European Market Update: Rising risk appetite characterized stocks with economic optimism everywhere; Timing ripe for effective currency intervention in JPY?
Thursday, December 03, 2009
European Market Update: Rising risk appetite characterized stocks with economic optimism everywhere; Timing ripe for effective currency intervention in JPY?
*** ECONOMIC DATA *** - (FR) French Q3 ILO Unemployment Rate: 9.5% v 9.9%e v 9.5% prior, Mainland Unemployment Rate: 91.% v 9.3%e - (IR) Ireland NCB Services PMI: 46.8 v 47.4 prior - (SP) Spain Nov Services PMI: 46.1 v 47.7 prior - (NV) Netherlands Nov CPI M/M: -0.1% v -0.2%e; Y/Y: 1.0% v 0.9%e - (NV) Netherlands Nov CPI EU Harmonized M/M: -0.1% v -0.2%e; Y/Y: 0.7% v 0.6%e - (IT) Italian Nov PMI Services: 49.8 v 52.2e - (FR) French Nov Final PMI Services: 60.9 v 60.4e; Highest since Oct 2006 - (GE) German Nov Final PMI Services: 51.4 v 51.5e - (EU) Euro-Zone Nov Final PMI Services: 53.0 v 53.2e; PMI Composite: 53.7 v 53.7e - (RU) Russian Gold & Forex Reserves: $449.7B v $443.8B prior - (IC) Iceland Nov Preliminary Trade Balance (ISK): 6.0B v 16.4B prior - (SP) Spain Nov Consumer Confidence: 75.3 v 69.2 prior - (UK) Nov PMI Services: 57.0e v 56.9 prior - (SA) South Africa Nov SACCI Business Confidence: 84.1 v 82.2 prior - (EU) Euro-zone Oct Retail Sales M/M: 0.0% v 0.2%; Y/Y: -1.9% v -2.4%e - (EU) Euro-zone Q3 Prelim GDP Q/Q: 0.4% v 0.4%e; Y/Y: -4.1% v -4.1%e
*** SPEAKERS/FIXED INCOME/FX/COMMODITIES/ERRATUM *** - Equities: Market news flow has picked up sharply into the second half of the week. Equity markets in Europe have put in another strong morning session following a plethora of wide ranging news topics. Ignoring a mixed session in Asia, markets have focuses on announcements from Bank of America [BAC.FR], earnings from Kingfisher [KGF.UK], Siemens [SIE.GE], along with news flows from Peugeot [UG.FR] and VW [VOW.GE]. Bank of America's post market announcement that it would be repaying $45B in TARP funds has bolstered financials across that board, despite a sector downgrade from Goldman Sachs for 2010. UK earnings from Marston's and Kingfisher came in positive and lifted the retail and pub/food names in the UK. Siemens disappointing Q4 net loss (on the back of write-down's in its Nokia/Siemens JV] disappointed markets with the name being one of the only negative movers. In auto's, Peugeot confirmed that it is in talks with Japanese maker Mitsubishi regarding a stake purchase while VW provided a timetable for its stake purchases in Porsche [PAH3.GE]. CFAO [CFAO.FR] IPO'd on the Paris Euronext, marking the largest IPO in France in two years. Swallowing Euro zone and state PMI's, retail sales and GDP figures, data out of Europe has broadly supported equity strength. Trading volumes have returned with both the FTSE100 and DAX trading well ahead of their moving averages.
