4 lessons for investors on the example of Warren Buffett's portfolio (1)

On Saturday, Warren Buffett, the head of the investment holding company Berkshire Hathaway ((NYSE: BRKa) and (NYSE: BRKb)) and one of the most touted and successful investors of the XXI century, published eagerly anticipated annual address to shareholders.
 Currently, the market capitalization of the company Berkshire Hathaway, which was originally engaged in textiles, and now is a holding company that operates in the finance and insurance sector for accidents, worth $416 billion. Buffett's personal assets are estimated at more than $75 billion, making it one of the most richest people in the world.
Published on the last Saturday of February or the first Saturday of March annually message from Buffett to shareholders is an important event for the market. These letters, written in typical laid-back Buffett's style, are read by all those interested in shares, investments or business in general.
Usually Buffett gives an overview of the various businesses, owned by Berkshire, he is making a deep overview of investments of the holding and uses this platform as a way to share his opinion on all financial issues. This year, in a letter written in simple language with a fair amount of humor, Buffett expresses his thoughts about the repurchase of shares, income on the "corrected» GAAP standards and hedge funds. And once again he confirms his faith in America, in spite of the recent political changes. As in previous years, this is a very fascinating read.

Dollar declines in anticipation of the promised by Trump incentives

Dollar drops slightly on Tuesday as investors took a wait on the eve of the US president's speech in Congress.
By 11.48 GMT the dollar index slowed down by 0.01 percent to 101.120 against a basket of major currencies after a modest growth in the previous day.
The US currency strengthened after Trump called for a "historic" increase in military spending, which improved appetite of dollar "bulls" before the speech of the American president in Congress.
Dollar Index reached a peak of 14 years shortly after Trump won in the November election against the backdrop of expectations that he will present an ambitious program of fiscal stimulus.
However, the US currency has recently gave up positions, as the administration of Trump has not explained the details of the plans, particularly those regarding tax reform, so the focus has shifted to the President's appearance before the Congress.
Dollar slowed down by 0.15 percent against the yen to 112.50 yen.
The euro gained 0.06 percent against the dollar to $1.0590, moving away from the week peak of $1.0631 reached the previous day.

Dollar: the announcement of the events for February 27 - March 3 (2)

Next week, the focus of the global financial markets will be on the speech of the US president Donald Trump to Congress, which will take place on Tuesday. Market players expect to get more information about tax reform, deregulation of the economy and spending on infrastructure projects.
For the next week are also planned several speeches of the leaders of the Federal Reserve System. The most important will be the speech of the Fed's chairman Janet Yellen on Friday.
In addition, the attention of market players will be attracted by the a revised value of US gross domestic product for the fourth quarter, which will assess the state of the US economy. The UK will publish data on business activity in the private sector, and the focus in the euro area will be inflation data.

Dollar: the announcement of the events for February 27 - March 3 (1)

On Friday, the dollar rose against the basket of other major currencies despite weak sales data for the US homes. Investors expect the US president's speech.
The US Dollar Index, which shows the value of the dollar to a trade-weighted basket of six major currencies, by the end of the trading session rose by 0.17% to 100.12. For the week, it rose by 0.14%.
On Thursday, US Treasury Secretary Steven Mnuchin said that he would like to hold a large-scale tax reform through Congress before the holidays in August, but there is still a lot of work.
According to published on Wednesday minutes of the last FOMC Committee meeting, the Fed's management considers pretty soon to raise interest rates if the economy will develop in line with expectations.
However, the published protocol also listed the Fed's uncertainty about future economic policies of Trump and pointed to the risk of strengthening of the dollar.

Bitcoin rose to a historic high

Bitcoin exchange rate reached a record high on Friday amid expectations that the Securities and Exchange Commission (SEC) may approve American Bitcoin digital currency fund, which will increase the attractiveness of Bitcoin for institutional investors.
According to the indicator CoinDesk Bitcoin Price Index, which is the average value of Bitcoins course on major exchanges, cryptocurrency went up to a maximum of $1206.60. The previous record was set in November 2013, and was $1165.89.
On the New York Stock Exchange itBit Bitcoin has risen in price by 0.03% to $1187.82, retrieving from session high at $1215.93.
In other major markets, such as Bitfinex, Kraken and BitStamp, trading in cryptocurrency demonstrated mixed dynamics.
The maximum rate of the digital currency is linked with the rumors that the Securities and Exchange Commission (SEC) will allow the launch of at least one of the three proposed Bitcoin funds.

