Daily market reviews for commodity, forex, stock ,index and Economic Outlook.
BinaryOptionStrategy.com – The Central Bank could shrink its bond buying program in the US “in the next few meetings” according to Fed Reserve Chairman Ben Bernankes’ comments yesterday. This put pressure on the Asian stocks overnight. The surprisingly weak PMI data from China did not help. The data showed a contraction for the first time in 7 months. The figure fell to 49.6 this month from April’s final figure of 50.4. It pressured the stocks downwards while the USD strengthened. Many investors are wary about China’s economic situation, especially about the forecasts for 2013’s GDP.
The weak data from China hit the Asian stocks hard with Japanese stocks crashing down to their lowest level since both the massive earthquake and the Tsunami in 2011.
During the late Asian session the Hong Kong Hang Seng dropped 2.3 per cent, Australian ASX/200 closed 2 per cent down and the Japan Nikkei 225 tumbled 7.3. The New Zealand NZSE 50 also declined on the news and the Shanghai Composite dropped 1.32 per cent.
In Europe this morning the stocks were also lower after mostly weak releases from Germany and France. While Markit’s German service Purchasing Managers Index gained below expectations of 50.0 (up to 49.8 from 49.6 last month in France the PMI gained to 45.5 from 44.4 last month beating expectations of 44.8. The EURO STOXX 50 were down 2.25 per cent, the French CAC 40 fell 2.18 per cent and the German DAX 30 2.20 per cent on the weak sentiment following the Chinese report.
The US stocks were lower on Wednesday following the Fed reserves minutes. The DJIA closed down 0.52 per cent, the S&P 500 finished 0.83 per cent lower and the Nasdaq lost 1.11 per cent.
The USD became a safe place for investors wishing to avoid the equities. The EUR/USD lost 0.14 per cent, the USD was down 1.09 per cent against the yen. The dollar also gained against the AUD – 0.86 per cent and the CAD -0.16 per cent. Meanwhile following yesterday’s weak data from the UK the GBP continued its descent losing 0.07 per cent against the USD.
After the Fed Reserve testimony both gold and crude oil moved lower with investors taking advantage of cheap precious metals. The data from China also pushed down the Copper by 1.96 per cent while natural gas gained on warm weather in the US.
A string of important Purchasing Managers Index data is coming out of Europe today, giving investors not too much time to focus on China and the US. This will affect the euro. Then later FOMC’s Bullard will speak as well as ECB’s Draghi. Jobless claims will come out of the US. Lots of key data moving the assets today.
Japanese Stocks reached new 5 ½ year highs after the Bank of Japan confirmed its decision to increase the amount of money it is putting in to the Japanese economy from JPY 60 to 70 trillion per year. It also vowed to leave its other policies unchanged. The Bank said it would continue with easing measures as long as necessary to achieve its target of 2% inflation pledged in April.
Traders await the outcome of the Federal Reserve minutes today given by Ben Bernanke and are suspicious that the US in tend to curtail the easing measures there. The Central Bank seem to be encouraging the belief that the program will continue. Share prices in the US closed at their highest ever levels.
The Nikkei 225 rebounded and made 1.6 per cent gains to reach its highest point since Dec 2007, the Hang Seng lost 0.6 per cent and the Australian ASX/200 closed 0.3 per cent down. In Europe stocks were mixed while investors remain cautious ahead of a EU meeting. In European morning session the EURO STOXX 50 crept up 0.05 per cent, the French CAC 40 was down 0.06 per cent and the German DAX was down 0.11 per cent. The US stock prices closed higher yesterday after hints from the Fed that the stimulus measures would continue for the time being. The DJIA closed up 0.34 per cent, the S&P 500 was up 0.17 per cent and the Nasdaq gained 0.16 per cent.
The USD was mixed in the Asian session with the greenback down against the EUR and up against the JPY. The USD /JPY pair gained 0.29 per cent and the EUR/USD gained 0.25 per cent. Trading volume remains low ahead of the Fed Reserve testimony. The only other pair to stand out was the commodity linked AUD which was down 0.28 per cent as the declining commodity market affected the AUD.
Commodities were mixed with Crude declining after the supply data release from API. Gold was 0.01 per cent down, Silver was up 0.09 per cent in limited gains.
More data from the UK in the early part of the session to be watched. The British pound has had the worst year of any currency so far this year and more bad data from the UK will continue the GBPs’ declines. Then German 10-yr debt auction to watch followed by Canadian retail release and of course the key testimony by Fed Chairman Bernanke in the US session all make this a day with lots of volatility.
The Yen corrected itself over night against all of the other 16 currencies it’s paired against. This comes after the economic Minister of Japan commented that it is strongly believed that that the yen’s weakening was nearly finished. He also said that it was belief that a further weakening of the yen could negatively affect the country and its citizens economically. There is a 2 day Bank of Japan policy meeting which will be watched keenly by traders.
Meanwhile traders are also sitting on the sidelines in anticipation of the Fed Reserve comments due tomorrow given by Chairman Ben Bernanke.
Investors remain cautious ahead of the Fed Reserve meeting as it is widely expected that the Central Bank will put an end to their QE programme. This caused the Asian stocks to move between slight gains and losses. In the Asian session the Nikkei 225 saw a 0.01 per cent gain ahead of the start of todays BOJ 2 day meeting, with the Australian ASX 200 index closed up 0.6 per cent.
The EU’s second biggest trading partner China has come under some criticism by EU members who claim China cannot be a “free rider on trade” and need to take responsibility for their trade policies including exports. Chinese stocks were mixed with the Shanghai Composite up 0.03 per cent and the Hang Seng down 0.26 per cent. A summit between US and China is taking placing next month.
European stocks were mixed too in the European morning session with the EURO STOXX 50 up 0.09 per cent, the French CAC 40 down 0.14 per cent ad the German DAX 30 up 0.09 per cent.
The USD saw mixed trading with low volume as investors sit on the sidelines before the Fed Reserve and BOJ meeting. The EUR was up 0.07 per cent against the USD with the dollar up against the yen. The yen was down against all of its pairings after talk from Amari the Japanese economic minister. The AUD was up 0.22 per cent and the CAD was down 0.07 per cent.
Gold and silver rebounded from heavy losses yesterday with pressure from Central Bank. The gold was up 0.86 per cent and silver up 0.92 per cent. Crude oil was up 0.05 per cent on the stronger dollar and Natural Gas was down 0.29 per cent on warm weather.
All eyes on UK this morning as they will see a string of economic data releases in the early trading which should push up the GBP. FOMC member Bullard talks later in the afternoon and SNB Chairman Jordan and BOC Governor Carney who will all give clues as to the future of monetary policy in the US>
BinaryOptionStrategy.com – Asian stocks had a strong rally in the overnight session with Japanese stocks reaching 5 year highs pushed by strong consumer sentiment numbers from out of the US. Investors took risk on positions moving away from gold and silver and into the stocks markets.
The Japanese economic Minister Akira Amari last night commented that a further weakening in the yen could be detrimental to the Japanese people and also to the ability of the government to be able to handle it. Although this left the markets relatively untouched as Japanese stocks particularly utilities performed suberbly with the Nikkei passing the 15,000 target and reaching points not seen since 2008.
US consumer sentiment data also fueled US stocks to close on fresh highs on Friday.
The Nikkei 225 in Japan moved up 1.38per cent and the Japanese Topix Index gained 1.4 per cent, which marks a 48 per cent gain since the same time last year making this is the biggest mover of all indexes so far this year. The weakening of the South Korean currency, the Won, helped the Kospi index there gain 0.20 per cent, even with further tensions between north and south and the North’s missile testing this weekend. The Shanghai Composite in China reached seven month highs last week and continues to increase, boosted by Chinese home price data with the price of homes gaining in 68 out of the 70 recorded cities this month.
The dollar traded lower in the Asian session, with the USD/JPY declining 0.45 per cent following remarks of Japanese Minister, the AUD/USD gaining 0.33 per cent after Goldman Sachs suggesting the AUD will continue to fall against the greenback. The EUR made slight gains yet stays at near 2 month lows against the greenback .
The better than expected data from the US last week weighed heavily on the commodities and specifically the precious metals. Gold lost 1.64 per cent to trade at 1342.15 and Silver freefell by 4.86 per cent. George Soros we are told has moved away from his positions in precious metals. Natural Gas was up again by 1.55 per cent while Crude Oil dropped 0.26 per cent .
Data Releases from the UK on private sector house price inflation with expected strong numbers should push up the GBP against the dollar. You can expect the continued low volume and downtrend in the commodities as risk on sentiment continue with investors moving to the stocks. Canada, Norway and Switzerland are closed today for public holidays.