-In individual equities: Vossloh [VOS.GE]: Guides FY10 Net 81-84M v 86Me, Rev 1.23-1.28B v 1.2Be. || VW [VOW.GE]: CFO: Will acquire 49.9% stake in Porsche in next week -shareholders meeting. || Kingfisher [KGF.UK]: Reports Q3 Rev 2.7B v 2.7Be, LFL Sales +5.7%. || Marston's [MARS.UK]: Reports Prelim FY09 Pretax 70M v 70Me, Rev 645M v 645Me. || Siemens [SIE.GE]: Reports Q4 Net loss 1.1B v gain 581Me, Sector profit 1.9B v 1.6Be, Rev 19.7B v 19.2Be. ||
- Speakers: India Central Bank (RBI) Deputy Gov Thorat: 2010 growth forecast likely to be revised upwards. He noted that the RBI must reassess its policy to balance growth and price stability. Gov't fiscal policies helped to spur economic growth aided by investment. The country's Infrastructure sector showing signs of significant recovery. He commented that the bond yield rise in recent months was due to higher India borrowings but equity markets were indicating a restoration of confidence. Lastly he noted that managing capital inflows to be a challenge looking ahead || Former Japanese Fin Min Tanigaki commented that the Yen appreciation was aided by confusing remarks from the current government. He noted that the Yen rise was aided by suggestions the authorities might tolerate a firmer yen currency. He added that rapid currency price movements that disrupt the economy need a stance that would deliver the necessary message || Japan's MOF's Noda stated that the coalition parties agree that it is not desired to increase debt issuance || Czech Republic Fin Ministry issued an updated bond management strategy. It now sees 2010 gross borrowing requirement at CZK280B compared to CZK269B in 2009. It forecasted 2011 gross borrowing requirement at CZK306B and planned to o sell at least one benchmark Eurobond issue next year. The ministry also noted that it would analyze other foreign-financing alternatives || Norway Stats office forecasted 2010 oil and gas investment at NOK139B from NOK145.4B prior view (2009 level was NOK141B). The Stats office also revised up its growth forecasts and now look for the economy to contract by 1.1% in 2009 and to grow by 1.7% in 2010, versus -1.6% and 1.4%prior views
- Currencies: The USD was softer against the European pairs as the European morning commenced as risk appetite continued to remain buoyant. Japanese Exporter stocks helped propel Nikkei 225 Index higher by almost 4% to approach 10K level. Asian session was marked by a pickup in JPY currency selling amid reports of increased carry trade activity. The USD/JPy approaching the pivotal resistance of 88.00. Dealers did note of Toshin fund related flows as Japan launches a new Rising China Fund Toshin launched today. Lastly a move above 88 might provide an ideal situation for intervention as dealers note that recent rhetoric, lower interest rates, technical overstretch, and market participants positioned long JPY. There was decent demand in the session for year end 92 strike USD calls. - EUR/USD still holding below the upper parameter of 1.5150 in the binary option said to be in effect until Friday. || A gradual climb in dollar funding costs in China and a steady drop in Thai baht onshore forwards seemed to suggest domestic investors in these markets are preparing for an inevitable year-end dollar funding squeeze
- Fixed Income: The interest rate complex has been characterized by sharply higher yields this morning in Europe ahead of a pivotal ECB rate decision. Bear flattening has been the order of the day in Germany (yields on the 2 year Schatz are up some 10bps at 1.34% for two week highs) with anticipation buliding for some form of quasi-tightening from the ECB. The question on traders minds is what form it will take - whether the ECB will decide to add a spread over its 12 month long term repo operation and/or whether it will discontinue those or other liquidity facilities in 2010. A raft of supply has also weighed on German fixed income with Spain selling 3.2B in 2013s while France sold a combined total of 5.4B in BTAN's and OAT's with mixed results. The BoE announced it considering amendments to its corporate bond purchase scheme- that it was considering acting as both a buyer and seller in the markets in order to improve liquidity (and ultimately issuance) in that market. The 10 year Gilt yield us up 6bps at 3.653% while the US 10 year Note yield is up 3bps in overnight trading at 3.34%. | |JP Morgan analyst commented on yield curves noting that recommends positions for steeper Treasuries curves. Believes to sell front end Treasuries on fair value. Recommended buying Italian and Irish Gov't bonds and ended their bet that Greek Gov't bonds would rise. Year-end funding issues had traders focus on some price observations in China. They noted that China's onshore dollar lending rates have gradually crept up. Six-month rates are now quoted at 1.689%, which is 120 basis points above corresponding dollar LIBOR.
