CFD Markets News and Forecasts — 05-12-2012

Today, the euro retreated from a seven-week high against the dollar, as the disappointing results of the Spanish bond auction and weak economic data for the euro zone prompted investors to lock in profits.

Note that the optimism associated with the fact that Greece would receive more financial aid from international lenders are pushing up the euro in recent weeks, but after the increased concerns about Spain, the single currency began to lose ground. In addition, from a technical point of view has increased the probability of falling below the level of the pair $ 1.31.

Analysts say that after reaching a new high of $ 1.3125, the rate began to show weakness, and if the pair will consolidate below $ 1.3094, then we will have confirmation of the technical picture, which points to the decline in the euro / dollar in the short term.

Also exerted pressure on the euro retail sales data for October, which fell sharply (by 1.2%), compared to the previous month (-0.2%). At the same time, the annual rate also fell much more than expected (3.6% compared to -0.8% in September).

Recall also that tomorrow the ECB will announce its decision on the basic interest rate, which is expected to remain unchanged, but the gloomy outlook for the euro zone remains a possibility for further measures to support the economy.

Note also that the limited impact on the U.S. currency was a separate report, which showed that growth in the U.S. service sector grew in November, more than expected in November.

Some strategists say the euro will be reduced, if there are signs that U.S. policy can avoid the so-called "financial cliff", which could boost demand for the dollar.

British pound during the day trading in a narrow range, even though the weak data released today by the service sector, which increased the likelihood that in the 4th quarter, the economy can once again show the decline after the significant growth in the last quarter.

The yen fell today above Y82 to the dollar, as the growth in the Chinese and other Asian stock markets prompted market participants to sell the currency of refuge, and buy riskier assets.

The dollar was also supported against the yen from the Bank of Japan, which was caused by the comments of the Deputy Governor Kiyohiko Nishimura that the central bank is ready to "take appropriate and decisive action" if the economy deviates too far from its base scenario.

European stocks ended the session in positive territory, as China signaled broad political support for economic recovery by allowing insurers to invest more money into the banks and in the promotion of urbanization.

Shares of HSBC Holdings Plc (HSBA) rose 1.24% after the bank agreed to sell its stake in China's Ping An Insurance Co (Group) for $ 9.4 billion. As it became known, the largest bank in Europe by market value to revive profits and increase capital.

Cost Tesco Plc rose by 3.31% percent after the company said it was reviewing the terms of its U.S. business. Aker Solutions ASA shares gained 4.98% after the company said it would increase their margins based on earnings before interest, taxes, depreciation and amortization by 15% by the end of 2017. Aker also said that on the way to achieving its objectives of growth, by 2015 it will support payments from 30 to 50 percent of their net income through dividends or share repurchases.

Stoxx 600 advanced 0.24% to 276.91 at the close of trading.

FTSE 100 5,892.08 +23.04 +0.39% CAC 40 3,590.5 +10.02 +0.28% DAX 7,454.55 +19.43 +0.26%

Also released today from ADP data showed that the number of people employed in November fell more than expected by experts, thus reaching the level of 118 thousand, compared to 157 thousand in the last month. Another report showed that the level of industrial orders in October rose by 0.8%, while expected to increase by only 0.1%, after increasing by 4.5% last month.

Shares Stagecoach Plc, which owns 49 percent of Virgin Trains, climbed 5.86% to 308.7 pence. It is learned that in the first half pre-tax profit amounted to 124 million pounds ($ 200 million), which was higher than forecast at 114 million pounds. The same time, adjusted earnings per share was 16.8 pence, which also exceeded the average forecast at around 15.5 pence.

Today, for most of trading oil prices were rising, correcting after yesterday's fall. But the situation has changed after the report from the government showed that crude oil inventories fell last week. Given these data, the cost of oil has fallen sharply, updating the yesterday's low.

As we learned from the report of the Ministry of Energy, crude oil inventories in the week ended Nov. 30, fell by 2.4 million barrels, or 0.6%, to the level of 371.8 million barrels, which is 10.8%, compared with last year. Note that analysts expected stocks to decrease by only 1.25 million barrels.