John Williams the President of the Federal Reserve Bank of San Francisco caused concern among investors after his comments that the Fed may start to cut back on its monetary easing program over the Summer and end monthly bond-purchasing towards the end of 2013. Many investors feel the US economy is not ready for this, as backed up by weak economic data releases in the US. This sent the European lows to open lower today.
Elsewhere worrying data came out of the Eurozone which is weighing on investor confidence. GDP data from the Eurozone showed a shrinking economy in the zone made up from 17 nations. A 0.2 per cent drop in GDP so far in March which means a yearly decline of 0.9 per cent.
In Europe the EURO STOXX 50 fell 0.49 per cent while the French CAC 40 lost 0.37 per cent and the German DAX fell 0.32 per cent. US Stocks closed lower following the Fed‘s comment with the DJIA down 0.28 per cent, the S&P 500 closing 0.50 per cent down and the NASDAQ falling 0.18 per cent. Asian stocks were broadly lower in the overnight session. The Nikkei 225 in Japan dropped 0.27 per cent, The ASX 200 in Australia gained 0.21 per cent. Hong Kong remains closed for a national holiday.
The greenback was up against most of its currency partners in overnight session sparked by the Feds comments. It moved up against the JPY today getting close to its 4 ½ year highest level, the USD/JPY touched 1.257 in the European session. The EUR/USD slipped 0.10 per cent lower to 1.2870 close to 6 week lows.
Gold prices which often inversely track the dollar crept 0.03 per cent down in the Asian session. Meanwhile natural gas had heavy losses after supply data showed an excess of natural gas. It lost 3.62 per cent. Oil crept down too as the price of the USD rose.
Have a good weekend!
The EUR carries on dropping through the Asian session close to its 5 week low following some weak data to come out of both France and Germany. German GDP figure moved up 0.1 per cent, although below investor expectations for Q1 of 0.3 per cent, still well above the last quarter’s 0.7 per cent drop. In France the GDP dropped 0.2 per cent which is below the expected 0.1 per cent drop following a 0.2 per cent drop in the previous quarter. Eurozone GDP preliminary data dropped 0.2 per cent in Q1.
While the GBP moves up against the USD today following some good employment data released from the UK and investor fears about the US Fed perhaps exiting prematurely from the monthly bond buying program. Investors remain cautious ahead of some economic data releases from the US later in the day.
In Europe this morning the stocks were mostly down following the German and French releases. The EURO STOXX 50 declined 0.18 per cent with the French CAC 40 down 0.15 per cent and the German DAX shrugging off the data to inch up 0.06 per cent.
In the US the stocks closed higher last night following a hedge fund managers’ comments about being bullish on US stocks which fuelled a rally on the stocks. The Dow Jones closed up 0.82 per cent, the S&P 500 was up 1.01 per cent and the Nasdaq up 0,69 per cent.
Asian stocks gained in the overnight session boosted by Sony’s share prices and remarkable profits for the first time in many years. Japanese stocks are broadly preforming higher on the back of the weaker Yen and therefore cheaper export prices. The Hang Seng in Hong Kong climbed 0.52 per cent, the Australian ASX 200 dropped 0.81per cent ad the Nikkei was up 2.29 per cent.
Dollar still climbing against most of the other majors in overnight session ahead of the US data release today. The EUR/USD was down 0.15 per cent on negative data from the Eurozone. The pair touched 1.2900. The GBP climbed against the greenback by 0.19 per cent to 1.5240. The Yen continued to weaken against the dollar overnight, hitting 102.61 a 0.08 per cent addition. The AUD declined against the USD following soft data from Australia. The pair hit 0.9884.
Gold moved up overnight even with the USD gains, usually gold and USD inversely track each other as both are considered safe havens when the other is performing weakly. Gold was up 0.06 per cent to $1.425.35 troy oz.
Natural gas continues to gain from weather reports with the commodity jumping up 1.85 per cent to $3.999 BTMUs.
All eyes have been cautiously on China following the release of yesterdays’ disappointing Industrial production and retail sales. Now it seems the Chinese government plan to implement tighter restrictions to hinder the housing market rise. We finally saw the gold price rise as a result and the Japanese Yen moving further from its lows.
In the US we saw the retail sales gaining 0.1 per cent for the last month after March’s drop. This number was hindered by petrol sales in the US where we have seen a slowing in demand. Without the petrol decline the figure would have been 0.7 per cent gain which shows an increase in consumer spending, a very good indicator for the health of their economy. It’s thought this may prompt the Fed to scale back their stimulus measures which include their monthly $85 bn bond purchasing programme.
The US dollar reversed gains against the other currencies ahead of a string of US data to be released this week including industrial production numbers, housing, and inflation.
Asian stocks were mixed on the soft data releases. The Nikkei 225 increased in the session before undoing gains and ending up 0.2 per cent down. The Australian ASX/S&P 200 closed down 0.1 per cent and the Hang Seng in Hong Kong finished 0.2 per cent down. The Shanghai Composite lost nearly 0.7 per cent .
In the US the stocks closed down yesterday, even with the retail sales release which surpassed expectations as investors cashed in profits after 3 weeks of strong performance pushed up by strong earnings, jobless claims and jobs reports. The Dow Jones closed down by 0.18 per cent, S&P 500 closed even and the Nasdaq gained 0.06 per cent.
In Europe the stocks stayed lower while investors awaited the outcome of the euro zone meeting. The EURO STOXX 50 declined by 0.48 per cent, the French CAC 40 by 0.30 per cent and the German DAX 30 lost 0,44 per cent.
Slightly more volume in the currencies in overnight session after a quiet day yesterday with US dollar undoing some of its gains from the past days ahead of a string of US data to be released later this week. The EUR was up 0.2 per cent against the USD. The USD declined against the JPY in the overnight session, however its thought the Yen has some way to go in its downwards trend. The pair touched 101.27. The AUD was up against the USD too today on profit locking by investors. The pair reached 1.0004 in the late part of Asian trading, a gain of 0.26 per cent. The dollar also fell against the British pound with a 0.15 per cent decline.
The weakening dollar pushed investors to buy the better priced commodities like gold and silver which both gained, gold by 0.45 per cent and Silver by 0.05 per cent. Natural gas finally rallied with an 0.13 per cent increase as colder weather is expected in some parts of the US and North Europe. Crude oil rose by 0.32 per cent at time of writing.
Watch out for a string of European data today which should extend gains in the EUR, also keep eyes open for ZEW economic sentiment .
BinaryOptionStrategy.com – Welcome back to another exciting week in the markets, and today both the dollar and the Nikkei 225 have opened with nice gains in the Asian session. This follows the BOJ’s announcement that the Japanese M2 money supply moved up 3.3 per cent in April to 844.5 trillion Yen. This beats expectations of 3.1 per cent. M2 quantifies the amount of money circulating in a specific country while M3 quantifies the total supply of money including assets and deposits. The M3 money supply in Japan gained 2.6 per cent last month too, to 1,142.0 trillion Yen which beat the expected 2.5 per cent.
We saw some key data to come out of China which included retail sales, industrial production and fixed asset investment which investors were waiting for. Industrial production figures in China gained 9.3 per cent for last month which comes below the expected 9.5 per cent gain and follows on from March’s 8.9 per cent gain. Retail Sales gained 12.8 per cent last month which falls in line with targets.
Other investors are cashing in profits from commodities made from the stronger dollar.
In Australia a report has been released showing that home loan approvals have gone up by 5.2 per cent in March, surpassing expectations of a 4 per cent increase.
The M2 and M3 money supply data and the Yen falling to its lowest point since 2008, boosted the Nikkei 225 in Japan to new highs not seen since before 2008’s banking crash. The index gained over 1.5 per cent before settling at 1.2. per cent. The Hang Seng in Hong Kong crept down weighed down by raw material producers stocks after the weak Chinese data. Australia’s ASX/S&P 200 index moved downwards after Chinese data release too, pulled down by mining giants BHP Billiton and Rio Tinto.
The USD/JPY hit 102 during the session, its highest point in 4 1/1 years and then eased back down to 101.59 during Asian session, a 0.02 per cent dip. Meanwhile the dollar continued to gain against the other currencies making new highs. The EUR dropped 0.13 per cent against the dollar, the GBP lost 0.09 per cent and the AUD lost 0.37 per cent.
Commodities were down as investors cashed in their gains on the strength of the dollar. Gold lost 0.275 per cent, Silver 0.15 per cent and Crude 0.77 per cent down. While Natural gas continues falling on warm weather forecasts losing 0.325 per cent.
The disappointing Chinese data should lead the European session while stock market futures point to weakened stocks in Europe. The eurozone members are due to meet later today in Brussels. Then later will see the release of US retail sales which are an important driver to the US economy
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In Asian the stocks finally lost some of their gains from the last several days. While the USD keeps weakening the JPY is getting stronger.
