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    Dollar freezed growth this week

    After three consequent loss-making days American indices dropped yesterday due to negative quarterly reports by Caterpillar and American Express. The companies lost 3.6% and 2.5% respectively, while 3M Corporation cut sales forecast by 3.8%. No important macroeconomic news was released yesterday but we would like to point out that Weekly Unemployment turned out to be better-than-expected. Amazon and Visa gained 18% and 7% in after-hours trading after publishing good corporate reports. American indices futures are in the green zone. Some market participants say that American stocks are relatively overvalued now. The average P/E (current price/annual earnings) ratio is 16.9 for S&P 500 companies, meaning that the price of a share is 16.9 as big as the annual earnings of a company, divided by the number of shares. Meanwhile, the 10-year ratio equals 14.7. On Thursday the American stocks turnover was 8% above the monthly average, making 7bln shares. New Home Sales will be released today at 16:00 CET. The tentative outlook is neutral.

    US ICE Dollar Index stopped growing due to the Greek deal and the strengthening euro. Currency traders may have decided to take a break. There was no important macroeconomic news from the USA, however, next week investors expect a number of significant events, including a regular FRS meeting and the second quarter GDP release.

    The euro slipped this morning due to weak July PMI in Germany. European indices that have been retreating for almost a week are climbing, underpinned by neutral corporate reports. SES mobile operator cut the current year financial forecast, so its shares lost 8%. BASF, the world's largest chemical company, published a negative quarterly report and retreated 4.1%. Meanwhile, Vodafone, Air France-KLM and French industrial group Thales supported the stock market, earning 3.1%, 2.6% and 8% respectively. The European reports are not very bright in general. About 18% of companies submitted their data by now; only 1/3 of them outstripped forecast, while 2/3 did not meet expectations. No important macroeconomic statistics are expected today in the EU.


    Nikkei has been pulling back together with other global indices. It was also driven down by slumpy Chinese Industrial PMI, released this morning. The yen has been traded in a range. We believe it stabilized due to good foreign trade statistics. Analysts expected a Trade Balance surplus, but it did not happen. Yet, the Trade Balance deficit has shown a steep decrease as compared to May. We remind that we observed the Trade Balance surplus only once in three years – in March, 2015. Important macroeconomic statistics will be announced in Japan only on Wednesday.


    Grain futures tumbled because of good weather in US. Some investors say it is “perfect” for record crops. The weekly drop in corn prices may be the sharpest since last July, while wheat futures may fall to their lowest since May, 2015. US Department of Agriculture reported that the country exported 223.4 thousand tons of corn last week. This is both below investors expectations and the minimum since September 2014.


    Sugar price has been growing for 2 consequent days. Brazilian industrial group Unica informed that due to rains sugar production in early July contracted 40% as compared to June. According to the forecast, the production will decrease17% by the end of the month and 6% by the end of the season.

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