CFD Markets News and Forecasts — 12-10-2012

The euro rose for a second day against the dollar on speculation that Spain is close to what will request financial assistance. Also, the euro rose as the EU statistical office in Luxembourg said that industrial production in the eurozone unexpectedly increased in August by 0.6%.

Later, the single currency fell as Reuters reported that the European Stability Mechanism is not enough money to rescue Spain if the country asks for help before the end of the year. However, analysts say that the fund has the right to collect the money from the sale of fixed income securities.

Dollar rose after the published data showed that consumer sentiment index jumped to 83.1 from the final level of the value in September - 78.3. As it became known, the October index is the highest since September 2007.

The Australian dollar fell against all 16 most-traded currencies amid falling stock markets in the U.S. and Europe.

The yen fell against the dollar amid signs of U.S. economic recovery, reducing demand for safe-haven.

European stocks declined for the fourth time in five days as International Monetary Fund Managing Director Christine Lagarde said global growth is not fast enough to curb unemployment, and Chinese new lending missed estimates, outweighing better-than-expected U.S. consumer confidence data.

Akzo Nobel NV (AKZA) slid 6.1 percent as Chief Executive Officer Ton Buechner extended his leave from the company. MAN SE (MAN) fell 3.3 percent after it said 2013 will be tougher than this year. Standard Chartered Plc and Axa SA (CS) climbed as Deutsche Bank AG raised its rating for the banking and insurance sectors.

The Stoxx Europe 600 Index fell 0.5 percent to 269.43 at the close of trading. The measure lost 1.7 percent this week as the International Monetary Fund cut its global growth forecasts and European Union leaders met to discuss the region’s debt crisis.

Stocks briefly pared losses after data showed confidence among U.S. consumers unexpectedly jumped in October to the highest level since before the recession began five years ago.

National benchmark indexes fell in 13 of the 18 western European (SXXP) markets.

FTSE 100 5,803.64 -26.11 -0.45% CAC 40 3,399.21 -14.51 -0.43% DAX 7,251.42 -30.28 -0.42%

Akzo Nobel, the world’s largest paint maker, fell 6.1 percent to 42.08 euros, its biggest drop in more than a year. The company’s supervisory board will meet on Oct. 17 to discuss the health situation of Buechner, who took leave last month, citing fatigue, and was expected to return in the first half of October.

MAN fell 3.3 percent to 75 euros. The truckmaker controlled by Volkswagen AG (VOW) said next year will be tougher than 2012 as orders in the third quarter fell more than normal for the season.

Spectris Plc (SXS), a maker of production-testing gears, slid the most in more than a year, falling 6.7 percent to 1,549 pence after sector peer Morgan Crucible Co. said it will shut down plants in Europe to offset a greater-than-expected drop in revenue.

Lanxess AG (LXS), a German chemical maker, retreated 4.4 percent to 60.21 euros. Credit Suisse Group AG downgraded the stock to underperform, similar to a sell rating, from neutral.

Saipem SpA (SPM), the Milan-based oil services contractor, declined 5.6 percent to 35.21 euros. The stock was cut to neutral from buy at Nomura Holdings Inc.

Swedbank AB (SWEDA) dropped 2.6 percent to 119.90 kronor. The stock was cut to hold from buy at Deutsche Bank.

Software AG (SOW), the German infrastructure software provider, surged 12 percent, the most in a year, to 30.35 euros after it confirmed its full-year forecast and said it expects growth in license sales to continue in the fourth-quarter.

Coca-Cola Hellenic Bottling Co. (EEEK) advanced 7 percent to 16.75 euros. The stock was upgraded to overweight, meaning investors should buy the shares, from neutral at JPMorgan after it announced plans yesterday to move its main stock listing from Athens to London.

• Fundamental growth prospects of the U.S. economy in the long term is still promising

• It is expected that the confidence of households will gradually rise

• Rather, economic growth will accelerate later next year

• Political deadlock paralyzing uncertainty creates

• The recession has forced consumers to be more cautious in spending

• Investment in the housing market is still low compared to historical norms

• The housing market is showing some encouraging signs

• Would prefer to buy Treasury bonds and mortgage-backed securities are not

• The housing market is still faced with excess inventories of homes

• Reducing unemployment frustratingly slow

• Economic recovery is "pretty weak"

• The benefits of bond purchases is likely to be small

• I agree with the decision of the Committee on the Open Market of to keep interest rates near zero

Oil prices rose slightly and gradually sent to its first weekly gain in the last month, since the increase of tension in the Middle East have prompted fears that the supply violated. Also on this momentum influenced presented U.S. consumer confidence index, which unexpectedly rose in October to a five-year maximum.

