European Market Update: Markets to test Japan's resolve on the JPY currency appreciation trend; Safe-haven flows propel 10-year yields on Bunds and Gilts to record lows (Trade the News)
Tuesday, August 24, 2010
European Market Update: Markets to test Japan's resolve on the JPY currency appreciation trend; Safe-haven flows propel 10-year yields on Bunds and Gilts to record lows
***Economic Data*** - (GE) Germany Q2 Final GDP Q/Q: 2.2% v 2.2%e; Y/Y: 4.1% v 4.1%e; GDP wda Y/Y: 3.7% v 3.7%e - (GE) Germany Q2 Private Consumption: 0.6% v 0.4%e ; Government Spending: 0.4% v 0.5%e; Domestic Demand: 1.4% v 1.5%e; Imports: 7.0% v 7.5%e; Exports: 8.2% v 7.9%e - (FI) Finland July Unemployment Rate: 7.5% v 7.6%e - (GE) Germany Q2 Construction Investment: 5.2% v 7.3%e; Capital Investment: 4.7% v 3.8%e - (CZ) Czech Aug Business Confidence: 11.7 v 11.6 prior; Consumer Confidence:-11.8 v -7.3 prior; Consumer & Business Confidence: 7.0 v 7.8 prior - (AS) Austria Jun Industrial Production M/M: -0.6% v 1.3% prior; Y/Y: 5.7% v 7.6% prior - (SW) Sweden Q2 Total Number of Employees Y/Y: -0.6% v -1.5% prior - (PD) Poland July Retail Sales M/M: 3.2% v 2.6%e; Y/Y: 3.9% v 4.1%e - (PD) Poland July Unemployment Rate: 11.4% v 11.4%e - (UK) July BBA Loans for House Purchase: K v 34.0Ke - (EU) Euro Zone Jun Industrial New Orders M/M: % v 1.5%e; Y/Y: % v 24.0%e - (SA) South Africa Q2 GDP Y/Y: 3.0% v 3.2%e; GDP Annualized: 3.2% v 3.8%e
Fixed income - (SP) Spain Debt Agency sold total â‚¬4.0B in 3-month and 6-month Bills versus â‚¬4.5B indicated - Sold â‚¬2.7B in 3-month Bills; avg yield 0.629% v 0.672% prior; Bid-to-cover: 2.2x v 5.7x prior - Sold â‚¬1.31B in 6-month Bills; avg yield 1.037% v 1.144% prior; Bid-to-cover: 3.9x v 2.2x prior - (SA) South Africasold ll ZAR1500 Mln R207 Bonds and Sell ZAR600 Mln R213 Bonds - Sold ZAR1.5B in R207 Bonds, clearing yield 7.85% - Sold ZAR600M in R213 Bonds, clearing yield 7.98% - (EU) ECB allotted â‚¬150.3B in its 7-day main refi operation at fixed 1.0% - (HU) Hungary Debt Agency sold HUF50B in 3-month Bills versus HUF50B planned; avg yield 5.38% v 5.28% prior; Bid-to-cover: 2.6x v 2.3x prior
*** SPEAKERS/FIXED INCOME/FX/COMMODITIES/ERRATUM ** ***Notes/Observations*** - Japan continues with verbal intervention with little effect. JPY hits 9 year highs against EUR and 15 year highs against USD; Japan Nikkei 225 Index closes below 9,000 for the first time in 15 months - Record low 10-year yields in Europe. German 10-year Bunds approaching 2.20%; 10-year Gilts below 2.92% - BoE newest member Weale: Sees "significant" risk of double-dip recession; - Australian opposition leader Abbott: No one should expect a speedy resolution to political situation. - Price of progress: 60-mile traffic jam in China which has lasted 10 days because of road construction
- Equities: - As of 5:30am ET Euro Stoxx 50 Index -1.3% at 2,626; DAX Index -0.9% at 5,957; CAC-40 Index -1.3% at 3,508 and FTSE 100 Index -1.1% at 5,179 - Risk aversion concerns continued to simmer aided by comments from the BOE newest member spoke of the double-dip scenario.
- Swiss chocolate maker Lindt & Spruengli [LISP.SZ] reported better than expected results and reiterated its FY10 outlook, a positive surprise given the rising prices for cocoa beans and extreme valuations of currency. In follow up comments, the CEO was confident company would be able to deal with even a stronger Swiss franc. Kabel Deutschland [KD8.GE] out of Germany reported disappointing results with a loss wider than expected and revenues lower than consensus. However, the loss was an improvement compared to last year's results and main metrics such as ARPU had increased. Company adjusted its FY10 EBITDA outlook, projecting the EBITDA at the higher end of the range of â‚¬715-725M and reiterated FY11. - Among notable UK names, Antofagasta [ANTO.UK] reported revenues in line with estimates and a higher net profit over the prior comparable period. However, it lowered its guidance production for copper which sent the shares in the red. Cairn Energy [CNE.UK] reported strong results in terms of net earnings and revenues but disappointed investors with the exploration campaign in Greenland. The gas found in its first Greenland well does not have commercial values. The company (and the market) had hoped for oil discovery but still noted that the discovery of gas in thin sands is indicative of an active hydrocarbon system. Aer Lingus [AERL.UK] narrowed its loss compared to last year's period but revenues had decreased. The outlook was positive and the company expected its 2010 operating result (before exceptional items) should be no worse than break even. - In M&A news Korea National Oil Company [KNOC] confirmed reports that it was not planning to raise its Â£1.7B offer for Dana Petroleum [DNX.UK]. Company went hostile taking the offer to the shareholders, 48% of which support KNOC's bid.
