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    SPX: “bearish” trend dominates despite correction on 25.02.2016

    International Monetary Fund stated yesterday that the world economy is very vulnerable now due to turbulence and instability in the financial markets, slowdown of the Chinese economy, decline in prices of oil and commodities. According to IMF, governments of the countries with the strongest economies shall agree on the coordinated measures to prevent further decline in the world economy.
    At the end of this week heads of the financial departments of the Bid 20 will gather in Shanghai. IMF is going to urge the countries of G20 to agree to assume obligations in order to increase public expenditures thus, avoiding risk of further deterioration of the world economy.

    Note also, that this morning President of St Louis Fed James Bullard said that US Fed can revise plans to increase interest rates in the USA. Minutes of FOMC meeting showed that not all executives of the US Fed think that the rise in the interest rate is required this year due to instability in the markers and growing risks of the foreign economies.
    Despite the rise in jabs, inflation expectations in the USA are decreasing and inflation remains significantly lower than the target level of 2%.
    Some negative US data has been released. Earlier this week, it became known that business activity index (PMI) in the main sectors of the US economy is decreasing. PMI in the manufacturing sector of Richmond in February was -4 against the forecast and the value of January of 2. Preliminary PMI in the service sector fell in February (49.8 against 53.2 in January), showing decline in activity. World stock indices are also declining. During the Asian session Chinese index Shenzhen Composite Index fell by 7.3%; Shanghai Composite Index - by 6.4%, Japanese Nikkey fell below 16000, American S&P500, opened up today after yesterday’s rise of oil prices; however by the opening of European session it went back to yesterday’s closing level. Spot price at the end of the Asian session exceeded the level of 1240 USD per ounce.
    Fundamental data shows that the world financial market is far from being stable; therefore “bearish” trend dominates.


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