European market Update: Global equity markets appears to reprice the whole global economic recovery prospects with deepening concerns over the widening credit spreads
Thursday, February 04, 2010
European market Update: Global equity markets appears to reprice the whole global economic recovery prospects with deepening concerns over the widening credit spreads
*** ECONOMIC DATA *** - (SZ) Swiss Dec Trade Balance (CHF): 1.4B v 2.0B prior; Exports M/M: -1.6% v 2.1% prior; Imports M/M: -5.6% v 1.9% prior - (UK) Jan Halifax House price M/M: 0.6% v 0.7%e; 3M/Yr: 3.6% v 3.6% - (UK) Jan New Car Registrations: 29.8% v 38.9% prior - (BR) Brazil COPOM monetary policy meeting minutes from Jan 27th : Output gap was being reduced by domestic demand; Prepared to shift its policy stance if conditions warrant - (GE) Germany Dec Factory Orders M/M: -2.3% v 0.2%e; Y/Y: 8.4% v 9.6%e
*** SPEAKERS/FIXED INCOME/FX/COMMODITIES/ERRATUM *** - In equities: Following a brief foray into positive territory, European markets have turned decisively negative. Negative trading followed a broadly lower Asian session that saw the Nikkei retreat under pressure from Toyota [TM] and the Hang Seng fall as investors participated in broad financial sector profit taking. Trading in Europe took a cue from continued disappointing earnings in the energy sector, with Royal Dutch [RDSA.UK] following BP [BP.UK] and Exxon [XOM] with disappointing mid stream and refining figures. Deutsche Bank [DBK.GE] highlighted the earnings from Euro financials that included Santander [SAN.SP] and Dankse DANSKE.DE]. Deutsche posted a strong Net figure, but showed builds in losses provisions and underwhelmed the market. Insurance name Zurich Financial [ZURN.SZ] posted strong figures and announced a dividend hike that was positively greeted by the market. Financials have continued their lower rotation as the trading session is dominated from overhangs in the central bank arena. Markets are anticipating decision from both the BoE and ECB. Trading volumes have been high throughout the European morning with major bourses significantly beating their moving averages. Yesterday's closing loss snapped a three session positive trend.
In individual equities: Deutsche Bank [DBK.GE]: Reports Q4 Net â‚¬756M v â‚¬685Me (ex tax benefit), Rev â‚¬5.5B v â‚¬6.0Be, proposes FY09 div at â‚¬0.75/shr v â‚¬0.50 y/y. || Vodafone [VOD.UK]: Reports Q3 Rev Â£11.5B v Â£11.4Be; FY09 free cash flow expectations raised to Â£6.5-7B. || Royal Dutch [RDSA.UK]: Reports Q4 Net $1.96B v $2.9Be, Rev $81B v $68.5Be. || Zurich Financials [ZURN.SZ]: Reports Q4 Net $1.05B v $1.1Be, FY09 Gross Written Premiums $34B -8% y/y; Increases dividend payment to CHF16 v CHF11 prior. || Santander [SAN.SP]: Reports FY09 Net â‚¬8.94B v â‚¬8.9Be, Rev â‚¬39.4B v â‚¬39.1Be. || Unilever [UNA.NV]: Reports Q4 Net â‚¬906M v â‚¬877Me, Rev â‚¬9.66B v â‚¬10.1Be, declares quarterly dividend of â‚¬0.195/shr v â‚¬0.125/shr y/y.