In overnight trading, the Central Bank of South Korea cut their interest rate, this comes after cuts in Australia, Europe and India. South Korea dropped its rate a quarter of a percent: from 2.5 per cent to 2.25 per cent. This marks the 1st cut seen there in over seven months. While Japan has been aggressively weakening its JPY which has made exports cheaper, South Korea have been struggling to compete. Exports make up more than 50 per cent of the South Korean economy. The Japanese Yen has shed more than 20 per cent of its value against the dollar. While the Won, which is the South Korean currency has increased in value by almost 9 per cent against the USD and over 20 per cent against the Japanese Yen during that period.
The Nikkei 225 in Japan which had made record gains in yesterday’s session reversed some of those gains to be 0.59 per cent lower. The Kospi Index in South Korea rose 1.18 per cent following the lowering of its benchmark rate. In China the Shanghai Composite lost 0,86 per cent following consumer price data increases of 2.4 per cent for last month and falling producer prices by 2.6 per cent.
While the Australian rate was also cut and the data release showing an addition of 50,100 jobs which flew past expectations by almost 5 times the Australian S&P/ASX 200 was slightly down by 0.03 per cent.
In Europe the stocks stayed high in a low volume session yesterday boosted by German production data and the potential announcement of a further rate cut. Tin the afternoon EURO STOXX 50 climbed 0.43 per cent, the French CAC 40 was up 074 per cent and the German DAX 30 was up 0.65 per cent.
In the US prices closed higher on back of earnings reports and the German data. The Dow Jones closed up 0.32 per cent at 15,105.12, the S&P 500 gained 0.41 per cent to end at 1,632.68 and the Nasdaq gained 0.49 per cent.
In a quiet session for the currencies the USD continued its rough ride as it again declined against most other majors, it was down against the AUD by 0.68 per cent and the YEN by 0.29 per cent. Meanwhile the EUR gained against the USD by 0.03 per cent and the GBP rose 0.04 per cent against the USD.
The price of natural gas continues to fall as weather warms up, in Asian session it dropped 1.13 per cent. The price of crude oil stayed down after release of US supply data and the precious metals were mixed with gold dropping 0.19 per cent and silver up 0.46 per cent.
Watch out for the British pound this morning as industrial and manufacturing figures will come out. It’s expected that the benchmark interest rate in the UK will stay the same. Then in the afternoon keep an eye out for jobless claims in the US.
World Indices and stocks around the globe continue to see gains as positive data comes out of U.S, China and Germany.
The DJIA closed above the 15,000 level and still the Asian stocks keep climbing boosted by bullish US investor sentiment and the positive Chinese data from China. Chinese trade balances numbers show value of $18.16 which easily beat estimates of $15.1. This comes as the Chinese data release which showed growing exports, rose 14.7 in April beating the expected figure of 10.3 per cent.
In Germany factory orders rose 2.2 per cent for March which easily beat expectations of a 0.5 per cent decline. Compared to last year this is a 0.4 per cent fall which nevertheless defied estimations of a 2.9 per cent slump.
All of this news created an investor appetite for risk on investments specifically stocks.
Japans Nikkei 225 continued its rise having passed the 14,000 level and today gaining a further 1.35 per cent buoyed by Japans best performing Asian stocks, which continue their rise past even the highest levels before the financial crisis in 2008. The Hong Kong Hang Seng rose 0.59 per cent and the Shanghai Composite gained 0.49 per cent in overnight session.
In the US the Dow Jones Index crossed the 15,000 level for the first time to close down 0.58 per cent at 15,056.20. While the S&P finished up 0.52 per cent at a record high of 1625.96. The Nasdaq gained 0.11 per cent to 3396.63.
As well as stocks investors had an appetite for the EUR, which saw a gain of 0.28 per cent against the greenback and 0.30 per cent up against the GBP. The USD saw losses in overnight trading sparked by risk on investor sentiment. It fell 0.18 per cent against the JPY and 0.13 per cent against the AUD which was pumped up by the data from China.
The nicely priced commodities also continued to make gains as the dollar weekend. Gold was up 0,45 per cent and Silver 0.51 per cent while Crude oil was up 0,35 per cent. Natural gas further declines on forecasts f better weather dropping 0.61 per cent.
This morning watch out for Industrial Production release in Germany which will be leading the European morning session. Both the EUR and the European Indices are expected to open higher. Stein a member from the Federal Open Market Committee (FOMC), a part of the Fed Reserve System that deal s with policymaking for interest rate numbers and US money supply will be speaking later in the day. Also expect more data from Australia, New Zealand and China in the Asian session
Japans Nikkei 225 sprung up overnight to surpass the 14,000 mark for the first time 5 years. It was fueled by talk on a European Central Bank rate cut as well as the Central Bank in Australia RBA trimming its interest rate. Mario Draghi the head of the ECB yesterday indicated that the central bank intends to try to stimulate the flagging European economy. This sparked speculation around interest rate cuts.
On the other side of the world, the RBA effected a rate cut in the Asian session to a new low of 2.75 per cent from 3 per cent while it trying to curb slowing growth in its mining sector. The health of this sector is inextricably linked to its currency the AUD, a commodity linked currency. The Royal Bank of Australia expects the rate cut to bring in money into its resources sector and also to help buoy other areas of the country’s economy.
In Spain unemployment numbers for down in April with a drop of 46,1000 unemployed. Analysts had expected a rise of 17,100 in the number. Meanwhile in the Spanish service sector the PMI number dropped to 44.4 in April from 45.3 in the previous month underwhelming expected figure of the 45.6. This shows a number well under the 50 level which indicates an economy in expansion.
The Australian Index was boosted on the news with the S&P/ASX 200 gaining 0.1 per cent after rallying form -0.7 per cent. The real rising star of the Asian Indices was the Nikkei which gained to 3.5 per cent before closing at 3.3 per cent. The Hang Seng rose just 0.1 per cent and the Shanghai Composite rose 0.16 per cent.
Yesterday’s Europe session saw European stocks mostly lower on negativity over Europe’s outlook for growth. EURO STOXX 50 was down 0.48 per cent, the French CAC 4- lost 0.32 per cent and the German DAX 30 lost 0.13% in the afternoon session.
US Stocks finished yesterday mostly higher except for the DJIA which closed slightly down by 0,03 per cent, The S&P 500 gained 0.19 per cent and the Nasdaq was up 042 per cent.
The Japanese JPY saw a 0.37 per cent rise against the USD. The USD itself was mixed against the other currencies in a quiet currency trading session. The rate cut in Australia saw the AUD/USD losing 0.57 per cent as the local currency became weakened by making the cost of borrowing cheapened.
The commodities were broadly lower as traders sold their positions with profits to move into higher risk investments. Gold dropped 0.57 per cent, Silver was down 1.54 per cent. Crude oils price reversed wiping out price gains as the commodity dropped 084 per cent. Natural gas too declined as the weather forecasts look warmer for the US and Europe. Copper dropped 0.25 per cent.
It’s to Europe this morning for Germany’s factory orders and to France for Trade Balance then across the pond to the U.S where Treasury Secretary Lew speaks in the afternoon.
The strong jobs data has inspired confidence in investors who are trading risk in markets. Commodities have soared as have the Asian stocks which are moving towards a ten-week high while Crude oil has risen for a third day. This comes in spite of the closure of the Japanese markets for a public holiday; UK is closed today for a bank holiday. Also the markets shrug off the Chinese services PMI data which has dropped to 51.1 for last month from the 54.3 reading in March.
While this figure has declined it’s not too worrying as it still ranks above the 50 mark which is the borderline for an economy in growth. It is however the first time the figure has fallen since 2009 and the recorded new orders is the lowest in nearly 20 months. This comes after last week’s Chinese Manufacturing Purchasing Managers Index which contracted to 50.6 in April from 50.9 in the previous month which also came below the expected reading of 50.7.
Another factor which has pushed up the Asian stocks is the reelection of the Malaysian Prime Minister Najib Razak which has helped boost Malaysian stocks to their highest high of 4 years. Meanwhile the South Korean Kospi rose 0.39 per cent, the Hong Kong Hang Seng gained 0.94 per cent and the Shanghai Composite of China climbed 0.89p per cent inspite of the poor Chinese data. Australian Index S&P/ASX 200 climbed 1.3 per cent aided by mining giants such BHP Biliton.
The dollar continued its descent, although losses were mild with the USDIX which measures the USD against all the other majors down just 0.02 per cent. The only notable currency pair was the AUD against the USD which fell 0.31 per cent after the Australian retail sales report showed a decline of 0.4 per cent for March. The EUR against the USD gained 0.2 per cent and the USD/JPY gained 0.08 per cent in a quiet Asian session.