The same time, gasoline inventories rose by 7.9 million barrels, or 3.8%, to 212.1 million barrels, which is 1.3% lower than last year. It was expected that gasoline supplies to increase by 2 million barrels.

Also, the data showed that gasoline demand in the four weeks ended Nov. 30, up 0.1% from a year earlier, and has averaged 8.6 million barrels per day.

Note that the average U.S. refineries operated at 90.6% of the total capacity, which is 2 percentage points higher than the previous week. Analysts had expected the capacity will increase to the level of 89.2%.

In addition, stocks of distillate fuel, which include diesel and heating oil, rose by 3 million barrels and reached the level of 115.1 million barrels, while analysts had expected distillate stocks to increase by only 800,000 barrels.

January futures price of U.S. light crude oil WTI (Light Sweet Crude Oil) fell to 87.90 dollars a barrel on the New York Mercantile Exchange.

January futures price of North Sea petroleum mix of mark Brent fell $ 0.80 to $ 109 per barrel on the London Stock Exchange ICE Futures Europe.

The price of gold continued to fall, updating the yesterday's low, down with below $ 1690, which was caused by a stronger dollar, as well as technical pressure.

Note that the volume of sales increased as prices for the precious metal fell below its 100-day moving average at $ 1,698 an ounce, as well as the breakdown of support at $ 1,690.64 per troy ounce.

Also pressured gold has a "dead end" in talks to avoid the so-called "financial cliff", which is expressed in the tax increases and spending cuts at the beginning of next year.

Analysts note that while the basis for gold strong, especially considering the position of the adaptive Fed, the positive momentum seems to have disappeared for now. They also claim that it is still waiting for a rebound from these levels, although the odds are in favor of a deeper retracement increased, which may be due to "fatigue" of investor fatigue.

We observe today the euro surrendered earlier positions gained against the dollar, as the disappointing results of the Spanish auction and weak economic data for the euro zone prompted investors to lock in profits after recent gains.

Also today, the shares were supported by comments on the background of the new leader of China, who noted that the Chinese government will focus its efforts on stabilizing exports and make their policies more targeted and effective.

In addition, many investors expect the release of the employment in the non-agricultural sector of the U.S., which will be published on Friday, as well as meetings of the Federal Reserve policy makers next week

December futures price of gold on the COMEX is now 1685 an ounce.

The dollar rose against the yen after data showed that the November ISM Non-Manufacturing index in the U.S. rose to 54.7 against 54.2 the previous month and 54.7 forecast. Also, a report showed that U.S. factory orders in October rose 0.8% with a projected increase of 0.1%.

GBP / USD updated intraday low $ 1.6081 after today's statistics showed that in November, employment in the private sector was below forecasts. In November ADP employment in the U.S. was 118 thousand vs. 125 thousand and revised to 157 thousand the previous value.

British Finance Minister George Osborne said that the economy is healthier, and the recovery is gradual and the country is moving in the right direction. Osborne said that the budget deficit will continue to decline, while exports increased by 2 times since 2009. According to him, the economic growth in 2013 will be 1.2%, in 2014 - 2.0%, in 2015 - 2.3% and in 2016 - 2.7%. It should be noted that all the forecasts have been lowered. The budget deficit for this year is 6.9% of GDP, while in 2012-2013. could reach 108 billion pounds, and then decreased to 73 billion pounds in 2015-2016.

U.S. stock futures slightly advanced as China eased restrictions on investing in banks and its new leaders backed urban development.

Global Stocks:

Nikkei  9,468.84 +36.38 +0.39%
Hang Seng 22,270.91 +470.94 +2.16%
Shanghai Composite 2,031.91 +56.76 +2.87%
FTSE  5,879.77 +10.73 +0.18%
CAC  3,586.98 +6.50 +0.18%
DAX 7,446.71 +11.59 +0.16%
Crude oil $88.37 -0.15%
Gold $1700.40 +0.27%

Intel (INTC) was downgraded from Mkt Perform to Underperform at Raymond James.