Earlier, prices rose by 0.6%, as the countries of the European Union reached a preliminary decision to tighten sanctions against Siriii. Note that the tension in the Middle East, of course, a factor that should keep the price of oil above $ 85 and close at $ 90 a barrel.

European foreign ministers are planning to formally approve the measure at a meeting on October 15 in Luxembourg.

Oil also rose amid higher U.S. stock markets and the euro strengthened against the euro after the EU statistical office said that industrial production in the euro zone rose unexpectedly by 0.6 percent in August.

A strong euro and a weakening of the dollar increases the appeal of oil as an investment alternative.

November futures price of U.S. light crude oil WTI (Light Sweet Crude Oil) is 91.85 per barrel on the New York Mercantile Exchange.

November futures price of North Sea Brent crude oil mixture is 114.53 dollars a barrel on the London Stock Exchange ICE Futures Europe.

The price of gold fell sharply today, it is moving to its biggest weekly decline in two months. But, despite this, the precious metal is still within the 11-month high, and market participants are awaiting the decision of Spain concerning financial assistance.

Recall also that the international rating agency Standard & Poor's downgraded Spain's sovereign debt rating by two notches to BBB + to the level of BBB-.

During the session, gold, which is seen as a hedge against inflation, increased slightly, as investors reacted to the U.S. data on the growth of producer prices in September. But soon the prices returned to their previous level and are now on the way to the largest weekly decline of 0.8%.

Further decline may continue as the market lacks momentum after the introduction of monetary policy adopted by the major central banks, and should support prices in the long term.

At the same time, a recent survey conducted by analysts Reuters, found that the outlook for gold remains upward.

Credit Suisse announced the increase of the average price forecast for 2013 for bullion to $ 1840 per ounce to $ 1720 an ounce. The bank also revised its forecast for silver to $ 33.10 from $ 29.20 per ounce.

Note also that the gold stock ETFs also fell on Thursday for the first time in two weeks, but still close to a record high at around 75.03 million ounces.

October futures price of gold on the COMEX fell $ 07.06 today and now is 1762.1 dollars per ounce.

U.S. stock futures slightly rose as investors weighed earnings from JPMorgan Chase & Co. (JPM) and Wells Fargo & Co. (WFC) ahead of data that may show consumer confidence stayed near the highest level since May.

Global Stocks:

Nikkei  8,534.12 -12.66 -0.15%
Hang Seng 21,136.43 +137.38 +0.65%
Shanghai Composite 2,104.93 +2.06 +0.10%
FTSE  5,813.93 -15.82 -0.27%
CAC  3,404.81 -8.91 -0.26%
DAX 7,271.73 -9.97 -0.14%
Crude oil $92.26 +0,21%
Gold $1773.10 +0.14

Wal-Mart (WMT) upgraded to Buy from Hold at Jefferies  
General Electric (GE) was initiated with a Buy at Deutsche Bank

Data:

09:00 Eurozone Industrial production, (MoM) August +0.6% -0.5% +0.6%

09:00 Eurozone Industrial Production (YoY) August -2.3% -4.1% -2.9%

EUR/USD

Offers    $1.3070/85, $1.3035/40, $1.2990/000 

Bids $1.2905/00, $1.2875/70, $1.2855/45, $1.2820-00

European stocks declined for the fourth time in five days, amid concerns global growth remains weak.

Euro-region industrial production unexpectedly increased for a second month in August, led by rising output in countries from Greece to France.

Output in the 17-member euro area rose 0.6 percent from July, when it increased a revised 0.6 percent, the European Union’s statistics office in Luxembourg said today. Economists had projected a drop of 0.4 percent. From a year ago, output slipped 2.9 percent after a 2.8 percent decline in July.

ASML, Europe’s largest chip-equipment maker, lost 1.3 percent to 40.94 euros. Advanced Micro Devices, the second- largest maker of processors for personal computers, cut its third-quarter revenue forecast, citing weak demand across all product lines in a challenging economic environment.

Standard Chartered gained 2.7 percent to 1,432.5 pence. A gauge of banks was the second-best performer on the Stoxx 600 Europe Index after Deutsche Bank upgraded European lenders and insurance companies to overweight, a recommendation similar to buy. Barclays Plc rose 1.9 percent to 237 pence.

FTSE 100 5,814.94 -14.81 -0.25%

CAC 40 3,398.91 -14.81 -0.43%

DAX 7,251.42 -30.28 -0.42%

Asian stocks rose, with the regional benchmark index headed for its first gain this week, after U.S. jobless claims fell more than estimated and China and Japan agreed to hold talks over a territorial dispute that has disrupted trade.