- Speakers: IMF's Strauss-Kahn commented that economic growth remained fragile and stressed that governments need to spell out how they plan to reduce their debt in the medium term outlook. He did not believe that Greece was at risk of bankruptcy but conceded the situation was serious. He again expressed confidence that the Greek PM would take the necessary steps to curb its deficits. He stated that the Euro-Zone would deal with the Greek situation (reply to question whether IMF would aid Greece) and added that the IMF would help Greece if asked. The crisis in Spain was very strong and the country needed to make a considerable effort*** Bank of International Settlements (BIS) Caruana commented that conditions for global growth were better but risks remained. He added that it was hard to determine if a double-dip recession would occur but that the financial system might be a headwind for recovery. Central Banks must expect additional volatility throughout the recovery. Global inflation pressures were low and central banks must keep expectations anchored. He cautioned the danger of exiting special measures too late and that governments must ensure that debt situation is at a sustainable level or face trouble ***Moody's stated that it has NOT placed Spain's " AAA" sovereign rating under review *** Spain Econ Min Salgado stated that she saw no risk to the Euro-Zone membership. She added that her country's fiscal situation was very different than that of Greece *** Norway Fin Min Johnsen commented that fiscal policy must not lead to higher interest rates and that Gov't must return to its spending rules *** China Foreign Min Zhaoxu stated that the Yuan currency level was not the main reason for the US trade deficit with China. He added that outside pressure would not help resolve the exchange rate issue. He also commented that sanctions against US companies that sell arms to Taiwan were appropriate *** China Banking Regulator CBRC Shanghai's branch stated that stress test results show that Mortgage NPL would increase to 1.18% from 0.45% with a 10% decline in home prices *** Former BOE member Julius commented that a risk of a UK debt or currency crisis could occur within six months *** S&P issued a report on Spanish and Russian local and regional governments (LRGs) and concluded that credit quality was likely to remain under pressure in 2010 *** Brazil Central Bank (COPOM) released its minutes from Jan 27th decision and noted that the country's output gap was being reduced by rising domestic demand. It pledged to remain vigilant to prevent short-term inflationary pressures from expanding into the longer-term picture. The central bank was prepared to shift its policy stance if conditions warranted. ***Japan's MOF forecasted Â¥51.3T in new bond issuance for FY2011/12 (Begins in April)
- Currencies: The European fiscal situation continues to be the catalyst for currency movements in the aftermath of the EU approval of the Greek austerity plan. As noted on Wednesday the EU approval of the Greek plan had dealers believed that the commission's findings were actually somewhat less favorably beyond the headline 'approval' of the austerity plan. Various European and quasi-gov't officials continued to express optimism over countries will and effort to tame burgeoning debt levels and budget deficits over the medium term. However, Euro continued to exhibit weakness and tested below the Jan lows of 1.3850 for fresh seven month lows. Dealers noted that there are a plethora of key events over the next 48 hours with BOE, ECB rate decisions, US payroll data and a G7 summit. The effects of which will see whether the EUR/USD can hold above some pivot chart points and technical levels. The 1.3740 area in the pair was a pivot last summer when reserve diversification was the on-going theme and the 1.3825 area is deemed a key weekly close level.
- Fixed Income: In a well subscribed auction covered 1.9 times, Spain sold â‚¬2.5B in 2013s, in the middle of the range of expectations in terms of size But the auction has provided little respite for euro-zone peripherals with Portugal the worst performer, wider by another 10bps at +154bps, and Greece another 3bps wider and above +350bps - CDS spreads are also surging. Spain +18bps, Portugal +13bps, Italy +11bps. Market chatter has focused on the Itraxx Sovereign CDS Index , which closed wider than the CDX Investment Grade Index yesterday - a disconcerting illustration of the transfer of indebtedness from the private to public sector over the past 12 months. Lost ground has yet to be recovered after Moody's stated that it had NOT placed Spain's Aaa rating under review - Core markets are subdued ahead of key interest rate decisions from the BoE and ECB, with yields and cross market spreads range bound. France sold a combined total of â‚¬7.9B in off the run OAT's - at the top of the range of expectations in terms of size and auctions well covered.
-Geo/political: Argentina Pres Kirchner appointed a new Central Bank Pres, Mercedes Del Pont; the appointment is now awaiting Senate confirmation. Pont is seen as strong supporter of Kirchner and of gov intervention in the domestic economy. Pont is expected to support plans to use $6.57B of state reserves to service international loans. Pont has previously supported legislation that critics have described as significantly reducing the independence of the Central Bank as an institution. The UK MoD has released a 'Green Paper' defense strategy update. The paper confirms the belief that the UK is best served by maintaining a deployable, global military reach as its primary security threats remain international. However, rising costs and debt levels mean that stand alone projects will need to be scaled down. The paper calls for intensified cooperation with allies, specifically European states (France) in synchronizing their military spending and capabilities. UK military forces are a key ally of the US in its prosecution of the Global War on Terror (GWOT). Expanded sanctions against Iran have continued to hit headwinds. China has once again remained on the sideline, with a negative outlook, on tougher sanctions. Chinese diplomats stated that increased pressure on Iran would only limit/derail diplomatic efforts. In yesterday's session, France and Germany both vocally reaffirmed their position that further sanctions against an unrepentant Iran would be justified. US and UK diplomats have questioned the legitimacy of Iran's agreement to move nuclear fuel outside of the country for enrichments, stating the action is seemed as more of a red herring, seeking to bide for more time.