EUR/USD $1.3025, $1.3030, $1.3095, $1.3125

USD/JPY Y81.30, Y81.50, Y82.00, Y82.20, Y82.75

EUR/JPY Y107.00, Y107.90

GBP/USD $1.6060, $1.6030

EUR/GBP stg0.8100

EUR/SEK Sek6.59

AUD/USD $1.0425, $1.0440, $1.0450, $1.0475, $1.0500

08:50 France Services PMI (finally) November 46.1 46.1 45.8

08:55 Germany Services PMI (finally) November 48.0 48.0 49.7

09:00 Eurozone Services PMI (finally) November 45.7 45.7 46.7

09:30 United Kingdom Purchasing Manager Index Services November 50.6 51.1 50.2

10:00 Eurozone Retail Sales (MoM) October -0.2% -0.1% -1.2%

10:00 Eurozone Retail Sales (YoY) October -0.8% -0.8% -3.6%

12:30 United Kingdom Autumn Forecast Statement December

EUR/USD

Offers    $1.3200, $1.3170/80, $1.3160, $1.3140

Bids   $1.3080/70, $1.3030/25, $1.3000 

Extending fiscal consolidation into 2017-18

Fiscal consolidation on spending/tax 80/20 by 2015

Sees net debt at 77.3% GDP by 2017-18

OBR forecasts net debt 2012-13 on at 74.7%/GDP; 76.8; 79.0; 79.9

Will meet fiscal mandate including APF transfer

Aiming to hit debt goal 2016/17 not 2015/16

UK deficit 2012-13 forecast 6.9%

Deficit seen 6.1% GDP 2013-14

Deficit seen 5.2% in 2014-15

Britain faces deep problems within the country and abroad

Turning back now would be a disaster

Economy will shrink by 0.1% in 2012, the March forecast assumes growth of 0.8%

Economy will grow by 1.2% in 2013, the March of the Office of Budget Responsibility forecast / OBR / anticipated growth of 2.0%

Economy will grow by 2.0% in 2014, the March forecast OBR anticipated an increase of 2.7%

Economy will grow by 2.3% in 2015, the March forecast OBR anticipated growth of 3.0%

OBR expects peak unemployment rate at 8.3% versus 8.7% previously

Gets shoved down to $1.3060, with traders linking main weight in this latest move to UK clearer sales of euro-yen as well as Asian sovereign

sales of euro-dollar. Next support of note seen at $1.30450. Rate currently trades around $1.3069.

European stocks rose for a third day, led by banks and mining companies, after China signaled wider policy support for the economic recovery by allowing insurers to invest more in banks and promoting urbanization.

China will keep macroeconomic policies stable, making adjustments as needed to deal with difficulties, the Communist Party’s Politburo said in its first assessment of the economy under new leader Xi Jinping.

The world’s second-largest economy will expand domestic demand, actively promote urbanization, strengthen real-estate controls and support small business, Xinhua said.

Separately, the China Insurance Regulatory Commission abolished a rule limiting insurance companies’ investments in commercial banks.

HSBC gained 1 percent to 642.6 pence. The bank agreed to sell its stake in China’s Ping An Insurance to Thai billionaire Dhanin Chearavanont for $9.4 billion as Europe’s biggest bank by market value moves to revive profit and boost capital.

UniCredit SpA rose 2.2 percent to 3.84 euros and Commerzbank AG added 2.9 percent to 1.43 euros, as a gauge of European lenders advanced 1 percent.

An index of mining shares posted the best performance among the 19 industry groups in the Stoxx 600. Vedanta Resources climbed 5.3 percent to 1,122 pence, the highest since Nov. 7. Rio Tinto Group and BHP Billiton Ltd. jumped 2.8 percent to 3,217 pence and 2.4 percent to 1,997.5 pence, respectively.

Nokia gained 6.9 percent to 2.70 euros. The Finnish mobile- phone maker unveiled a version of its flagship smartphone for China’s largest wireless carrier, China Mobile Ltd.

