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Market Sentiment


US dollar short bets rose last week to $22.02 billion from $20.06 billion against the major currencies during the previous week, according to the report of the Commodity Futures Trading Commission (CFTC) covering data up to August 7 released on Friday August 10. The dollar started strengthening as the Federal Reserve left interest rates unchanged but signaled a rate increase in September and solid July jobs report signaled economic health persists.

1. Hertz Global Holdings – stocks of the US car rental company rose after the publication of positive earnings reports for the 2nd quarter of the current year. It managed to reduce losses and increase revenue by 7.4%.

US dollar short bets fell slightly last week to $20.06 billion from $20.39 billion against the major currencies during the previous week, according to the report of the Commodity Futures Trading Commission (CFTC) covering data up to July 31 released on Friday August 3. The dollar slipped as the US second quarter GDP came in at 4.1% annual rate, 0.1 percentage point short of the expected growth rate, while durable goods orders resumed growing in June.

1. Deutsche Lufthansa AG – shares of the German airline increased due to good earnings reports for the 2nd quarter of the current year. It managed to make a profit after the loss in the first quarter.

The Bank of Japan, the US Fed and the Bank of England will hold the next meetings this Tuesday, Wednesday and Thursday. According to market participants, only the Bank of England can really raise the rate from 0.5% to 0.75%. As it is expected, the Bank of Japan may announce some measures to tighten its monetary policy. In particular, plans to reduce the yen issue volume, directed asset redemption and stimulation of the economy. The possible Fed statements are the main intrigue of the Forex market. Earlier, representatives of the US regulator announced plans to continue the rate hike policy. However, recently, US President Donald Trump criticized it, noting that strengthening of the US dollar deprives the US economy of competitive advantages. On Monday, the US dollar index slightly decreased. It has been traded in a narrow range of 94-95.6 points for the 6 consecutive week.

1. ThyssenKrupp – stocks of the German steel company rose due to a good forecast by the financial company Kepler Cheuvreux, and an increase in the target level of their prices from 26 euros to 35 euros. The change in the forecast was made after the resignation of ThyssenKrupp CEO and plans to establish a joint company with Indian Tata Steel Ltd.

US President Donald Trump in an interview with CNBC said that he does not approve Fed policy. In his opinion, the rate hike and strengthening of the US dollar puts the US economy at a disadvantage and deprives it of a competitive benefit. At the same time, central banks of other countries support a loose monetary policy. Fed representatives noted that the President cannot affect the decisions of the directors of the Federal Reserve, but the US dollar index has slightly decreased according to the results of the week. According to the US Commodity Futures Trading Commission (CFTC), the net volume of long positions in US dollars has increased for the fifth consecutive week and reached the high since March 2017. Thus, market participants still believe in the further rate hike.

1. Sharp Corp – stocks of the corporation engaged in the production of electronics rose after the cancellation of the additional issue in the amount of 226 billion yen in early July. Now its shares have increased together with the American high-tech companies, as well as amid the weakening of the yen.

Investors are waiting for information on the further Fed rate hike. Amid this, the US dollar index is traded in a narrow range for the 8th week in a row.

1. Biogen Inc. – stock prices of the biopharmaceutical company have risen due to a report on the successful testing of a new drug against Alzheimer's disease.