Commodities were still responding to the Jobs data and the investor appetite for risk on assets with the Gold and Silver both gaining 0.86 per cent and 0.81 per cent respectively. Crude oil meanwhile gained 1.04 per cent and Copper which leapt almost 7 per cent at the end of last week gained 0.06 per cent at time of writing.
It will an interesting day of trading today as the markets respond to the US data of last week . You can expect the European stocks to climb. President of the European Central Bank Mario Draghi will be speaking today and UK and Japanese markets are closed.
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Read the economic events for this week
BinaryOptionStrategy.com – Yet again more soft data to come out of the US yesterday disappointed investors and the markets finally get a chance to react to the weak Chinese PMI data as the Chinese markets finally reopen.
The Fed concluded its two day policy meeting yesterday with a commitment to pursuing its monthly $85 billion asset buying programme. They also commented that they would be able to increase or decrease this amount as required.
Asian stock markets were broadly down during the late Asian session today in response to the China PMI. Investors move away from risky assets like the commodities. One day after the PMI data, China’s purchasing managers data also dropped to 50.4 from 50.5 in March. The USD pushed away from the target 100 JPY level putting pressure on the Japanese export market.
In the US some softer than expected private sector employment and industrial production manufacturing data was released. This caused the stocks to tumble yesterday as investors were unmoved by the Fed’s comments. ADP released nonfarm payrolls which although showed a gain in April of 119,000, this came under expected number of 150,000. This suggests the creation of less jobs and a lower workforce. The number compares to March’s increase to 131,000. Investors see these figures as a taster to the monthly employment release which is due out on Friday. The Institute for Supply Managements factory index fell to 50.7 in April from 51.3 in the previous month.
As discussed over the last few days it’s widely expected that we will see the European Central Bank making interest rate cuts later in the day prompted by high unemployment and low inflation. The rate is currently at an all-time low of 0.75 per cent and would perhaps go down to 0.5 per cent as well as the implementation of new austerity measures.
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Most European markets are closed today for public holidays with the FTSE 100 inching higher in low trading volumes while investors sit on the sidelines to wait out the Fed Reserves policy decisions later today. In the morning the FTSE moved up 0.3 per cent pumped up by mining giants BHP Billioton and Rio Tinto who paid little notice of the Chinese PMI data.
Asian stocks opened the day mixed after the Chinese PMI data release which gave a reading of 50.6, a drop from last month’s 50.9. Although this was under the expected 50.7 it still rises above the 50 target which indicates growth. Most Asian markets are closed today except for Australia with the S&P/ASX 200 which declined by 0.30 per cent on back of weak manufacturing data there and of course Chinese PMI data which affects Australia as its biggest trading partner. NZSE 50 crept down 0.08 per cent . Nikkei in Japan also open today, it closed 0.4 per cent down.
US stocks on talks of Federal Reserve easing measures ended Tuesday up. DJIA closed up 0.14 per cent, the S&P 500 gained 0.25 per cent and the Nasdaq gained 0.66 per cent. Housing and Consumer confidence data beat expectations which helped boost the stocks. The US home price index increased by 9.3 per cent in Feb from the previous. Beating analyst expected figure of 9.0 per cent gain. Meanwhile US consumer confidence smashed he expected reading of 60.8 to come in at 68.1 after Marchs reading of 61.9.
Most investors stayed away from the currency markets waiting for Fed Reserve and ECB meeting outcomes, so little volume of trading. GBP gained a modest 0.07 per cent in overnight against the dollar and was up 0.06 per cent against the euro. The USD is mostly lower against its counterparts today before the results of the Fed Reserve policy meeting. The USD traded at close to 2 week lows against the EUR with the pair up 0.12 per cent to 1.3179. USD/YEN pretty much unmoved ahead of meeting too.
You could hear a pin drop in the commodities markets too with investors perching on the sideline in anticipation for todays’ central bank outcomes. Crude oil made slight falls while traders wait for the stockpile data coming out later today. Crude price for June delivery was trading at $92.74 a barrel in this morning’s session, a marked 0.08 per cent on the previous day. Natural gas was down while investors started taking profits a drop of 1.06 per cent. Thursday marks the release of the US data supply report. It’s expected that increases will be below expectation.
All eyes will be firmly placed on the outcome of both the European Central Bank and the Federal Reserve Meeting later today. Depending on the outcome this should pump some excitement into the otherwise flat trading markets.
In the Asian overnight session trading volume was again low following the string of important data releases from Japan yesterday. The Traders remained cautious waiting for central bank stimulus. Later in the day the U.S. Federal Reserve will be getting together for policy and talk of European Central Bank interest rate cuts fills the investor forum. Some ECB policymakers made comments over the potential cut, suggesting that the bank would consider making cuts if economic releases to continue to look bleak. Italy finally saw the formation of their new government led by PM Enrico Letta who swore to decrease taxes to help stimulate growth.
In Japan unemployment figures fell from 4.3 per cent in Feb to 4.1per cent in March. This surpassed expectation of 4.3 per cent amongst analysts. Household spending in Japan also increased from February with a 5.2 per cent hike from just a 0.8 per cent increase in the previous month. Industrial Production gained 0.2 per cent last month from 0.6 per cent in February underwhelming analyst estimates of 0.4per cent. Retail sales were down in March 0.3 per cent from last year overriding estimates of 0.6 per cent.
The Nikkei 225 was kept in check by the raft of data releases dropping 0.43 per cent an dthen rebounding to 0.09 per cent lower. The Aussie Index S&P/ASX 200 was up 0.78 per cent, boosted by positive profit releases from the Australia & New Zealand Banking Group, which is the 3rd biggest bank in Australia. Another day of holiday celebrations in China while he Hong Kong Hang Seng reopened today up 0.67 per cent.
European stocks were up this morning on the back of the establishment of the new Italian government and the possible ECB rate cut. EURO STOXX 50 was up 0.21 per cent, the French CAC 40 was up 0.11 per cent and the German DAX 30 gained 0.78 per cent,
Pretty quiet night for the currencies overnight with not much movement as traders remained on the sidelines waiting out potential ECB rate cuts. The USD undid some of its declines of yesterday and moved slightly higher against its counterparts. The EUR dropped 0.16 per cent against the USD and the USD/JPY decreased by a slight 0,04 per cent.
The reticence of the investors followed through to the commodities markets with Gold dropping 0.26 per cent and Silver 0.07 per cent as investors took profits from earlier gains. Natural Gas slide 0.18 per cent – as the warmer weather brings lower demand. Crude Oil was 0.24 per cent down on continuing worldwide economic recovery woes.
Important Unemployment figures in Europe to watch out for. If the number goes up this will directly impact the EUR. Meanwhile Gas and Oil inventory supplies will be out in the US today before nighttime Chinese Manufacturing PMI, making today an eventful day with perhaps some good volatility and volume for binary options traders to take advantage of.
Asian markets opened higher today although the Japanese and Chinese exchanges are closed for public holidays which meant a lower trading volume in the session. Sentiment is rife that central banks across the world will heighten monetary easing measures or at least maintain them in their current form. This sentiment was reinforced after the soft GDP data coming from the US last week as well as the troubling employment numbers in the Eurozone, which in France and Spain specifically are at record lows.
The Japanese currency has been successfully weakened by 20 per cent since November thus cheapening the price of exports. The asset buying programme introduced by Bank of Japan has now been approved at the latest G20 meeting. This leads people to believe that the same measures could now be taken in other flailing global economies. Eyes will be placed on the opening of the 2 day Federal Reserve meeting for indications of this nature.
The South Korean Kospi was one of the few Asian exchanges trading lower. It dropped 0.38 per cent. South Korea which is the only nation to speak out against Japan’s monetary measures are Japan’s biggest rival when it comes to exports of cars, products and electronics. The Korean won has gained almost 5 per cent against the yen in Q1 of 2013. A report coming out of South Korea said that if the won rises 10 per cent further against the yen this will cut the local exports by a massive 1.9 per cent in Q2 from the previous year.
During today’s Asian session the Hang Seng in Hong Kong was trading lower by 0.05 per cent while the Australian S&P/ASX 200 was up by 0.60 per cent boosted by rebounding banking shares. The New Zealand NZSE 50 leapt by 0.77 per cent aided by the Bank of New Zealand’s decision to keep the interest rates at a record low of 2.5 per cent, further supported by positive earnings and a rise in M&A activity.
The USD continues its fall against the other majors after the disappointment of the US GDP numbers, the USD no longer a safe haven asset. The EUR was up 14 per cent against the USD, the GBP gained 0.29 per cent against the USD and the USD was up 0.39 per cent against the yen. The USD against the AUD and CAD was down 0.32 per cent and 0.16 per cent respectively. The USDX or dollar index fell 0.21 per cent.