- In the papers: UK's Telegraph noted that S&P believes that European companies face $1.5 trillion funding shortfall next year as central banks withdraw emergency stimulus, and spendthrift governments across the world soak up much of the available capital. S&P noted that the shortage of funds will raise borrowing costs for business by an extra 75 basis points, with the risk of a more serious crunch for small companies. "While the worst of the recession may be behind us, the recovery is likely to be extremely shallow,
***Notes: - Rising risk appetite characterized stocks with economic optimism everywhere - Japanese Exporter Stocks propel Nikkei higher by almost 4% to approach 10K - Bank of America plans to repay $45Bo of govt bailout funds. - Bernanke reconfirmation hearing begins - ECB Rate decision but the press conference will be key for details on the ECB exit strategy from special measures.
***Looking Ahead: - (IR) Irish Oct House Prices Y/Y: % v 13.1% prior - 7:45 (EU) ECB Interest Rate decision: Expected to kept interest Rates at 1.00% but exit strategy is key at press conference - 8:30 (US) Q3 Final Nonfarm Productivity: 8.5%e v 9.5% prior, Unit Labor Costs: -4.1%e v -5.2% prior - 8:30 (US) Initial Jobless Claims w/e Nov 28th: 480Ke v 466K prior, Continuing Claims: 5.4Me v 5.423M prior - 8:30 (EU) ECB's Trichet's press conference following rate decision; Key focus on exit strategies - 10:00 (US) Nov ISM Non-Manufacturing Composite: 51.5e v 50.6 prior - 10:00 (TU) Turkey Nov Consumer prices M/M: 1.0%e v 2.4% prior; Y/Y: 5.2%e v 5.1% prior - 10:00 (TU) Turkey Nov Producer prices M/M: 1.0%e v 0.2% prior; Y/Y: 0.5%e v 0.3% prior - 13:00 (MX) Mexico Nov IMEF Non-Manufacturing Index: 53.0e v 52.9 prior; Non-Manufacturing index: 52.5e v 52.2 prior
Legal disclaimer and risk disclosure
All information provided by Trade The News (a product of Trade The News, Inc. "referred to as TTN hereafter") is for informational purposes only. Information provided is not meant as investment advice nor is it a recommendation to Buy or Sell securities. Although information is taken from sources deemed reliable, no guarantees or assurances can be made to the accuracy of any information provided. 1. Information can be inaccurate and/or incomplete 2. Information can be mistakenly re-released or be delayed, 3. Information may be incorrect, misread, misinterpreted or misunderstood 4. Human error is a business risk you are willing to assume 5. Technology can crash or be interrupted without notice 6. Trading decisions are the responsibility of traders, not those providing additional information. Trade The News is not liable (financial and/or non-financial) for any losses that may arise from any information provided by TTN. Trading securities involves a high degree of risk, and financial losses can and do occur on a regular basis and are part of the risk of trading and investing.
Forex Trading News
Daily Forex Market News Forex news reports can be found on the forex research
headlines page below. Here you will find real-time forex market news reports
provided by respected contributors of currency trading information. Daily forex
market news, weekly forex research and monthly forex news features can be found
Forex News Real-time forex market news reports and features providing
other currency trading information can be accessed by clicking on any of the
headlines below. At the top of the forex blog page you will find the latest
forex trading information. Scroll down the page if you are looking for less
recent currency trading information. Scroll to the bottom of fx blog headlines
and click on the link for past reports on forex. Currency world news reports
from previous years can be found on the left sidebar under "FX Archives."
Actionable trading levels delivered to YOUR charts in real-time.
Mon 10 Sep 2018 AA 08:30 GB- GDP, Trade, Output Tue 11 Sep 2018 AA 08:30 GB- Employment Decision A 09:00 DE- ZEW Survey Wed 12 Sep 2018 A 12:30 US- PPI A 14:30 US- EIA Crude A 18:00 US- Beige Book Thu 13 Sep 2018 A 1:30 AU- Employment AA 11:00 GB- Bank of England Decision AA 11:45 EZ- European Central Bank Decision A 12:30 US- Weekly Jobless AA 12:30 US- CPI Fri 14 Sep 2018 A 08:30 GB- GDP AA 12:30 US- Retail Sales A 13:15 US- Industrial Production AA 14:00 US- prelim University of Michigan
John M. Bland, MBA co-founding Partner, Global-View.com
Global-View Affiliate Program
We are starting an affiliate program to market some of our products.
