2016-09-14 12:05:18

European stock indices are going down with the opening of today's trading day, following an example of the American indices, which fell at yesterday's closing. Dow Jones Industrial Average index fell by 1.4%, S& P500 by 1.5% and the Nasdaq Composite fell by 1.1%.

Possibility of the interest rate hike by the US Fed next week has provoked a sharp sell US stock indices and government bonds.

Uncertainties, including presidential election in the USA, which will be held in November, possibility of the interest rate hike before the end of the year and the beginning of formal negotiations on the UK exit from the EU cause volatility in the financial markets and trigger sales of the isky assets

Note that gold as a safety-haven asset is also declining. The USD is becoming a favorite asset of the financial market. Earlier in August, chairman of the US Fed, Janet Yellen and vice-chairman, Stanley Fischer, gave to understand that they are ready to raise interest rates in case of the positive economic data. Last Friday, President of Fed Boston Eric Rosengren also said that there were all grounds for monetary policy tightening, which will help avoid overheating of the economy.

European index StoxxEurope600 fell again by 1% continuing the decline of the past three sessions. The index is under pressure from the decline in oil prices and inactivity of the ECB in respect of the QE program in Eurozone.

Last week, the European Central Bank left interest rate unchanged. The deposit rate for commercial banks was also left at the previous level of -0.4%, the key interest rate is 0%. ECB President Mario Draghi did not suggest to introduce any incentives measures for the first time in two years, however, he said that the experts will review QE program, which involves the purchase of assets for the amount of 80 billion Euro per month in order to achieve successful implementation of the program. The ECB has failed to fight off extremely low inflation in Eurozone so far.

European stock index EuroStoxx50 is also declining at the beginning of European session, declining below important support levels of 3010.0 and 2995.0.(see Technical analysis of 14/09/2016)

Today at 12:00 (GMT+3) important European data will be released, such as industrial production output in Eurozone in July, the first month after Brexit. According to the forecast the index will fall by 0.9% on the monthly basis and by 0.7% on the annual basis. Volatility in the market can increase during the period of publication.

EuroStoxx50: Important European data.  Fundamental analysis of 14/09/2016