Speakers: - German Econ Min Bruederle commented after the final Q2 GDP data and noted that the German industry and service sectors were in an economic upswing with its domestic consumption helping drive growth . He stressed that growth was not strictly driven by its export sector as both German investor and consumer confidence were returning. - Greece Debt Agency (PDMA) stated that it would begin monthly T-Bill auctions from Sept onwards for better cash management. It added that the plan was is in line with EU/IMF update memorandum - Czech Central Bank Zamrazilova commented in a press interview that Czech interest rate hikes were 'on the table' and should be discussed as soon as possible. She stated that low interest rates were a problem and created bad allocation of capital. She stressed that she was personally against the politicizing of low borrowing costs - Japan Fin Min Noda spoke at an unscheduled press conference and noted that recent currency moves were clearly 'one sided' and that it needed to watch FX with great interest. He reiterated the view that excessive and disorderly currency movements could adversely impact economy and financial system (Standard G7 line) and added that he would watch the stock markets 'more closely'. The minister had no comment on currency intervention. - Head of Japan's Trade Union Rengo union (6M member strong) calls for G7 response to JPY appreciation
- Currencies/Fixed Income: - Japanese Fin Min Noda seemed to join the long chorus of Japanese officials that the chances of direct FX intervention was slim but he did up the rhetoric a bit with the term of watching the JPY with 'great interest'. Nonetheless the JPY propelled itself against the major pairs as the market continued to test the MOF and BOJ resolve on the JPY currency appreciation. EUR/JPY fell to fresh 9 year lows of 106.10 while USD/JPY approached 84.15 for its lowest reading since April 1995. Only when Japan's largest trade union spoke out did the JPY rise momentum seem to ebb. The Head of Japan's Trade Union Rengo union with 6M members sought a G7 response to JPY appreciation. The JPY enters the NY morning off its best level but quite firm against the European counterparts. - The risk aversion theme continues to benefit the USD and JPY pairs but dealers continue to point of the potential of the CHF strength in Eastern Europe. As EUR/CHF continues to probe towards its all-time low of 1.3070 hit in July, the pain on the carry-related trades against the HUF anf PLN tyes could resurface to the front-burner. The yield on the 3-month Hungarian Bill auction crept higher by 10bps for the first rise in five auctions.
- In the Papers-Geopolitical: - Recently appointed member of Bank of England's Monetary Policy Committee Dr Martin Weale stated that he sees significant risk of double-dip recession in the UK. He goes on to say the Bank of England's central outlook for 2011 GDP at 2.8% and 2012 at 3.2% may be too optimistic. - The Telegraph's business editor Evans-Pritchard noted that according to Bank of America's chief North American economist Ethan Harris, early data points for August suggest that the already weak US recovery is becoming weaker. The weak recovery raises the risk of a double dip recession. Also the political disputes by Democrats and Republicans have the potential to worsen the US economy. -The Head of Germany's council of economic advisors Wolfgang Franz reiterated that the German economy will slow after record expansion during the second quarter. He said the weakness in US labor markets, sluggish growth in peripheral economies, and slowing recovery in emerging markets present key risks to Germany's export-driven growth. - US economist Joseph Stiglitz commented on the state of the economy in Europe and Ireland. In an interview with Irish media, the economist stated that Europe is at risk of a double dip recession. With regards to Ireland, he said that the restructuring of Irish banks are among the most problematic. In addition, the Irish government has allowed the economy in the country to get out of hand.
***Looking Ahead*** - (PD) Poland Central Bank Base Rate Announcement: Consensus expectations are for the Base Rate to remain unchanged at the current 3.50% level - (BR) Brazil July Central Govt Budget (BRL) v 630M prior - 7:00 (EU) ECB to drain â‚¬60.5B in 7-day Term deposit operation - 7:00 (BR) Brazil Aug FGV Consumer Confidence: No est v 120 prior - 7:45 (US) ICSC Weekly Retail Sales - 8:30 (CA) Canada Jun Retail Sales M/M: 0.4%e v -0.2% prior; Retail Sales Less Autos M/M: 0.1%e v -0.1% prior - 8:45 (US) Fed Evans - 8:55 (US) Redbook Weekly Retail Sales - 9:00 (BE) Belgium Aug Business Confidence: -6.0e v -6.5 prior - 9:30 (BR) Brazil July Total Outstanding Loans (BRL) No est v 1.5T prior; Private Banks Lending: No est v 879M prior; Outstanding Loans M/M: No est v 2.0% prior - 9:30 (EU) ECB calls for bids in 3-month refi tender - 10:00 (US) July Existing Home Sales: 4.65Me v 5.37M prior - 10:00 (MX) Mexico July Preliminary Trade Balance: -$730.0Me v -$340.5M prior - 10:00 (US) Aug Richmond Fed Manufacturing: 8e v 16 prior - 11:00 (US) Fed to Purchases Notes/Bonds - 12:15 (CA) Bank of Canada Murray - 13:00 (US) Treasury to Sell $37B in 2-Year Notes - 15:00 (AR) Argentina July Trade Balance: $1.3Be v $1.3B prior - 17:00 (US) ABC Consumer Confidence w/e Aug 22nd : -46e v -45 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.