Gold and Silver began a new week up, with 10.06 per cent and 1.85 per cent respectively. Crude oil dropped 0.47 per cent, Natural Gas finally rebounded on warm weather forecasts and the supply issues now behind us.
European session should be a busier one than in Europe with EU economic sentiment data at 9am GMT, this should be watch by binary options traders as it should have an impact on the EUR. Then at 12.30 GMT keep eyes out for Personal Income and Spending in the US. This figure in March slunk to a 9 month low. This number is important for the US which is a nation that is 70 per cent driven by consumer spending.
Commodities continued to rise as investors move away for the safe haven USD and look for higher-yield assets in risk on trading. Meanwhile S Korean economy has grown at its highest level in several years for Q1 even with the tensions between their Northerly neighbor. Economic growth was 0.9 per cent for Q1 as compared with 0.3 per cent for Q4 of last year. South Korea’s gross domestic product stayed at 1.5 per cent although investors had expected a rise of 0.7 per cent. BOJ meeting tomorrow is widely anticipated by investors after announcing the aggressive plan to double up its asset buying program over the next several years. The Bank of Japan will announce its semi annual report which will give indications to inflation and economic outlook. Some believe that this may bring the USD to break through the 100 mark to trade at 110 against the JPY, this would be the highest level for the pair in almost 5 years.
A real mixed bag with the Asian stocks in overnight trading. With two of the main markets closed the Japanese Nikkei 225 gained 0.14 per cent. Some investors expect the Nikkei to attempt the 14,000 level today, this would be a 5 year high for the index which has already gained 60 per cent in the last half year.
The Hang Seng in Hong Kong gained 0.49 per cent and the Shanghai Composite lost 0.77 per cent. Goldman Sachs commented on the current attractiveness of the price of Chinese stocks. Public holidays in both Australia and New Zealand.
Procter & Gamble earnings were lower than expected in Q3 sending its share price down. The consumer manufacturers earnings came in at $20.6 bn for Q3 which is under the expected $20.71.
A good day for Boeing who have a rosy outlook based on their Q1 earnings with earnings for Q1 at $18.89 bn which beats expectations of $18.81. Boeing commented that these strong reports came as a reflection of greater deliveries of the 737 and 777 airplanes.
A good day also for European stocks that closed higher yesterday, although investors sentiments dampened by the negative German business data which only increases expectations that the ECB will cut rates.
The EURO STOXX 50 gained 0.62 per cent in afternoon session, French CAC 40 gained 0.71 per cent and the German DAX 30 was up 0.50 per cent. The German business climate data was at a 4 month lowthis month at 104.4 from 106.7 in the previous month. This comes after other German reports for the manufacturing and service sectors which also show declines for the month of April.
Ahead of the BOJ’s monthly meeting on Friday the US dollar was trading slightly down against the Yen in overnight session. The USD/JPY pair shrunk 0.05 per cent to 99.47. Meanwhile the EUR against the JPY gained 0.19 per cent to 129.79. The dollar is trading lower against most other currencies at time of writing. The EUR/USD was up 0.10 per cent to 1.3031 even with the string of negative euro zone data yesterday. The GBP against the USD leapt 0.35 per cent to 1.5321. The NZD also trading higher against the greenback as investors move away from the USD to currencies yielding higher returns. The NZD/USD gained 0.32 per cent to 0.8505.
There was high volume trading and another day of rises for the commodity markets with gold and silver both firming in US trading and continuing to rise in the Asian session Gold up 1.49% and Silver gaining 1.58%. Crude Oil rose after it was announced yesterday that stockpiles in the US were less than expected. Natural Gas continued to decline on warm weather reports and was 0.42% down
Another busy day of trading ahead with all investor eyes on the UK GDP announcement this morning. An increase is expected which should provide a boost to the UK economy teetering on the brink of a triple dip recession and to the British Pound which has suffered in 2013. Later attention is switched to the US and its key jobless claims driving US trading.
Very weak Purchasing Manger Index data coming out of the world’s second largest economy of China effected the downfall of the Asian stocks after their two-day winning highs.
The Chinese HSBC PMI data for this month fell to 50.5 from last month’s figure of 51.6. February’s figure was 50.4. Although this is a monthly decline it is still nevertheless above the target price of 50 which represents an economy in growth. A number below 50 represents an economy in shrinkage.
New Chinese export orders index fell to 48.6 this month from March’s figure of 50.5. This figure gives analysts the sentiment that we are not yet out of the murky waters. It was only last week that the Gross Domestic Product number for the first quarter was released which showed a gain of 7.7 per cent. This was below analyst expectation of an 8% increase which raised concern over the expansion of the Chinese economy.
In the world’s greatest economy, the US, figures were released that showed that home sales dropped to a seasonally adjusted yearly number of 4.92 million in March, this represents a drop of 0.6 per cent. Despite the fact that analysts had expected a rise in the number of home sales this number is still 10.3 per cent greater than this time last year.
German flash manufacturing PMI release showed a drop to 47.9 this month from 49.0 in March. It was expected that the number would remain unchanged.
Less volume in overnight session from 24 hours ago saw; the Asian stocks decline, on the back of the weak Chinese PMI data and the US home sales numbers. The Nikkei 225 lost 0.32per cent, which was still in the black overall after 2 per cent gains yesterday. The Shanghai Composite shed 2.1per cent and the Hong Kong Hang Seng dropped 1.21 per cent.
European stocks gained today after the German economic data release. During European morning session EURO STOXX 50 was up 0.60 per cent, the French CAC 40 gained 0.84 per cent and the German DAX 30 crept up by 0.01 per cent.
US stocks ended up yesterday. There was high demand in the commodities and therefore in the companies that find them, such as mining, energy and outdoor machinery. The DJIA closed up by 0.14 per cent, the S&P 500 gained by 0.47 per cent and the Nasdaq was up by 0.86 per cent.
Also a low trading volume in the money markets with the JPY the biggest mover. The USD against the JPY lost 0.51per cent as investors moved in for the kill for a nicely priced Yen after weakening brought on by the BOJ. The AUD was down against the Greenback as China is the biggest trade partner of Australia. This knocked the AUD down 0.39 per cent. The Greenback also gained against the EUR 0.2 per cent and against the GBP by 0.21 per cent.
Warmer weather continues to bring the natural gas price down, today losing another 0.28 per cent. On the release of the Chinese PMI data the Crude oil was down by 0.77 per cent. Silver lost 1.10 per cent while gold gained 0.18 per cent.
Lots of European PMI data will be released across Europe and then US data on new home sales and manufacturing activity in a busy days trading.
The YEN dropped to nearly its lowest point in close to 4 years against the USD while the Asian stocks were all up in overnight trading. The commodities were also broadly higher as traders fled the safety of the USD towards well-priced metals like gold and silver.
These moves were buoyed by the Japanese Finance Minister Taro Aso comments that the 2 year plan to double the asset buying fell in line with the G-20 meeting agreements set out in February. Meanwhile the JPY has move around 20 per cent weaker since Nov 2012. This shows success in a scheme which was due to weaken the Yen and make the county’s export prices much more desirable.
The Japanese Nikkei 225 soared to its highest closing price in nearly five years. During the session it gained 2 per cent and then closed at 1.94 per cent up. Biggest mover was Car Manufacturer Nissan whose global sales have made u for almost 80per cent of its total sales. The share price raised 3.8 per cent off the back of a nicely weakened Yen which is helping to boost exports.
In Australia the S&P/ASX 200 gained 0.70 per cent in the Asian session before its national budget due out later today. The S Korean Index added 0.96 per cent as tensions calm down between the neighbours. Meanwhile the only loser in the Asian market was the Shanghai Composite in China which dropped 0.37 per cent after the devastating earthquake shook the share prices.
The Yen was down against all of the other currency’s it’s paired with. The USD/JPY which is getting closer to the 100 target level so desired by the Bank of Japan gained 0.27 per cent to 99.80. The AUD held firm against the Greenback with just a 0.04 per cent raise to take it from its six-week low. Meanwhile the economic outlook for the UK is looking dismal which pushed the GBP down by 0.20 per cent against the EUR. Traders moved away from their USD positions which put it under some pressure.
Precious metals had positive gains as the traders moved away from USD and into commodities. Both gold and silver saw 2 per cent increases. Crude oil crept up by 0.25 per cent boosted by positive market sentiment created from Asian stock rises but Natural Gas lost 1.57per cent as the weather begins to warm across the United States and Europe cuts demand.
Stocks should continue to move upwards in European trading while the US dollar may well come under further pressure. Not much happening on the economic calendar today although US home sales release later today should help the dollar gain.