The dollar fell to a week minimum

On Friday, the dollar fell against other major currencies to a week minimum. Investors continue to evaluate the minutes of the last FOMC meeting committee.
EUR/USD exchange rate rose by 0.27% to 1.0609, which is the highest since Tuesday.
Posted on Wednesday, January FOMC meeting minutes showed the committee that the Fed leadership is considering an early interest rate increase.
However, the same report indicated the US central bank's uncertainty about the economic program of Trump administration. This reduces the demand for the dollar.
The dollar also came under pressure due to published on Thursday the United States report of the Ministry of Labour in which it is said that last week the number of initial claims for benefits for unemployment in the US increased by 6 thousand to 244 thousand. Analysts expected an increase in the last week of the number of applications for unemployment by 2 thousand to 241 thousand.

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Strengthening of the yen and gold indicates a risk

On the last trading day of the week the dollar shifted into recovery mode after the recent sales. Currency steadily strengthened against major currencies, but lost ground against the yen.
Despite the return of interest in the dollar, quotation continued to retreat, trading at weekly lows at 113.00 mark. The purchase of yen, which is actively growing in the dollar and the euro, suggests that markets do not forget about the political risks in the global arena, while on the stock markets at the same time signs of panic is not observed. For the concerns of investors signals an increased demand for gold, which is also a traditional safe haven. Metal is continuously going up already 4 day in a row, trading in the area of 1243.
In the US there are doubts that Trump will be opposed by some Republicans in an attempt to tax reform. Also, the players do not forget about the protectionist policies of the new president, fearing from new attacks on China, Japan, Germany and other countries. In Europe, the main risks are concentrated on the topic of elections, where there is a strength of anti-European sentiment, forming a threat to Europe's disintegration.
In the light of all these fears, the long-term prospects for safe assets look favorable. In bursts of optimism yen and gold will show temporary setbacks, which will then be replaced with new turns of purchases. Against this background, in mid-term USD/JPY could easily lose 111.00 level and reach 110.00.

GBP/USD may continue to decline

Sterling in tandem with the US dollar keeps negatively. The price chart has tested the support level in the area of ​​$ 1.2414. It is known that the index of retail sales came out worse than forecast, and thus disappointed the market participants.
It also shows that the price schedule is kept above the level of support and hints at the closing of short positions. If this trend will continue, it is still possible to prevent the purchase as part of speculative trading.
It is important to note that in the middle of next week's FOMC will held publication of the report. If the US dollar against the backdrop of this event will be strengthened, the sterling may continue the downward trend.

The dollar rose to a new wave of optimism

The dollar rose against other major currencies on Friday, recovering from the fall of the previous session to a minimum for the week. Strengthening of course is due to the wave of optimism about the economic situation in the US and more likely interest rate increase in March.
The dollar retains support after a report on Tuesday of Janet Yellen before the US Senate Banking Committee, in which she pointed out that the US central bank will raise the interest rate on one of the following of its meetings.
Yellen said that waiting too long before raising interest rates would be unreasonable under the condition of economic growth and increasing inflation.
In addition, the strengthening of the dollar was due to the positive US statistics on the number of initial applications for unemployment benefits and the number of construction permits.
EUR/USD slipped by 0.22% to 1.0650, down from 1.0682 week high.
The pair GBP/USD fell by 0.52% to 1.2425 after a report in the National Statistical Service of the UK (ONS) said that in January, the volume of retail sales decreased by 0.3% compared with growth forecast for 0,9%.
USD/JPY dipped by 0.43% to 112.75, and USD/CHF rate rose by 0.13% to 0.9984.

Wall Street continues to believe Trump on tax relief

Fed Chairman Janet Yellen dismissed the possibility the central bank to respond with increases in interest rates at each change of tax and spending plans of President Donald Trump. She stated that such changes will be made only if based on demand and inflation targets are under threat.

Fed Chairman in Boston Eric Rosengren said the central bank may need to raise interest rates more aggressively than predicted three changes for this year. He added that he expects the least implementation of the forecasts from December, which were for three increases in interest rates in each of the next three years. According to Rosengren GDP will be higher as unemployment has fallen below equilibrium levels.

Philadelphia Fed Chairman Patrick Harker reiterated that he expects the Fed to continue with interest rate hikes. According to him, there will be three changes this year. When achieved targets for employment and inflation are almost reached, the question that will excite the Fed will continuing of the economic growth.

Bond yields in the US increased again over the entire curve because of the good economic data and speeches by Fed officials that increased bets on markets raise rates in March. Yields on 10-year bonds is now near the highest levels of close of 2017.

Petrol: Exports from the US is on 23-year high

The United States, a key consumer of oil, surely climb up the world rankings in terms of its largest exporters. According to the latest data last week, the country exported 1.03 million barrels per day of crude oil, which is a record high for the past 23 years. The average volume of exports during the first six weeks of 2017 amounted to 695,000 barrels per day against 450,000 during the same period last year.

