Wednesday December 2, 2009 - 03:34:41 GMT
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FX Thoughts for the Day - www.fxthoughts.com
Morning Briefing : 02-Dec-2009 - 0333 GMT
The American equities have risen yesterday. The Dow (10471.58) rose 1.23% and the Nasdaq (2175.81) rose 1.46%. Dow has Resistance near 10500-10600. Over the last couple of weeks, the index has been trading between 10250-10500. We shall have to see if this range continues going forward. The US ISM numbers have not been very encouraging, though it is still above 50 which signals growth.
The Asian indices are trading higher as well. The Shanghai (3262.88), Hang Seng (22417.90) and All Ordinaries (4779.90) are up 0.85%, 1.35% and 0.98% respectively. The Nikkei had risen 2.43% yesterday and is trading flattish at 9556.02 today. The Sensex (17198.27), too, had surged another 1.6% yesterday after strong November Auto Sales numbers. If the Resistance at 17400 on Sensex is surpassed, Indian stocks might move even higher targeting 18500 on Sensex.
Crude (78.13) is continuing its upmove taking support from the weaker dollar. The easing of the Dubai situation and the strong manufacturing data from China also helped in the rise yesterday. We may see a rise towards 79.50 in the coming days where some Resistance is seen.
Gold (1207.20) has risen sharply yesterday breaking above 1200 and is now trading higher as the dollar continues to weaken. We may expect it to test the Resistance at 1220 in the coming days. On the downside Support is seen in 1165-60 region.
The Euro (1.5087) is keeping up its strength on its upmove. With intraday Support in 1.5020-00 region, we may expect a rise towards 1.5200 in the coming days. Dollar-Yen (86.92) is looking mixed and might test the Resistance at 87.60 today. Euro-Yen (131.21) Cross might see a rise towards 132.00-30 today. Support is seen in 130.60-40 region for the Cross.
The Pound (1.6617) tested the Resistance at 1.6650 yesterday and is now trading slightly lower. A break above this Resistance might see 1.6750 on the upside today. Support is seen in 1.6480-50 region. Swiss (0.9980) is keeping the overall downtrend intact and we might see further dip towards 0.9875-50 over the next few days. Aussie (0.9276) has risen sharply yesterday and has eased the threat of the Trend reversal and might see a rise towards 0.9330-50 today. Support is seen in the broad 0.9220-0.9180 region.
The intervention of the Korean Bank is restricting the Korean-Won (1184) appreciating further. Dollar-Ruppee has closed at 46.31/32 yesterday and the 1-month and 1-week NDF are quoting at 46.20/25 and 46.15/21 respectively.
3M USD LIBOR was unchanged at 0.26%. The yields for the farther end of the curve rose after falling continuously over the last 3-4 days. The yields on 2Y and 10Y benchmark Treasury notes rose 1 bp and 8 bps respectively to be quoted at 0.67% and 3.28% respectively.
In its emergency meeting yesterday, the Bank of Japan had kept the interest rates unchanged and has voiced its intentions of bringing the long term interest rates lower. Yesterday, the Reserve Bank of Australia had increased its benchmark interest for the third time in a row. It increased rates by 25 bps to 3.75%.
AUD RBA Interest Rate
...Actual 3.75%...Previous 3.50%
...Actual 0.3%...Previous -0.3%
...Actual 9.8%...Previous 9.8%
US Manufacturing ISM
...Actual 53.6...Previous 55.7
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