20131115

Good morning,

Global markets were positive ahead of the last trading day of the week on back of a continued accommodative stance from the Federal Reserve to aid the US economy as good as possible in order to boost growth and job creation. In Europe, the indices closed in positive despite growth figures being a tad soft. DAX is closing in on the all-time highs and the S&P500 is heading for 1800. In Asia, the Nikkei is up 2% in time of writing on back of speculation that China will change economic policy in order to keep the wheels turning for the Chinese economy. The risk-on environment sent the US Dollar on the offer along with the JPY. EUR/USD experienced its third positive day in a row, but has sold off somewhat overnight, being in between the 50- and 100-day SMAs, currently trading at 1.3450-area.

Today, markets will be focusing on any news from the ECOFIN meeting regarding the 2014 draft budget and discussions on the banking union for the Euro zone. On the macro side, the final October inflation figures for the Euro zone could be interesting. However, we believe that market volatility will pick up when the US session is started as we have Import Prices as well as the Empire State Manufacturing Index. Later, the US Industrial Production will be interesting and could cause volatility to pick up, especially if the figures are better than expected. In light of Yellen's statement yesterday, which was supportive for the US economy, the big question is when the Fed can start the tapering...

Have a nice weekend!