US production is increasing, and demand is still low due to the fact that many processing plants were closed for maintenance, analysts say. Oil available for export, since the agreement of OPEC reduces supply of black gold, they added. In December 2015 the United States had canceled a law that did not allow to do so.

According to forecasts of experts, this year the average volume of exports of crude oil in the US will be 650,000 to 800,000 barrels per day, which is higher than production in December of OPEC members such as Libya, Qatar, Ecuador and Gabon.

The dollar rose to 2-week high (Part 2)

GBP/USD exchange rate decreased by 0.27% to 1.2484.
National Statistical Service of the UK (ONS) on Friday reported an increase in production in the UK manufacturing industry by 2.1% in December against the forecast for increase by 0.5%. Compared with the same period last year, the volume of production in the UK manufacturing grew by 4.0% in December.
The report also stated that the UK industrial production rose by 1.1% in December against an expected rise of 0.2%.
According to the report, the UK trade balance deficit in December narrowed to £10.89 billion, compared to £11.56 billion on November (originally defined value in November was £12,16 billion). Analysts had expected, that the UK trade balance deficit in December was £11,50.
Currency pair USD/JPY rose by 0.17% to 113.45 - the highest value since February 1, and the USD/CHF fell by 0.19% to 1.0036.

The dollar rose to 2-week high (Part 1)

The dollar rose to a 2-week high against other major currencies against the background of recent statements by US President Donald Trump.
EUR/USD is down by 0.28% from 1.0707, updating 2-week low at 1.0629.
The dollar strengthened after the announcement of the president of the USA Donald Trump on Thursday that after a few weeks, he is going to reveal the plan for the most ambitious tax reform since the Reagan era.
Euro remains under pressure due to the fact that the results of the upcoming elections in France can become as shocking as the UK out of the EU or a victory of Trump.
A cause for concern in the euro zone can also become the upcoming elections in the Netherlands, Germany and possibly Italy and the conflict over financial aid to Greece.

Kiwi's knocked down

The dynamics of the pair NZD/USD yesterday was correctly interpreted as preparation for a serious fall. Even in periods of retreat of the US dollar, the pair stayed in range, but comments from RBNZ that the currency is still overvalued, called major selling of the kiwi. As a result, there was a drop of more than a figure to the region of 0.72. It is very likely that this is not the ultimate goal of the bears, and they will decide a new attack as soon as the market is slightly offset short-term oversale.

Indecisive EUR/USD

EUR/USD fell to 1.0640 yesterday, but then again rose back to 1.07 to the levels of the beginning of the day. This does not change the situation: the trend of growth of the pair is broken. At the same time, the question remains, when will come the impulse to reduce. Surely, bears feel the strength after taking support at 1.0620. Today there aren't scheduled publication of important statistics, so the data is unlikely to be a driver for the dollar. Markets will continue to be ruled by the positioning and reaction to companies statistics.

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The business activity in the Eurozone in January has stabilized

In January the business activity in the private sector of the Eurozone maintains solid pace of growth since the end of 2016. These are the final results of agency Markit's research.
PMI index, which measures general business activity, remained in December at level of 54.4 points, holding for a second consecutive month in five and a half years peak against the forecast for a slight decrease to 54.3 points. Thus, the business activity remains in the expansion for 43 consecutive months.
PMI index, which measures only the activity in the services sector also stabilized in January at the December level of 53.7 points. Earlier this week Markit agency reported good growth in industrial PMI index in January to 69 month high of 55.2 points compared to 54.9 points a month earlier.
Latest PMI data meet the GDP growth of the euro area by 0.4% q/q, suggesting that the region's economy is on a solid foundation in early 2017, analysts say. At the same time, faster growth of new business and the upturn in business confidence for the last 12 months to the highest level since the eurozone debt crisis is a good sign that a relatively good pace of growth will persist in the coming months.

The dollar lost positions

The dollar has reduced its growth against other major currencies on Friday after the publication of mixed data on US employment.
According to the report of the US Department of Labor the number of employees outside the agricultural sector in January increased by 227 thousand compared with the forecast of 175 thousand. In December, the revised number of people employed outside the agricultural sector amounted to 157 thousand (initial value - 156 thousand).
However, the same report showed that the US unemployment rate in January rose to 4.8% after the value of 4.7% in December. Analysts did not expected an increase in the unemployment rate in January.
The average hourly wage in the United States increased by 0.1% instead of the expected increase of 0.3%.
In recent weeks, the dollar remained under pressure against the background of the protectionist policy of US President Donald Trump and the ban on the entry of immigrants, which led to the general instability in global markets.
EUR/USD has remained stable closing the week at 1.0783, rebounding from a session low 1.0714.
GBP/USD ended lower by 0.30% to 1.2478.