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S&P500: the eve of important events _15/06/2016

Technical analysis and trading recommendations -

The uncertainty of this week's events associated with meetings of the three key central banks (US, UK, Japan), as well as conflicting reports about the state of the world economy, along with the forthcoming referendum on membership of the United Kingdom to the EU, increasing the demand for safe-haven assets and out of riskier assets.

At the end of the trading day Tuesday, the index Dow Jones Industrial Average fell 0.3% to 17,674.82 points, S & P500 - 0.2% to 2075.32 points, Nasdaq Composite - by 0.1% to 4843.55 points. The fall are shares of financial companies.

The S & P500 declined on Tuesday, the fourth consecutive session, which was the most serious since February. Reduced prices of oil, which has been observed for the fourth consecutive session, also leads to a decrease in the value of shares of US oil companies included in the index. August Brent crude on London's ICE Futures exchange in London were down in price up to 49.07 dollars per barrel, the lowest level since the beginning of June.

Spot gold price in June increased by 70 dollars to 1285.00 dollars an ounce, seeking almost recoilless growth to the recent highs near the mark of 1300.00.
The increased demand for government bonds leads to a decrease in their profitability. The yield on 10-year US Treasury bond fell to 1.611% from 1.616% on Monday, the yield on 10-year government bonds in Germany for the first time fell below zero (up to -0.027%).

On the eve of the upcoming important events, investors are cautious and prefer gold, the yen, the dollar and government bonds as safe assets. Today (18:00 GMT) is scheduled publication of the Fed decision on interest rates in the United States. As expected by most market participants, the rate will remain unchanged at 0.5%. US stocks decline for several consecutive sessions. But more significantly drop in European indices. StoxxEurope600 lost 1.9%, and over the last five sessions of its drop was 7.4%.

A possible Brexit of the UK could provoke a long period of uncertainty for European assets. The weak recovery of the Eurozone economy will be undermined.

Apparently, the global financial markets and stocks will be under the pressure of negative investor sentiment until the outcome of the upcoming events in June.

Wednesday, 15 Jun, 2016 / 11:10

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