The Swiss franc stunned the trading world and the shock waves will continue next week
In a week of so much turmoil, there was so much going on for everything – currencies, commodities, stocks and indexes, all included. Oil hasn’t shown solid signs of rebounding and next week will still see it in the spotlight, although stocks and currencies have more or less surpassed it in the last few days.
The standaout event was yesterdays decision of the Swiss National Bank to remove the 1.20 cap on the the Swiss franc’s pairing with the euro which send shockwaves throughout the world. This isn’t an understatement as the currency has been thought of as a safe haven in times of economic turmoil, putting it in one category with gold.
This will prompt increased volatility in currency markets, although a lot has already happened to the EUR/USD against each other and other currencies (the euro is near 1.15 at the moment).
Next week will be vital for the course central banks on both sides of the Atlantic take, with important data and announcements coming from China and Japan. Traders will be jumpy after yesterday and we could see unscheduled announcement from politicians beside the programmed ECB press conference on Thursday. Earnings season will also pick up its pace, so a lot going on right now.
Monday 19.1.15 – Bank holiday for the U.S. for Martin Luther King day, markets there will be closed.
Tuesday 20.1.15 – Markets will kick-off at 2:00am GMT with China releasing several key economic figures, most importantly their trade balance. It will be the first day for the U.S., so all the information that has come over the weekend and Monday will influence movement when they open. Some major companies will be announcing their results then: Johnson and Johnson and Morgan Stanley will give their earnings report before the market opens and IBM, Netflix are scheduled for after the close of trading.
Wednesday 21.1.15 – Three countries will release data. Japan’s central bank will have a press conference at 4:30am GMT, which might provide insight into how they will react to the Swiss National Bank decision. During the day there will also be data from Britain and Canada, shifting focus to their currencies. United Health Company will release their earnings before the trading session and American Express and eBay will follow after the close of the market.
Thursday 22.1.15 – A crucial day for the euro, which has come under some serious fire lately. The ECB will hold a press conference, but this time everyone will be asking about how and when they will react to the continued depreciation of the common currency. Among the companies with earnings reports that day Starbucks and Verizon stand out as the two most important.
Friday 23.1.15 – If there wasn’t so much going on, it could have been a calm day with “only” General Electric and McDonalds issuing reports, but volatility has been heightened for all asset types and it will probably continue to the end of the week.
Here are our reading picks for this weekend, expanding on the major events of the last five days.
What exactly did the Swiss do and how is it affecting everyone – the best explanation is here (Businessweek). We also remembered this article from about six months ago, which explained how the Swiss franc and gold are connected, you can give it a read in hindsight and judge for yourself if it was correct. (Forbes)
With all eyes on Switzerland, we thought it would be interesting to check out a bit more about their famous banks. (HowStuffWorks)
Oil has taken some beating recently, just like this floating oil rig in the North sea (BBC News), but it hasn’t lost the attention of market participants. Here’s a recap of what’s been happening in the last few weeks and where things are headed. (Fool.com)
Also if you’re into documentaries about big structures – here’s one for the largest oil rig in the world. (National Geographic)
The Internet of Things (IoT) has been gathering popularity lately and someone has already been profiting from it. Here is what Intel has been up to in the last year. (The Verge)
Finally we mark the end of Google Glass in its present shape and form as a business, but it might make a comeback. (Wired)