The Asian stocks and commodities continue plummeting with the Q1 Gross Domestic Product report in China falling below investor expectation. This was a further blow to the markets that were already suffering from the disappointing US retail and consumer data releases on Friday.
GDP in China, the 2nd largest global economy gained 7.7 per cent for the first quarter of 2013 since the same time last year. While this does represent an increase it is still beneath analyst expectation of 8 per cent. Another release which fell below forecast was industrial production figures in China which gained 8.9 per cent in March but still fell short of the 10 per cent expectation. Bad data all round in China with even retail sales disappointing analysts; the figure added 12.4 per cent for the first quarter yet was 2.4 per cent below the figure for the same period last year.
All of this weak data pushed harder against already negative market sentiment over fears for economic growth. This data along with the weak US data as discussed in the weekly analysis has sent analysts running to the safety of the USD.
Asian Stocks all lower on back of China’s data releases. The Japanese Nikkei 225 dropped 0.87 per cent after rebounding slightly from its -1.21 per cent decline. The Hang Seng in Hong Kong lost 1.37per cent and the Shanghai Composite fell 0.64 per cent. The Australian S&P/ASX 200 lost 0.97 per cent as the drop in the commodities plus the fact that China and Australian are the biggest trading partners hit the Australian market.
In Asian overnight trading the USD was still the asset of choice for many investors looking to escape the tumbling commodity markets and falling stocks. The EUR/USD pair drooped by 0.25 per cent while the British pound against the dollar lost 0.1 per cent. The USD gained heavily against the AUD (-0.55per cent) and the CAD (-0.50 per cent) which are both currencies firmly linked to the commodities.
Investors carried on shedding their positions in the commodities with gold losing 3.19 per cent, silver losing 599 per cent. Crude oil was down 2.55 per cent with the announcement of the Venezuelan election results. Caprilles who is the more capitalistic choice lost to Maduro who models himself politically in the model of Chavez.
Not much on the economic calendar today except the trade balances in Europe. Still expect a lot of market volatility with lots of activity for binary options traders.
The number of “jobless claims” claimants across the US last week dropped by 42,000 to 346,000. Analysts were expecting a drop of just 23,000. The release seems to paint a healthier picture of the direction of economic recovery in the labour market, especially after poor US nonfarm payroll figures which came in well below expectations last month. Nonfarm payroll monitors the total no. of paid workers across the US.
Also since the Bank of Japan announced their plans for monetary easing to bring up deflation, this has boosted market sentiment.
Markets remain cautious this morning ahead of the Eurozone finance ministers who will meet to decide whether to extend the bailout loan repayments for Ireland and Portugal. It’s also thought Cyprus will be discussed at the meeting as their bailout has grown from 17.5 billion euros to 23 billion euros. European stocks opened up lower ahead of the meeting.
Asian stocks after an impressive 4 days continue to move mostly higher at the time of writing. All except for the Nikkei 225, which yesterday broke its highest level since 2008 finally fell, losing 0.58 per cent in Asian trading while the USD/JPY also fell. The Hong Kong Hang Seng gained 0.07 per cent and the Shanghai Composite increased by 0.05 per cent. Next week will see the release of a lot of Chinese data including the Q1 GDP figures on Monday and Industrial Production and Retail sales for last month. The Australian S&P/ASX 200 made small gains, mainly as a result of energy giant Woodside that will be giving further capital to shareholders.
US Stocks closed mixed across the board yesterday inspite of the positive jobless claims numbers from US which beat expectation and the news from the Bank of Japan regarding easing plans. The technical stocks weighed heavy on the US stock market. The Dow Jones closed up 0.42 per cent, the S&P 500 gained 0.36 per cent and the Nasdaq was up by 0.09 per cent.
European stocks were down at the start of the European session in advance of a meeting of Eurozone policymakers later today. The EURO STOXX 50 was down 56per cent, the French CAC 40 lost 0.37 per cent and the German DAX 30 declined by 0.59 per cent.
The EUR held firm against the USD today, floating around the 6-week high ahead of the Eurozone meeting later today. While the positive jobless data from the US buoyed the USD. The EUR/USD touched the high of 1.3127 in overnight trading. The greenback was trading lower against the Yen in overnight trading following a data release form Japan showing an increase in tertiary index report for Feb. This figure showed that the industry sector index has risen by 1.1 per cent in Feb exceeding expectation of 0.7 per cent. Gainers in the sector include trade, finance, communication and finance. Education and transportation were two areas of the index that fell. The USD/JPY lost 0.22 per cent to trade at 99.46 in overnight trading.
Oil prices fell in Asian trading losing 0.11 per cent to trade at $93.41 per barrel. Meanwhile natural gas almost met its 20 week high yesterday. It gained 0.82 per cent to trade at $4.119 per BTMU. Gold was down in overnight trading losing 0.26 per cent to $1,580.65 per troy ounce before rebounding up 0.30 per cent to trade at $1,590,05.
Fourth day winning streak for the Asian stocks in overnight trading as the promise of both Japanese and now US stimulus measures as promised yesterday boosting market sentiment and keeping traders appetites open for the more risky assets.
Data releases from Japan indicate that the M2 Money Stock gained 3per cent in March which is a 0.01 per cent gain from the month before. This surpassed expectations of 2.9 per cent. Another Japanese report released yesterday by the Economic and Social Research Institute was the core machinery orders which had gained 7.5 per cent in March after they fell 13.1 per cent in the previous month. Expectations had been of a 6.8 per cent increase.
Asian stocks were also bolstered by President Obama’s new 3.77 trillion dollar budget that he unveiled yesterday. The budget will be a Robin Hood tax on the wealthy and will also cut state benefit packages. The investors have priced in the strong possibility that Obama will not get most of his suggestions fulfilled by congress.
The US Federal Reserve is pumping $85 billion into the economy with an asset buying program of mortgage debt and treasury holdings. This will bring down the interest rate and fill the market with liquidity which in turn will weaken the USD, make exports cheaper and push up stock prices at the same time until the Fed decides to wind the stimulus program of quantitative easing up.
A day of bearish markets in the Asian stocks overnight session with the Nikkei 225 gaining 1.27 per cent to hit its highest point since Jul 2008. The Hong Kong Hang Seng rose 0.84 per cent and the Shanghai Composite ‘inched up 0.02 per cent. Meanwhile the Australian ASX 200 gathered nearly 1 per cent after the release of data there indicating an unemployment rate gain of 5.6 per cent last month from 5.4 per cent in the previous month.
European stocks also moving up, by late afternoon European session EURO STOXX 50 jumped up 1.44 per cent, the French CAC 40 up 1.21 per cent and the German DAX 30 up 1.17 per cent. European markets boosted on the back of the rather suspect Chinese trade surplus data.
US stocks also gained on Wednesday ahead of positive expectations of Q4 earnings. Meanwhile the Federal Reserve used optimistic language regarding the forecast of the economy which also helped the US stocks. By end of trading the DJIA closed up 0.88 per cent, the S&P 500 gained 1.22 per cent and the Nasdaq 1.83 per cent.
A fairly quiet session for the currencies where the AUD/USD stood out as it dropped 0.23 per cent following on from the unemployment data in Australia. The overall investor push away from the currencies to the riskier assets meant very little movement with the currencies. Yen getting nearer to its 100 point against the dollar. The pair touched 99.61 in late Asian session.
High volume of commodity trading in the markets with gold pushed down by 0.03 per cent and silver down 0.81 per cent. Opec released data showing that oil production is down which would normally boost the price however negative sentiment on worldwide economic growth kept the price down 0.27 per cent in overnight trading.
Busy overnight session with lots of volatility. The Nikkei 225 continued its upwards trend towards its 5 year high. On the other side, the Japanese Yen had fallen to its lowest point since 2008. This came before the Chinese PPI data release from the National Bureau of Statistics which shows that the nations PPI declined 1.9 per cent in Mar as compared to the previous year. This comes after a 1.6 per cent drop in Feb. Analysts had estimated a 2per cent fall. Meanwhile China’s CPI dropped to-0.9 per cent which was a harder fall than investor expectation of -0.6per cent. The CPI had risen 2.1 per cent since the same time last year which underwhelmed analyst expectations of 2.4 per cent gain. The Chinese data and the BOJ’s first government bond buying program, whereby 1.2 trillion Yen of debt was sold had the effect of pushing up the Yen and pushing down the Nikkei 225.
