ActivTrades’ Market Analysts have prepared for LeapRate their daily commentary on traditional markets for October 24, 2019. See details below:
FOREX
Later today Mario Draghi will deliver his last public performance as head of the ECB. Mr Draghi will be remembered for saving the Euro, with his famous ‘whatever it takes’ speech, in 2012. However, today’s speech won’t just be a farewell filled with pleasantries. Many, even ECB insiders, aren’t happy about the latest round of stimulus and rate cuts announced in September so the outgoing President of the European Central Bank will be expected to explain that decision. The tone of his speech will be closely scrutinised, if Mr Draghi paints a dark picture for the Euro economies to justify last month’s actions, then there will be downside risk for the Euro.
Ricardo Evangelista – Senior Analyst, ActivTrades
GOLD
Gold is showing little movement as investors are waiting for the final ECB meeting with Mario Draghi, which anyway seems likely not to give many further information. In this scenario EURUSD is stable and a similar scenario is seen on bullion, where the first key level remains $1,500. The movement seen in the last few weeks, with prices playing a slow dance just below $1,500, could be seen as a consolidation phase after the impressive rally seen in the first part of the year.
Carlo Alberto De Casa – Chief analyst, ActivTrades
OIL
Markets are still digesting yesterday’s surprising news that US crude oil inventories have fallen by around 1.7 million barrels, pulling up the price of black gold. WTI is consolidating above $55 and is trying to recover strength after the decline seen in the last few weeks amid fears of an economic slowdown. Markets are now waiting for the ECB decision today and the Fed’s later this month, when another 0.25% rate cut is widely expected.
Carlo Alberto De Casa – Chief analyst, ActivTrades
EUROPEAN SHARES
European stocks are trading higher everywhere in Europe on Thursday, from Madrid to London, continuing the bullish trend started overnight in Asia. Investors’ trading mind has changed a lot since yesterday after a slew of big companies around the world beat estimates in their Q3 earnings, erasing concerns about slower global growth. Approximately 80% of S&P500 listed companies have beaten market expectation so far and traders also welcomed the fact that geopolitical tensions with Turkey were easing after President Erdogan told Washington he will make the current ceasefire permanent. Today’s bullish movements may also be boosted by investors’ anticipation of further stimulus from today’s ECB meeting.
Traders buying stocks may want to take profit at the time of the ECB Press conference which could spark volatility spikes as well as a “buy the rumour, sell the news” phenomenon on EU assets.
Today will see another bunch of Q3 results with tech giants like Twitter and Amazon as well as important French companies like Dassault, Hermes, Peugeot, Saint Gobain and Michelin, which is likely to have an impact on the CAC-40 Index in Paris.
Pierre Veyret– Technical analyst, ActivTrades
DAX/ GERMAN SHARES
Despite this morning’s disappointing PMI release (48.6 vs 48.8 expected) adding to this month’s employment decline, the DAX-30 index keeps on trading higher. Market sentiment seems to be boosted by both potential fiscal stimulus from the Government as well as good Q3 performances reported by German companies.
DAIMLER beat estimates as its cost-cutting plans are finally paying off and reassuring investors while BASF also reported better-than-expected results.
All eyes are now on Mario Draghi’s last policy meeting where many German stocks investors are expecting more measures to sustain the economy, especially after hopes for a return to growth for the end of the year in Germany declined following this month’s disappointing data.
The market went back to the 12,830pts level this morning after many bear traders defended the strong psychological and technical 12,900pts zone. Next supports can be found towards 12,790pts and 12,645pts.
DAX-30 index
Pierre Veyret– Technical analyst, ActivTrades