European Market Update: Greek debt insurance now the most expensive in the world; 5-year CDS over 900bps
Wednesday, April 28, 2010
European Market Update: Greek debt insurance now the most expensive in the world; 5-year CDS over 900bps
*** ECONOMIC DATA *** - (FI) Finland Mar Preliminary Retail Sales Volume: 8.4% v 1.3% prior - (HU) Hungary Mar Unemployment Rate: 11.8% v 11.5%e - (SP) Spain Mar Adj Real Retail Sales Y/Y: 2.1% v -1.0%e; Real Retail Sales Y/Y: 3.5% v -1.1% prior - (GE) Germany Apr CPI Saxony M/M: -0.1% v 0.6% prior; Y/Y: 1.1% v 1.3% prior - (SW) Sweden Mar Unemployment Rate: 9.1% v 9.5%e - (IT) Italy Apr Business Confidence: 85.5 v 85.0e - (GE) Germany Apr CPI Hesse M/M: -0.1% v 0.4% prior; Y/Y: 0.8% v 0.8% prior - (GE) Germany Apr CPI Brandenburg M/M: 0.0% v 0.3% prior; Y/Y: 0.7% v 0.8% prior - (GE) Germany Apr CPI Baden Wuerttemberg M/M: -0.2% v 0.7 prior; Y/Y: 1.1% v 1.3% prior - (SA) South Africa Mar CPI (all items) M/M: 0.8% v 0.9%e; Y/Y: 5.1% v 5.2%e - (GE) Germany Apr CPI Bavaria M/M: -0.1% v 0.5% prior; Y/Y: 0.9% v 1.1% prior
*** SPEAKERS/FIXED INCOME/FX/COMMODITIES/ERRATUM *** - Equities: European equity bourses have added to their losses from yesterday's session on the back of sovereign risk issues emanating from the European peripherals. Joining a global equity market selloff, S&P comments on Portugal and Greece on Tuesday have once again centered financial market attention on debt and sovereign default issues. European bourses opened offered and accelerated to the downside after 4:00EST as the ECB provided the results of a Q1 lending survey that confirmed expectations that banks had indeed tightened credit standards for lending to both private and commercial end clients. Ahead of the open, Greek market regulators stepped in to ban short-selling following continued losses in listed financials. This action has served to roll selling interest from Greek banks directly to European banks with Greek exposure; financials have led the lower rotation. Macro level commentary has all but washed out corporate news as Europe moved into the thick of earnings season. German blue-chips SAP [SAP.GE], Merck [MRK.GE] and Infineon [IFX.GE] reported, with Merck and Infineon both upgrading FY10 guidance. In the UK, Royal Dutch Shell [RDSA.UK] followed BP [BP.UK] with significantly stronger than expected earnings figures. Additional UK names that reported included both Rolls Royce [RR.UK] and Home Retail [HOME.UK]. Earnings figures from the alternative energy sector have been mixed as solar manufacturer Renewable Energy [REC.NO] beat estimates (and provided supportive 2010 ASP guidance), while wind turbine name Vestas [VWS.DE] missed estimates with a negative net (though the firm maintained its 2010 guidance). Earnings news and macro events have sent trading volumes massively higher. Turnover in financials, highlighted by RBS [RBS.UK] and Lloyds [LLOY.UK] sent volumes on the FTSE100 over 300% higher than moving averages.
- Individual equities: Infineon [IFX.GE] reported Q2 Op profit â‚¬110M v â‚¬96Me, Rev â‚¬1.04B v â‚¬1Be; raises FY10 guidance.|| Merck Ag [MRK.GE] reported Q1 Net â‚¬195M v â‚¬233Me, Rev â‚¬2.1B v â‚¬2Be; Raises FY10 operating profit guidance.|| SAP [SAP.GE] reported Q1 Net â‚¬387M v â‚¬390Me (not clear if comparable), Rev â‚¬2.51B v â‚¬2.4Be; Reaffirms outlook. Continental [CON.GE] offered a preliminary Q1 EBIT â‚¬494M v â‚¬370Me, Rev â‚¬6.0B vâ‚¬5.4Be; confirms FY10 guidance. Royal Dutch Shell [RDSA.UK] reported Q1 Net $5.8B v $4Be, Rev $86.1B v $67.3Be. Rolls Royce [RR.UK]: Interim management statement: Have seen signs of stabilization, environment remains challenging. BBVA [BBVA.SP] reported Q1 Net â‚¬1.24B v â‚¬1.2Be, Net interest income â‚¬3.39B v â‚¬3.4Be. Renewable Energy [REC.NO] reported Q1 Pretax NOK730M v loss NOK274Me, Rev NOK2.36B v NOK2.4Be. Vestas [VWS.DE] reported Q1 Net loss â‚¬82M v profit â‚¬15Me, Rev â‚¬755M v â‚¬963Me; Reiterates FY10 guidance. Home Retail [HOME.UK] reported prelim FY10 Pretax profit Â£293M v Â£299.8M y/y, Rev Â£6.02B v Â£5.9B y/y.