Send me an email if you would be interested or if you know someone who would like to be an affiliate. Generous commissions payout for those accepted.
Put the word "affiliate" in the email subject line.
Veteran FX Trader, Max McKegg, forecasts all the Major currencies and the Australasians; providing Daily and Medium Term Trading forecasts to subscribers, who include large Banks the world over, as well as individual traders in more than 30 different countries.
looking for your first broker or do you need of a new one? There are
more critical things to consider than you might have thought.
We were trading long before there were online brokers. Global-View
has been directly involved with the industry since its infancy. We've
seen everything and are up-to-data with recent regulatory changes.
The Global-View Forex Forum is the hub for currency trading on the web. Founded in 1996, it was the original forex forum and is still the place where forex traders around the globe come 24/7 looking for currency trading ideas, breaking forex news, fx trading rumors, fx flows and more. This is where you can find a full suite of forex trading tools, including a complete fx database, forex chart points, live currency rates, and live fx charts. In addition, there is a forex brokers directory where you can compare forex brokers. There is also a forex brokers hotline where you can ask for help choosing a forex broker that meets your individual fx trading needs. Interact on the same venue to discuss forex trading.
The forex forum is where traders come to discuss the forex market. It is one of the few places where forex traders of all levels of experience, from novice to professionals, interact on the same venue to discuss forex trading. There is also the GVI Forex, which is a private subscription service where professional and experienced currency traders meet in a private forex forum. it is like a virtual forex trading room. This is open to forex traders of all levels of experience to view but only experienced currency tradingprofessionals can post.
Currency trading charts are updated daily using the forex trading ranges posted in the Global-View forex database. You will also find technical indicators on the fx trading charts, e.g. moving averages for currencies such as the EURUSD. This is another forex trading tool provided by Global-View.com.
The forex database can be used to access high, low, close daily forex ranges for key currency pairs, such as the EURUSD, USDJPY, USDCHF, GBPUSD, USDCAD, AUD, NZD and major crosses, including EURJPY, EURGBP, EURCHF, GBPJPY, GBPCHF and CHFJPY. Data for these currency trading pairs dating back to January 1, 1999 can be downloaded to an Excel spreadsheet.
Forex chart points are in a currency trading table that includes; latest fx tradinghigh-low-close range, Bollinger Bands, Fibonacci retracement levels, daily forex pivot points support and resistance levels, average daily forex range, MACD for the different currency trading pairs. You can look on the forex forum for updates when one of the fx trading tools is updated.
Global-View also offers a full fx trading chart gallery that includes fx pairs, such as the EURUSD, commodities, stocks and bonds. In a fx trading world where markets are integrated, the chart gallery is a valuable trading tool. Look for updates on the Forex Forum when the chart gallery is updated.
Global-View.com also offers a forex blog, where articles of interest for currency trading are posted throughout the day. The forex blog articles come from outside sources, including forex brokers research as well as from the professionals at Global-View.com. This forex blog includes the Daily Forex View, Market Chatter and technical forex blog updates. In additional to its real time forex forum, there are also Member Forums available for more in depth forex trading discussions.
WARNING: FOREIGN EXCHANGE TRADING AND INVESTMENT IN DERIVATIVES
CAN BE VERY SPECULATIVE AND MAY RESULT IN LOSSES AS WELL AS PROFITS. FOREIGN
EXCHANGE AND DERIVATIVES TRADING IS NOT SUITABLE FOR MANY MEMBERS OF THE
PUBLIC AND ONLY RISK CAPITAL SHOULD BE APPLIED. THE WEBSITE DOES NOT TAKE
INTO ACCOUNT SPECIAL INVESTMENT GOALS, THE FINANCIAL SITUATION OR SPECIFIC
REQUIREMENTS OF INDIVIDUAL USERS. YOU SHOULD CAREFULLY CONSIDER YOUR FINANCIAL
SITUATION AND CONSULT YOUR FINANCIAL ADVISORS AS TO THE SUITABILITY TO YOUR
SITUATION PRIOR TO MAKING ANY INVESTMENT OR ENTERING INTO ANY TRANSACTIONS.