks due to its pro-business policies. But do not falter from the long-term goal of investing. Uncertainty is far more uncompromising when you stick to the hype of policies not yet implemented, and looking forward to its positive effect immediately. Always be patient and always take the economy as a whole.

Small cap stocks are performing well, so it is advisable to throw in a mix of middle to small cap. Maintain a balanced portfolio so that in case of drastic changes on one portfolio, you have another that could hold up its value. Never be intimidated by the short-term hype of gains, but look forward to its long-term goal and view.