Friday November 13, 2009 - 03:51:30 GMT
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FX Thoughts for the Day - www.fxthoughts.com
Morning Briefing : 13-Nov-2009 - 0340 GMT
The Dow (10197.47) and the Nasdaq (2149.02) corrected 0.91% and 0.83% respectively yesterday after the piling crude inventories showed falling energy demand. The stocks rose intially on HP's acquisition of 3Com Corp and fell later on slowing US energy demand. After the close of the markets, Walt Disney announced an 18% jump in quarterly profits. Walmart's numbers came in better than street expectations and is seen as an indicator to trends in consumer spending.
Most of the Asian indices are trading half a percentage lower. The Nikkei (9752.13) is down 0.53% and the Shanghai (3153.76) is down 0.60%. The Sensex (16696.03) had corrected 1% yesterday after surging 2.5% a day before. Upside towards 17300 may be seen over the next few days. The markets have shrugged off good IIP numbers yesterday. It had shown a growth of 9.1% in September Y-o-Y.
Crude (76.72) fell sharply breaking below the Support at 77 mentioned earlier as the US Crude inventory data released yesterday showed an increase of 1.8 million barrels. If it continues to trade below 77 we might see further dip towards 75.50-00 in the coming days. However, a strong break above 77 might take it up once again towards 80.
Gold (1106.60) fell sharply yesterday as dollar strengthened. Support is seen at 1090 which we expect to hold as the overall picture continue to remain bullish for a target of 1150-1200. However, a strong break below 1090 might pull it down towards 1070-60.
Good surge in the Dollar overnight on Geithner's renewed "commitment" to a "strong Dollar policy". Is it just profit-taking, or is it a trend reveral? That's the debate in front of the market just now. The outcome may be known only after a few days.
The Euro (1.4870) may dip a little more towards 1.4800, while the Aussie (0.9260) has Support near 0.9200-9185. Dollar-Yen (90.22) had surged to 90.62 yesterday, coming up from 89.65. Suggests the Support at 89 is likely to hold for some days. The Euro-Yen Cross (134.13) continues to oscillate between 133.80-135.40. The Pound (1.6605) has recovered a bit from yesterday's low near 1.6515 after having dived the day before. Dollar-Swiss (1.0160) surged to 1.0195 yesterday and might move further up to 1.0235 today.
Among the Asians, the Sing Dollar (1.3895) has lost some ground with the USD finding Support near 1.3835. The Korean Won (1160.60) has also weakened a bit from yesterday's level near 1153-54. Dollar-Rupee had closed near 46.65 yesterday and might rise towards 46.70-80 today.
3M USD LIBOR was unchanged at 0.27%. The yields on US Treasuries have fallen between 3-5 bps for maturities over 2Y. The 2Y and 10Y benchmark yields were quoting at 0.82% and 4.38% respectively.
10:00 GMT EU GDP Q3 '09 (Adv)
...Expected 0.6%...Previous -0.2%
01:30 GMT US Sep Trade Balance
...Expected $ -32.0 Bln $...Previous -30.7 Bln
Australia Labour Force
...Actual 24.5K...Previous 39.8K
EU Oct IND Prodn (MoM)
...Actual 0.3%...Previous 1.2%
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