FTSE 100 5,880.35 +11.31 +0.19%

CAC 40 3,588.78 +8.30 +0.23%

DAX 7,448.55 +13.43 +0.18%

Germany alloted E3.3115bln of its 2-year benchmark 0.00% Dec 2014 Schatz issue Wednesday at average yield of -0.01% (-0.02%), bid-to-cover 1.9 times (1.9).

The reaction of the Australian dollar on rate cut is weaker than usual

Monetary policy remains effective Australia

The Australian dollar is too high

Intervention in the foreign exchange market would be a very serious step

Intervention would be a departure from tradition

I see signs of recovery in the housing market

It is unlikely that Australia will need to resort to unconventional policy

EUR/USD $1.3025, $1.3030, $1.3095, $1.3125

USD/JPY Y81.30, Y81.50, Y82.00, Y82.20, Y82.75

EUR/JPY Y107.00, Y107.90

GBP/USD $1.6060, $1.6030

EUR/GBP stg0.8100

EUR/SEK Sek6.59

AUD/USD $1.0425, $1.0440, $1.0450, $1.0475, $1.0500

Tesoro sold E4.251bln vs target E3.5bln-E4.5bln

• E2.124bln of 3.75% Oct 2015 Bono, cover 1.999 vs 2.09 previous. Avg yield 3.39% vs 3.62% previous

• E1.004bln of 4.60% July 2019 Obligaciones, cover 2.47. Avg yield 4.669%

• E1.123bln of 5.85% Jan 2022 Obligaciones, cover 2.29 vs 1.88 previous. Avg yield 5.29% vs 5.46% previous

Asian stocks rose, with the regional benchmark index headed for its highest close in seven months, as Chinese banks and insurers surged after a rule limiting insurers’ investments in commercial lenders was abolished and the country’s new leaders pledged to promote “urbanization.”

Nikkei 225 9,468.84 +36.38 +0.39%

S&P/ASX 200 4,520.4 +16.82 +0.37%

Shanghai Composite 2,031.91 +56.76 +2.87%

Industrial & Commercial Bank of China Ltd., the world’s biggest lender, gained 1.4 percent in Hong Kong.

Ping An Insurance Co. jumped 5.1 percent as HSBC Holdings Plc agreed to sell its stake in China’s second-largest insurer for $9.4 billion.

Yesterday the euro approached to a seven-week high against the dollar after Greece announced a better-than-expected conditions for repayment of debt, thus fueling optimism that Athens will continue to receive international assistance to avoid a possible default. Recall that Greece said it will spend 10 billion euros to buy back the bonds at a price that exceeded market expectations. Note that this news has helped to significantly reduce yields of Italian and Spanish bonds below.

The U.S. dollar weakened to a six-week low against a basket of currencies, as the uncertainty associated with the achievement of an agreement on the prevention of spending cuts and tax increases, remains.

Analysts say that the euro will hold the position until the end of the year, but they also warned that the currency could come under selling pressure in 2013 due to the deterioration in the economy in the eurozone.

The British pound fell against the dollar, as the published data from Markit Economics showed that the PMI in the UK construction sector has fallen, dropping while below 50 to 49.3, up from 50.9 in October. Note that analysts expected drop to 50.5.

The dollar index, which tracks the dollar against a basket of six currencies, fell 0.2% to 79.729, approaching with up to a six-week low at 79.612.

Note that the concern about preventing a "financial cliff" in the U.S. caused by the fall in the dollar, even though the currency acts as a safe haven in times of uncertainty. According to analysts, the dollar will remain weak due to the relatively positive developments in the euro area.

The Canadian dollar rose sharply against the U.S. dollar, which was caused by the decision of the Bank of Canada to leave interest rate unchanged.

Australian dollar at the beginning of session slightly declined as the Reserve Bank of Australia said about lowering the rate by 0.25% to reach 3.0. But in spite of this decision, which was expected for many, the exchange rate began to rise sharply. It is learned that this trend was due to the fact that some analysts predicted that the rate would be reduced by 0.5%.