***Notes: - European peripheral spreads remain under pressure. - Commodity prices as softer after Australian retail sales and NZ employment both came in weaker than expected. March Copper futures under the 3.00 level throughout the European morning. . - Traders feeling that the global equity markets appears to reprice the whole global economic recovery prospects with deepening concerns over the widening credit spreads. - Monster online employment index 114 in Jan vs 115 in Dec. - EU commission findings on Greece seem somewhat less favorably beyond yesterday's 'approval' of the austerity plan - Talk that the US annual employment benchmark revision could show loss of over 800K - BoE and ECB interest rate decisions this morning
***Looking Ahead: - Plethora of US earnings ahead of the equity open; Jan Same-store sales data for major retailers. AVP, BKC, CI, CLX, K, MA, RAI, SLE expected to report - (RU) Russia Jan Consumer Prices M/M: 2.0%e0.4% prior; Y/Y: 8.4%e v 8.8% prior; CPI YTD: 2/0%e - (RU) Russia Jan Core CPI M/M: 0.9%e v 0.4% prior; Core CPI YTD: 0.9%e v 8.3% prior - (RU) Russia Gold & Forex Reserves w/e Jan 29th$ v $435.6B prior - 7:00 (UK) BOE interest rate decision: Expected to maintain both interest rates and Asset purchase targets at current levels (0.50% and Â£200B respectively) - 7:00 (CZ) Czech Central Bank Interest Rate Decision: Expected to maintain the Repo Rate at 1.00% - 7:30 (BR) Brazil Jan Vehicle sales: No est v 293.0K prior; Vehicle Production: No est v 251.5K prior - 7:30 (EU) ECB Interest Rate Decision: Expected to maintain main Refi rate at 1.00% - 8:30 (CA) Canada Dec Building Permits M/M: 2.5%e v -4.6% prior - 8:30 (US) Q4 Preliminary Nonfarm Productivity: 6.5%e v 8.1% prior; Unit Labor Costs: -3.5%e v -2.5% prior - 8:30 (US) Initial Jobless Claims: 455Ke v 470K prior; Continuing Claims: 4.581Me v 4.602M prior - 8:30 ECB press Conference - 10:00 (CA) Canada Jan Ivey Purchasing managers Index: 53.0e v 48.4 prior - 10:00 (US) Dec Factory Orders: 0.5%e v 1.1% prior - 10:00 (MX) Mexico Jan Consumer Confidence: 79.8e v 80.1 prior - 10:30 (US) Jan ICSC Chain Store Sales Y/Y: No est v 2.8% prior - 16:00 (CO) Colombia Jan Producer Price Index M/M: No est v 0.9% prior; Y/Y: No est v -2.2% 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."
Elevate Your Trading With The Amazing Trader!
The Amazing Trader includes:
Actionable trading levels delivered to YOUR charts in real-time.
Mon 18 Dec
10:00 EZ- final HICP Tue 19 Dec
09:00 DE- IFO Survey
13:30 US- Housing Starts/Permits
13:30 US- Current Account Wed 20 Dec
15:00 US- Existing Homes Sales
15:30 US- EIA Crude Thu 21 Dec
03:00 JP- BOJ Decision
13:30 CA- CPI & Retail Sales
13:30 US Weely Jobless
13:30 US- GDP Fri 22 Dec
09:30 US- GB- GDP
13:30 US- core PCE Deflator & Presonal Income
15:00 US- New Homes Sales
15:00 US- final University of Michigan
17:00 US- early Closes Mon 25 Dec
00:00 Christmas Holidays
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.