Wednesday October 6, 2010 - 03:42:13 GMT
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Morning Briefing : 06-Oct-2010 - 0339 GMT
GOOD MORNING!
EQUITIES
The US Equities surged after the US ISM Non-manufacturing PMI expanded last month, coupled with the BOJ move to cut interest rates to virtually zero. The Dow (10944.72) was up 1.80% and the S&P 500 (1160.75) was up 2.09%. The Dow may see some Resistance near 11000-500 region, a break above which may take it towards 11250 in the coming weeks.
Celebration in Asian equitites today. The Nikkei (9641.34, up 1.29%) continued yesterdays rally following the comprehensive monetary easing by BOJ. In Australia, the All Oridnaries (4729.10, up 1.47%) is trading higher following the RBAs decision to keep rates unchanged yesterday and surge in Gold prices. The Shanghai (2655.66) is closed on account of National Day till Thursday, 7-Oct-10. In India, the Sensex (20407.71, down 0.33%) and the Nifty (6145.80, down 0.22%) closed lower yesterday. The markets have been silent for the past 2 days but may see some strong upmove today, followed by an eventual rise towards 21500-22000 in the coming weeks.
COMMODITIES
Crude (82.65) has risen above 82 and is continuing to trade strong following the weaker dollar and strong equity markets. Strong Support is seen at 80 and while above 80 there are good chances of a rise towards 90 in the coming days. The weekly candles are looking strong and a strong close above this week might increase the chances of revisiting 100 in the coming weeks/months. To see the Crude weekly candles click on the following link:
http://www.kshitij.com/graphgallery/nymexcrudecandle.shtml#candle
Gold (1342.10) has risen sharply breaking above its Resistance at 1320 thereby wiping out the chances of a correction that we had mentioned yesterday. The overall bullish sentiment is intact and we might see further rise towards 1370-75 in the coming days.
CURRENCIES
Dollar is trading weak all over. The Euro (1.3830) and has very important Resistance in the broad 1.3875-3915 region which might be tested today. Dollar-Yen (83.16) is retaining its downside pressure and might see a break below its crucial Support at 83 which might pull it further down towards 81.50-00. The Euro-Yen Cross (115.00) is retaining its upside momentum and might test its important Trendline Resistance at 115.78. A break above this Resistance might increase the chances of further rise towards 120.
Dollar-Swiss (0.9657) may see some moev in teh range of 0.9625-75 followed by some recovery towards 0.9700-25 today. Aussie (0.9690) has again come up to trade near 0.9700 but has been unable to break it. The pair has strong Resistance at 0.9700 and it needs to be seen whether it is honoured or broken. Cable (1.5914) may move up further towards 1.5950-75 today.
The Asian Currencies are trading strong. The Korean-Won is trading near 1120 and the Sing-Dollar is trading near 1.3103. DOllar-Rupee has closed higher yesterday at 44.69/70. However, given the overall weakness in the dollar and with Resistance in 44.75-80 region, it might retest the Support at 44.20.
INTEREST RATES
The 3M USD LIBOR was unchanged at 0.29%. The 2Y yields and 10Y yields were down 1 bps each to quote at 0.41% and 2.47% respectively.
DATA TODAY
09:00 GMT EU GDP Q2 '10 2nd
...Expected 1.0%...Actual 1.0%
http://www.kshitij.com/fundamentals/funcharts/eugdp.shtml
12:15 GMT US ADP Emp
...Expected 22K...Actual -10K
DATA YESTERDAY
Sep Australia Trade Balance
...Actual A$ 2.35 Bln...Previous A$ 1.74 Bln
AUD RBA Interest Rate
...Actual 4.50%...Previous 4.50%
BOJ Meeting
...Actual <0.10%...Previous 0.10%
EU Retail Sales
...Actual -0.4%...Previous 0.1
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