Most Asian stocks fell after U.S. manufacturing unexpectedly shrank and American lawmakers grappled with new budget proposals. Macau casino operators dropped after The Wall Street Journal reported that China has arrested several junket operators.

Nikkei 225 9,432.46 -25.72 -0.27%

S&P/ASX 200 4,503.58 -27.93 -0.62%

Shanghai Composite 1,975.14 +15.38 +0.78%

James Hardie Industries SE, the building materials suppliers that counts the U.S. as its biggest market, slid 1.2 percent in Sydney.

SJM Holdings Ltd., Asia’s biggest casino company, sank 4.9 percent in Hong Kong as Macau gambling revenues last month increased less than analysts estimates.

Olam International Ltd., the commodity supplier targeted by short seller Carson Block, jumped 3.5 percent in Singapore as it seeks to sell as much as $1.25 billion of bonds and warrants.

00:30 Australia Gross Domestic Product (QoQ) Quarter III +0.6% +0.6% +0.5%

00:30 Australia Gross Domestic Product (YoY) Quarter III +3.7% +3.1% +3.1%

01:45 China HSBC Services PMI November 53.5 52.1

07:00 Australia RBA Assist Gov Lowe Speaks -

Change % Change Last

Oil $88.44 -0.06 -0.07%

Gold $1,697.50 +1.70 +0.10%

Change % Change Last

Nikkei 225 9,432.46 -25.72 -0.27%

S&P/ASX 200 4,503.58 -27.93 -0.62%

Shanghai Composite 1,975.14 +15.38 +0.78%

FTSE 100 5,869.04 -2.20 -0.04%

CAC 40 3,580.48 +13.89 +0.39%

DAX 7,435.12 -0.09 0.00%

Dow-13.90 12,951.70 -0.11%

Nasdaq -5.51 2,996.69 -0.18%

S&P -2.42 1,407.04 -0.17% 

(pare/closed(00:00 GMT +02:00)/change, %)

EUR/USD $1,3093 +0,31%

GBP/USD $1,6100 +0,06%

USD/CHF Chf0,9263 +0,09%

USD/JPY Y81,89 -0,42%

EUR/JPY Y107,23 -0,10%

GBP/JPY Y131,86 -0,34%

AUD/USD $1,0470 +0,49%

NZD/USD $0,8236 +0,35%

USD/CAD C$0,9926 -0,24%

00:30 Australia Gross Domestic Product (QoQ) Quarter III +0.6% +0.6% +0.5%

00:30 Australia Gross Domestic Product (YoY) Quarter III +3.7% +3.1% +3.1%

01:45 China HSBC Services PMI November 53.5 52.1

07:00 Australia RBA Assist Gov Lowe Speaks -

08:00 United Kingdom Halifax house price index November -0.7% +0.2%

08:00 United Kingdom Halifax house price index 3m Y/Y November -1.7% -1.9%

08:50 France Services PMI (finally) November 46.1 46.1

08:55 Germany Services PMI (finally) November 48.0 48.0

09:00 Eurozone Services PMI (finally) November 45.7 45.7

09:30 United Kingdom Purchasing Manager Index Services November 50.6 51.1

10:00 Eurozone Retail Sales (MoM) October -0.2% -0.1%

10:00 Eurozone Retail Sales (YoY) October -0.8% -0.8%

12:30 United Kingdom Autumn Forecast Statement December

13:15 U.S. ADP Employment Report November 158 127

13:30 U.S. Nonfarm Productivity, q/q (finally) Quarter III +1.9% +2.7%

15:00 U.S. ISM Non-Manufacturing November 54.2 53.8

15:00 U.S. Factory Orders October +4.8% +0.1%

15:30 U.S. Crude Oil Inventories - -0.3

20:00 New Zealand RBNZ Interest Rate Decision - 2.50% 2.50%

20:00 New Zealand RBNZ Rate Statement -

20:00 New Zealand RBNZ Press Conference -