A good trading session for the Asian stocks which gained on the back of the Chinese data and the action taken by the BOJ before rallying on the actions of profit-takers. The Australian S&P/ASX200 saw a 1 per cent gain as it was boosted by the mining corporations that gained on Chinese data eg. BHP Billiton and Rio Tinto. The South Korean Kospi kept its freefall with a further0.35 per cent loss after North Korean announced their plans to test their nuclear weapons for the 4th time. The Hang Seng was up by 1 per cent during late Asian session and the Nikkei hit a new 5 year high earlier in the Asian session.
European stocks were up today boosted by the Bank of Japans new heavy bond buying program. EURO STOXX 50 was up 0.63 per cent, the French CAC 40 was up 0.53 per cent and the German DAX 30 was up 0.50 per cent.
The data from China pushed the AUD/USD pair up with a 0.19 per cent gain. The Australian dollar is linked to the commodities so that when there is a positive demand for commodities this pushes up the value of the AUD currency.
It was confirmed yesterday that the Chinese renminbi will start trading against the AUD later in the wee which means that the Chinese currency will now be traded only against the AUD, JPY and the USD. The EUR was up against its counterparts, even with continuing concerns from the Portuguese and Greek banking sector. The euro saw a 0.24 per cent increase against the dollar.
The weaker dollar helped boost the commodity markets by pushing investors to find a safe haven asset. Crude oil was up 0.38 per cent after the data from China and the BOJ government bond buying begins. Gold gained 0.23 per cent and silver gained 0.83 per cent boosted by a healthier global outlook with the Japanese stimulus measures. Natural gas still rising with a further gain of 0.12 per cent with gold weather reports out of US. Natural gas has reached a new 20-month high.
The markets opened with strong reactions to the disappointing US jobs data release on Friday and to the new stimulus measures in Japan. The reaction to these aggressive measures has clearly gone down well with market players as the Yen continues to weaken. It’s now at its weakest level since 2008. The new governor of the Bank of Japan Haruhiko Kuroda has been praised for his insight into the global markets reaction to his policy.
An announcement from the Prime Minister of Portugal, Pedro Passos Coelho who has stressed that the country will have to cut its spending which will form part of the bailout package that was received in 2011. The constitutional court in Portugal on Friday rules out this years budget which would include tax hikes. This would have made up for the 1.4 billion euro shortfall.
The Nikkei 225 in Japan gained 2.51 per cent in overnight trading. This is the indexes highest point since 2008. The Shanghai Composite which dropped 1.72 per cent, didn’t do so well as talk of bird flu damaged the Chinese stocks. The Hong Kong markets also suffered from bird flu talk with the Hang Seng losing 0.24 per cent. Tensions continue to mount in Korea which affected the South Korean Kospi by shedding 0.18 per cent.
While the Yen is weakened the USD/JPY pair continue their flight with a 1.00per cent gain in overnight trading. The JPY lost over 3 per cent against the dollar towards the end of last week after BOJ stimulus measure announcements. Other than that little movement in the currency markets. The USD was slightly up against its major counterparts, with some recovery from last weeks’ losses. The USDX which is the dollar index that measures the USD against 6 other majors gained 0.21 per cent.
The stronger dollar didn’t have an effect on weakening the commodities as is usual as most commodities gained. Silver was the exception, it lost 0.08 per cent on the back of profit taking. Meanwhile gold added 0.07 per cent and Crude oil climbed 0.19 per cent as investors bought these safe haven assets at nice prices. Natural gas continues its rise with 0.21 per cent gain following bad weather reported in the US.
Ben Bernanke Chairman of the Federal reserve will be speaking later today which usually affects the USD. Not many economic events today although markets will continue to react to last weeks jobs data and the news from Portugal.
The Bank of Japan 2-day policy meeting is over and the results are eagerly awaited to find out if there will be an aid to Japan’s troubling financial situation. Japan has been suffering from a very strong currency and as a result its exports have been very expensive. The results of the meeting: Haruhiko Kuroda the Governor of the Bank of Japan will as expected implement a host of measures to stimulate the economy. Firstly the Bank will trump up an asset buying program with the intention to meet an inflation rate of 2% within the next 2 years. The BOJ will also purchase longer term government bonds and double its acquisition of ETF’s and longer term bonds. Governor Kuroda was nominated by the Prime Minister Shinzo Abe (himself newly appointed in his position) as the PM had been outspoken about the need for the BOJ to offer further aid to the Japanese economy. This prompted the Yen to get weaker by 1.5 per cent against the USD.
Jobs data to come out from the US yesterday not so positive. Less jobs were created in March than previously expected. 158,000 new jobs were created which falls well short of the 197,000 expected new jobs.
The Japanese stock market wiped out its earlier session losses after the conclusion of the BOJ policy meeting. The Asian stocks jumped higher in response to news about the BOJ’s plans to flood the market with money and hence devalue the currency. The Nikkei 225 which throughout the session was mostly lower gained 2.2 per cent. Hong Kong and China’s Indexes closed for a public holiday.
Worsening tensions between North and South Korea pushed down the other Asian markets with the Kospi sliding 1.84 per cent down as traders escape their S. Korean assets. Australian ASX 200 dropped too even with positive retail sales data from the region which gained 1.3 per cent in Feb which exceed expectations of 0.9per cent gains.
European stocks yesterday closed mostly lower with investors remaining cautious around events in Cyprus and the repercussions for the rest of Europe. The EURO STOXX 50 descended 0.79 per cent in late afternoon session, French CAC 40 lost 0.54 per cent and the German DAX 30 lost 0.27 per cent.
US stocks were lower yesterday in the US session after the jobs data missed its mark. By the session end the DJIA which had reached another record high the day before had closed down 0.76 per cent, the S&P 500 dropped 1.05 per cent and the Nasdaq finished 1.11 per cent down.
The currency market not swinging much with the only real currency pair to stand out the USD/JPY after the BOJ meeting results. The pair gained 1.54 per cent. While the currency in Japan the worlds second largest economy will be devalued this will have the opposite effect on the stocks as you can see from this morning’s numbers. The AUD/USD was the other pair to show any kind of movement with the pair declining 0.20 per cent on the back of tis retail sales data.
The crude oil carried on its decline in overnight trading with 1 per cent loss of inventory supply. This caused the price to lose 0.05 per cent this morning to trade at $94.40. Gold is still on its way down having breached certain technical levels that indicated a further demise. The price at time of writing is down 0.03 per cent. Copper hit a seven-month low with a 0.54 per cent drop on the back of the disappointing US jobs data.
The British pound to watch today as Purchasing Managers Index data to be released in the UK followed by a press meeting with the Bank of England. No dramatic announcement expected. The European Central Banks is thought to leave its interest rates untouched today. The n attention moves to the US with jobless claims release.
Very strong data coming out of China and the anticipation of the Bank of Japan policy meeting on Thursday have fueled trading volume in Asia. It has also taken the Asian stocks too new heights. Yesterday was a strong trading session in the US where the DJIA and S&P reached record highs.
The turnaround yesterday came after data releases from US dept. Commerce that new orders for manufactured products gained 3 per cent in Feb which exceeded market estimations. This data led by positive orders from car companies Ford, GM and Chrysler, further helped buoy the shares into the uptrend. The Dow has now firmly recovered and even doubled from the damage it suffered during the heart of the financial crisis.
The PMI in China for the service sector went up to 55.6 last month from 54.5 in Feb. A positive number which far exceeds the 50 number which is the threshold for positive growth. The figure was helped along by growing construction activity with the construction index rising to 62.5 point in March which is a rise of 4.5 from the month before.
High volume of trading in overnight Asian session with the Asian indexes mixed to higher. The Japanese index Nikkei 225 shone with a rise of 3per cent per cent ahead of the BOJ meeting on monetary policy. The Shanghai Composite rose 0.05 per cent pushed by the positive Chinese PMI data. The South Korean Kospi index fell further overnight as political tensions seem to get worse between North and South Korea everyday.
The DJIA gained 89 points yesterday and reached a high of 14,684 and closed at 14,662. This exceeded the last high which was reached last month, 14,285. The current number more than doubles the level reached by the Dow at its worst point in March 2009. The S&P also finished at a record high yesterday as it touched 1,570.
Currency market was a whole different story yesterday with very low activity seen in the Asian session. The British pound continued on a slightly bullish trend last night following on from its beating in the European session. The GBP fell 0.04 per cent against the EUR and 0.12 per cent against the dollar. The USD was broadly higher in Asian session, with 0.09 per cent gains against the EUR and 0.11 per cent against the Japanese Yen ahead of the BOJ meeting which will see the new governor Kuroda presiding.
A strengthening USD pushed the metals prices down with gold losing 0.54 per cent and silver losing 0.99 per cent. Meanwhile crude lost 0.55 per cent as investors speculated that Wednesday supply data would reveal a surprising rise in inventory.
