Thursday September 16, 2010 - 03:42:11 GMT
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Morning Briefing : 16-Sep-2010 - 0341 GMT
The US Equities ended higher over good industrial production numbers yesterday. The Dow (10572.73) was up 0.44% and the S&P 500 (1125.07) was up 0.35%. While above 10400, the Markets may now see some upmove towards 10700-50 in a couple of weeks.
The Asian Equities are mixed today. The Nikkei (9544.81, up 0.30%) has is continuing to trade higher over weaker Yen and may touch 9700-50 in a couple of weeks. The Shanghai (2610.38, down 1.59%) fell for the second day on speculation that the government may curb bank lending. In India, the Sensex (19502.11, up 0.80%) and the Nifty (5860.95, up 1.13%) were up following the strong asian equities. A break above 19500 may see it move up towards 20000-200 in a couple of weeks.
Crude (75.60) fell for the second consecutive day and is now trading below 76. Although the EIA's data release showed a drop in US Crude inventories as expected, the news that the repair works on Enbridge's damaged pipeline was complete and the expectation that it would resume operation by this weekend which could increase the supplies kept the Crude price lower yesterday.Support is seen in 75-74 region which might be tested in the coming days.
Gold (1268) is continuing to trade higher. Resistance is seen in 1275-80 region and we might expect some profit taking at these levels. However, the broader picture is bullish for a rise towards 1320-50. To see the Gold graph click on the following link:
There is still a chance that the Dollar, which has its back to the wall now, might fight back. The Euro (1.2985) again met important Resistance in the 1.3030-50 region yesterday and has backed off slightly from there. Whether this Resistance holds or breaks is likely going to set the tone and trend for the rest of the year. Dollar-Yen (85.30) has come off a bit after rising to 85.77 in late US/ early Asian trading, as the market perceives Resistance at 86.00. The BOJ will have to prove its determination to make yesterday's intervention stick by coming in to buy again, either today or tomorrow.
Dollar-Swiss (1.0025), which doesn't have the benefit of SNB intervention anymore, has been consolidating above 1.0000 since yesterday. It could attract buying interest near 0.9985, if a dip is seen today. The Pound (1.5603) rose to 1.5652 in the US session. Having broken past the 1.53-55 range, there might be chances of the Pound moving higher in the days/ weeks ahead.
The Aussie (0.9353) ran into some profit-taking yesterday and has dipped lower today. It has a crucial Support at 0.9334 today. If it holds, we may see a final rally to 0.9520 where the uptrend could terminate. If the Support at 0.9334 breaks, the uptrend might have ended already.
Dollar-Sing (1.3378) is somehow managing to remain above 1.3350. A rise above 1.3400 will give it a better Support. Dollar-Won (1162.30) is continuing to trade below 200-day MA at 1164.57. The Chinese Yuan has strengthened further to 6.7295 today. The Brazilian Real (1.7212) has weakened a decent bit over the last couple of days after having strengthened to 1.6599 on Tuesday. Dollar-Rupee (46.3550 yesterday) might rally a bit today. All eyes will be on the RBI Monetary Policy meeting today.
The 3M USD LIBOR was unchanged at 0.29%. The 2Y yields were down 1 bps to quote at 0.49% and the 10Y yields were up 2 bps to quote at 2.70%.
07:30 GMT SNB Meeting
...Expected 0.25%...Previous 0.25%
08:30 GMT RBI Repo Rate
08:30 GMT RBI Reverse Repo Rate
08:30 GMT RBI CRR
09:00 GMT EU Trade Bal
...Expected -0.7 Bln...Previous -1.6 Bln
14:00 GMT July US Philifed Index
...Expected 0.9...Previous -7.7
12:30 GMT US July Core PPI (MoM)
...Expected 0.1%...Previous 0.3%
12:30 GMT US July Core PPI (YoY)
...Expected 1.5%...Previous 1.3%
12:30 GMT US Current Account Balance
...Expected $ -124 Bln...Previous $ -109 Bln
13:00 GMT US June TICS (Net foreign purch of long-term Sec)
...Expected $ 37.9 Bln...Previous $ 44.4 Bln
...Actual 7.8%...Previous 7.8%
EU July CPI (YoY)
...Actual 1.0%...Previous 1.0%
US July Industrial Production
...Actual 0.2%...Previous 1.0%
US July Capacity Utilization
...Actual 74.7%...Previous 74.8%
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