- Speakers: EU confirmed that it would hold a summit on May 10th to discuss Greece *** Germany's Dep Fin Min Asmussen stated that 2010 remained a year of fiscal expansion and that was working hard on exit strategy from fiscal support measures. H expressed optimism that Germany economy would continue to recover throughout the year but did concede that the rebound remained fragile. Financial markets have stabilized but remain far from normal. All EU members must consolidate budgets and sought tougher penalties for member States that break budget rules. He forecasted that Germany's 2010 deficit to GDP ratio would be 5.5% and it s Total debt to GDP ratio at 79% *** ECB's Stark commented that the crisis was not over yet and that the deterioration in public finances remained a concern. He reiterated that high budget debt might drive inflationary expectations and was carefully watching commodity prices in emerging markets. It was not clear if global recovery was yet sustainable but reiterated that ECB interest rates were appropriate. He saw clear signs of improvement in Euro Zone and global economies and that talk of credit crunch in EU was unfounded . On the European peripherals, Stark stated that he saw no connection between Greece and Portugal as Greece was a singular case. ECB purchases of Greek bonds was not being discussed and that the issue at hand was loans and not transfers***ECB's Mersch commented on the peripheral situation in Europe and stated that "We are in a crisis situation and need verbal discipline". He noted that it was possible the new shock could trigger more write downs in banking sector. He observed that each country's situation was different in regards to any contagion risk bu t expressed confidence about result of talks that are occurring related to Greece. The European Union, International Monetary Fund and ECB have the task of bringing Greece back to the path of sustainable growth. He also noted that asset prices were an essential factor in determining monetary policy ***China PBoC published its 2009 China Financial Market Report and noted that the : 2010 Global recovery continued to be fragile. The central bank would manage inflationary expectations. It did not expect the US to exit stimulus policy in short-term. China would maintain consistency and stability in its monetary policy and reiterated the stance to maintain "moderately loose" monetary policy this year. It noted that equities in China could face turbulence and it would take steps to stabilize the domestic equity market. It saw ising risks in China's fiscal and financial areas this year and added that the Chinese banking sector needed to replenish capital base. ***
- Currencies/Fixed Income: Another volatile session on the fixed income side for the peripherals as concerns heightened about potential sovereign defaults. The USD continued to benefit from risk aversion flows. The cost to insure against bond losses continue to hit new heights following the Tuesday sovereign downgrades of Greece and Portugal deb. Greek two-year note yields soared to 21.4% then hit hyper drive to test over 38% while the spread between Greek/German 10-year bonds approached 1,000bps. The EUR/USD tested fresh one-year lows at 1.3142 and edged nearer to the 8-year uptrend line at 1.3070 area. Vague chatter circulated that the UK could lose its "AAA" sovereign rating as the GBP/USD tested 1.5150
***Notes/Observations: - Greek debt insurance now the most expensive in the world; 5-year CDS over 900bps; 10-year spread against Germany over 1,000bps - Germany to meet ECB, EU and IMF in Berlin today to talk about German reluctance on Greece. - Japan retail sales above expectations - China 1 yr T-bill auction undersubscribed - FOMC meeting later today with rhetoric maintaining the "extended period"
***Looking Ahead*** - (GE) Germany Apr Consumer Price Index M/M: 0.2%e v 0.5% prior; Y/Y: 1.2%e v 1.1% prior - (GE) Germany Apr CPI EU Harmonized M/M: 0.2%e v 0.6% prior; Y/Y: 1.3%e v 1.2% prior - 7:00 (US) MBA Mortgage Applications w/e Apr 23rd: No est v 13.6% prior - 7:00 ECB's Honohan speech in Dublin - 8:00 (PD) Poland Central Bank interest rate decision: Consensus expectations for the Base Rate to remain unchanged at 3.50% - 9:00 (GE) German Finance Ministry press conference with ECB and IMF heads - 9:00 (BE) Belgium Q1 Preliminary GDP Q/Q: No est v 0.3% prior; Y/Y: No est v -0.8% prior - 9:00 (CL) Chile Mar Industrial Production Y/Y: -7.3%e v 0.5% prior; Industrial Sales Y/Y: -3.3%e v 1.5% prior - 9:00 (CL) Chile Mar Total Copper Production: No est v 394.7K tons - 9:00 (CA) Canada Feb House Price Index Y/Y: No est v 7.5%e - 10:00 (MX) Mexico Mar Remittances: No est v $1.6Be - 10:00 (US) Treasury's Wolin - (US) Weekly DOW energy inventories: Crude +750Ke; Gasoline: +500Ke; Distillate: +1.2Me; Utilization: 85.9%e - 11:00 (GE) Germany's Merkel meets with OECD's Gurria, WTO's Lamy and IMF's Strauss-Kahn - 11:30 (GE) Germany's Fin Min Schaeuble briefing on States finance - (SZ) Swiss President Leuthard on post financial crisis - 13:00 (US) Treasury to sell $42B in 5-year notes - 14:10 (US) FOMC Interest Rate Decision: Expected to maintain interest rates unchanged at 0.25% - 15:00 (AR) Argentina Mar Supermarket Sales Y/Y: No est v 12.9% prior - 17:00 (NZ) New Zealand Central Bank Interest Rate Decision: Expected to maintain the Official cash Rate unchanged at 2.50% - (BR) Brazil Central Bank (COPOM) Interest Rte Decision: Expected to raise the SELIC target Rate by 50bps to 9.25% (Currently at 8.75%)
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.