All markets reopened after the Easter holidays to a mixed bag. Weak manufacturing data came from the US as the ISM Index for last month fell to 51.3 from 54.2 in Feb. Although this was below expectations that the index would stay unchanged it’s not a concern as it is still over the 50 threshold which is an indication of a growing economy. Meanwhile support for the JPY ahead of new BOJ Governor Kuroda’s first assembly to cover Japanese Monetary policy.
Pessimistic data all round coming out of the Eurozone is building a bleak picture of regions outlook for Q1. Data releases demonstrated an unemployment rate of 12 per cent for Feb, this is a record high for unemployment in the region build of 17 nations.
German PMI fell below the 50 mark to 49 last month down from 50.3 in Feb. The European Central Bank is not expected to make any changes following the policy meeting on Thursday although President Draghis’ comments are heavily anticipated by market participants.
The Japanese Nikkei 225 index dropped by 1.06 per cent in Asian trading offset by the strengthening JPY. The Australian ASX 200 Index rose 0.38 per cent ahead of the RBA meeting there where there sentiment favors a satisfactory outcome to rate cuts that have been taking place since 2011. The Hang Seng gained slightly by 0.06 per cent and the Shanghai Composite was up by 0.58 per cent.
Not much movement in the money markets with only two pairs showing some movement. The AUD/USD gained 0.38 per cent this morning, provoked by the Reserve Bank of Australia meeting later in the week. The USD/JOY was the other pair making waves today when it shed 0.48 per cent ahead of the BOJ policy meeting tomorrow. This will be the first time Haruhiko Kuroda, the new Governor will be presiding over the meeting. Kuroda is known for his very aggressive stance towards easing measures in Japan. The dollar dropped slightly against its other counterparts with the greenback losing 0.04 per cent against the EUR and 0.14 per cent against the Canadian dollar.
Gold was benefiting from the weaker dollar by trading slightly higher in overnight session with a gain of 0.05 per cent furthering the slight upwards trend as seen on Mondays US trading session. Silver too was taking advantage of the weakened USD by trading 0.12 per cent higher. Copper was unmoved. The biggest mover of the commodities though was Crude oil which lost 0.38 per cent of its price. This was pushed by mixed data releases coming out of the US. Natural Gas prices finally rallied as weather forecasts from US and Europe start to show better weather.
Traders stretching their muscles today after an extended Easter holiday. Figures to come out of Italy, Spain and Eurozone unemployment and Purchasing Managers Index from Europe. Then focus moves across to the US with releases of Oil and Gas supplies which are expected to fall.
Investors jittery over Cyprus and Italy. Italian leader Pier Luigi Bersani unable to create a coalition government after talks on Wednesday with rival leaders finished with no agreement. He made the markets jittery with his comment that only an “insane person” would now want to run Italy.
The European Commission meanwhile released figures for its economic sentiment indicator which showed a fall from 91.1 last month to 90.0 in March. Investors had anticipated a drop to just 90.4
Cyprus banks to reopen today after 2 weeks of closure. The banks have been heavily guarded by police and GS4 ahead of the opening. To control savers making runs on the banks, the banks have incorporated rigid controls once the banks open including maximum withdrawals of 300 Euros and they have banned all cheques.
Retails sales data from Japan was very poor with the figure dropping to -2.3 per cent from this time last year and dropping by -1.1 since January. Investors had expected a slight fall of -1.2 per cent.
Asian stocks mostly lower as consumer sentiment drops with pessimism from retail data in Japan, chaos with capital measures in Cyprus and a downgrade of the growth outlook for South Korea. The Japanese Nikkei 225 declined by 1.56 per cent as the USDJPY also declined. Biggest losers were car manufacturing and banks. The Hang Seng in Hong Kong dropped by 1.05 per cent and the Shangahi Composite shed 2.27 per cent. This came after China’s lawmakers revealed new measures to control wealth management products sold by Chinese Banks which introduces unknown risky elements in the banking sector. Australian ASX 200 dropped 0.30 per cent following the RBA announcement that the private sector credit in the country which gained by 2 per cent (same as the previous months reading) was below analyst expectations of a 0.3 per cent rise.
European stocks inched higher today in European session even while concerns are rife over Cyprus banks reopening and over political stalemate in Italy. The EURO STOXX 50 gained by 0.19 per cent, the French CAC 40 also added a little with a 0.13 per cent increase and the German DAX 30 gained 0.21 per cent.
US stocks closed down yesterday as traders moved away from the risky assets like stocks. The DJIA closed down 0.23 per cent , the S&P 500 was down 0.06 per cent and the NASDAQ ended p 0.12 per cent.
The USD was down against the JPY today as the USD/JPY stay in a narrow range as investors await the announcements from the next BOJ meeting minutes. The pair touched 93.99 in overnight trading which was the lowest level for the pair in 3 days. The dollar is expected to hold steady against the YEN at near 3 year highs as market participants continue to expect tighter easing policies from the Bank of Japan. The Banks Governor Kuroda commented at the beginning of the week that Japan’s lawmakers would perhaps do away with a law that minimizes the banks’ ability to purchase government bonds.
The JPY was up against the EUR while the EUR is put under pressure by Italy and Cyprus concerns, with the pair creeping down by 0.08 per cent to hit 120.60. The single currency was up against the greenback today after German retail sales data surprised analysts. The figure which had been expected to decline to -1.0 per cent instead rose to 0.4 per cent. The EUR/USD pair were up 0.20 per cent in European early session to 1.2806. The EUR dropped against the GBP though with the EUR/GBP losing 0.02 per cent and touching 0.8446.
Gold moved slightly lower today although gold may become a safe haven asset for investors later in the day as they move away from jittery currencies and stocks. The precious metal declined 0.13 per cent. Oil was slightly up in overnight session regaining Wednesday’s losses. The commodity gained 0.10 per cent to trade at $96.67. Supplies of the oil far exceeded analyst expectations. Natural gas meanwhile was almost at 1 ½ year highs yesterday as temperature forecasts for the beginning of April will be colder than normal for this time of the year.
The US will release the weekly initial Jobless Claims numbers and revised figures on Q4 economic growth.
A positive day for European stocks yesterday, buoyed by optimistic investor confidence around the new Cyprus deal. The only thing that managed to soften the sentiment were comments made by the head of the Eurogroup Jeroen Dijsselbloem. He said that the bailout plan received by Cyprus is the first of a new type of rescue plan to deal with banking crises in the Eurozone and just like Cyprus other countries need to think about the restructure of their banks. Later on in his comments, he seemed to go back on what he’d said, mentioning Cyprus was a specific case with its own exceptional challenges.
“Cyprus is a specific case with exceptional challenges which required the bail-in measures we have agreed upon yesterday,” “Macro-economic adjustment programmes are tailor-made to the situation of the country concerned and no models or templates are used.”
This morning the EURO STOXX 50 inched up by 0.23 per cent, the French CAC rose by 0.53 per cent and the German DAX 30 gained 0.26 per cent.
Stocks in the US closed down yesterday after optimism over the Cyprus deal wore off as investors came to terms with what the deal means for both the depositors and the bondholders. By the end of US session SJIA was down 0.44 per cent, the S&P 500 closed down by 0.33 per cent and the NASDAQ was down 0.30 per cent.
Asian stocks in overnight trading were lower following from Dutch Finance Minister Jeroen Dijsselboems comments that the Cyprus deal could be a template for other nations. The Nikkei 225 dropped 0.24 per cent. This came despite the BOJ’s release for corporate service price indices which suprassed expectations. The CSPI rose 0.1 per cent last month which beat expectations of no change. The figure int eh previous month was -0.2 per cent.
The Hang Seng shed 0.54 per cent and the Shanghai Composite lost 1.52 per cent. The Australian ASX200 lost 0.7 per cent.
Greenback was holding firm against its other major counterparts this morning with the EURUSD adding 0.19 per cent to 1.2878. The EUR was supported by the fact that a deal was finally reached in Cyprus. The dollar was also firm against the GBP with the GBPUSD pair creeping up just 0.02 per cent to 1.5182. The USD held steady against the JPY and the CHF with the USDJPY creeping up 0.06 per cent to 94.10 and the Swissie losing just 0.03 per cent to 0.9483. The USDCAD was down 0.07 per cent to 1.0206, AUDUSD crept up by 0.11 per cent to 1.0475 and NZDUSD added just 0.1 per cent to 0.8350. EURGBP was almost unmoved with a slight addition of 0.08 per cent, where there pair touched 0.8475.
Crude oil was up this morning, with May futures prices at $94.98 a barrel. Gold was trading slightly lower in early Asian trading, Gold for June delivery was priced at $1605.15 which is a 0.08 per cent gain.
Later today in the US expect durable goods orders and new home sales aswell as consumer confidence. Check out the economic calendar.