Nikkei 225 8,534.12 -12.66 -0.15%

S&P/ASX 200 4,486.6 +3.07 +0.07%

Shanghai Composite 2,104.93 +2.06 +0.10%

Toyota Motor Corp., a Japanese carmaker whose sales in China slumped last month after rioters torched dealerships in protests over disputed islands, added 1.3 percent.

China Cosco Holdings Co. climbed 5 percent, leading Chinese shipping companies higher, after haulage rates for commodities rose.

Yesterday the dollar fell against most major currencies, as speculation arose that Spain could ask for help, and the increased demand for Italian bonds, influenced increasing appetite for riskier assets.

The dollar continued to trade down, even after the published data showed that the number of initial claims for unemployment benefits fell to the lowest level in four years. The number of initial claims for unemployment benefits during the week (September 30 - October 6) decreased by 30,000 to 339,000 level. However, this decline is largely due to the fact that one state has not published data.

Earlier, the euro has significantly decreased since the rating agency S & P downgraded Spain's credit rating by two notches, but because it has increased the likelihood that Spain, for financial support, the euro has soared.

The dollar index (DXY), which is used to track the value of the dollar against the currencies of the U.S. partner, fell 0.2% to 79.779.

The Australian dollar strengthened after the published data, according to which it was reported that the number of employed increased by 14,500 people in September, which was almost three times more than the average estimate of economists. At the same time, the unemployment rate rose to 5.4%, reaching its highest level since April 2010.

The euro broke a three-day decline against the yen on speculation regarding the financing of Spain. Note also that the profitability of Spanish 10-year bonds fell to 5.76%.

During the U.S. session, the dollar fell sharply against the yen, after a significant increase in the early afternoon. However, the combination of weak economic performance in Japan, increased pressure on the Bank of Japan in order to soften its monetary policy, as well as the probability of the intervention to the depreciation of the yen is likely to retard the growth of the Japanese currency in the near future.

Asian stocks swung between gains and losses after Standard & Poor’s downgraded Spain’s credit rating and as Japanese machinery makers declined after a report showed orders fell. Utility companies advanced. Companies that do business in Europe dropped after S&P downgraded Spain’s debt rating to one level above junk, citing mounting economic and political risks as the government considers a second bailout.

Nikkei 225 8,546.78 -49.45 -0.58%

S&P/ASX 200 4,483.5 -7.24 -0.16%

Shanghai Composite 2,107.63 -12.31 -0.58%

Esprit Holdings Ltd., a Hong Kong-based clothier that counts Europe as its biggest market, dropped 1.2 percent in Hong Kong.

Fanuc Corp., the world’s largest maker of controls that run machine tools, slipped 2.4 percent in Tokyo.

Lynas Corp. slumped 15 percent in Sydney after a court ruling further delayed the development of its rare-earth refinery in Malaysia.

Kyushu Electric Power Co. climbed 2.3 percent, pacing gains among Japanese utilities.

01:00 Japan BOJ Governor Shirakawa Speaks

Change % Change Last

Oil 92.48 +0.41 +0.45%

Gold 1,769.40 -1.20 -0.07%

Change % Change Last

Nikkei 225 8,546.78 -49.45 -0.58%

S&P/ASX 200 4,483.5 -7.24 -0.16%

Shanghai Composite 2,107.63 -12.31 -0.58%

FTSE 100 5,832.96 +56.25 +0.97%

CAC 40 3,417.28 +51.41 +1.53%

DAX 7,279.42 +74.19 +1.03%  

Dow 13,326.70 -18.27 -0.14%

Nasdaq 3,049.38 -2.40 -0.08%

S&P 500 1,432.88 +0.32 +0.02% 

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

EUR/USD $1,2929 +0,60%

GBP/USD $1,6046 +0,28%

USD/CHF Chf0,9346 -0,48%

USD/JPY Y78,39 +0,31%

EUR/JPY Y101,36 +0,92%

GBP/JPY Y125,79 +0,60%

AUD/USD $1,0265 +0,45%

NZD/USD $0,8175 +0,13%

USD/CAD C$0,9784 -0,37%

01:00 Japan BOJ Governor Shirakawa Speaks -

09:00 Eurozone Industrial production, (MoM) August +0.6% -0.5%

09:00 Eurozone Industrial Production (YoY) August -2.3% -4.1%

12:30 U.S. PPI, m/m September +1.7% +0.8%

12:30 U.S. PPI, y/y September +2.0% +1.7%

12:30 U.S. PPI excluding food and energy, m/m September +0.2% +0.2%

12:30 U.S. PPI excluding food and energy, Y/Y September +2.5% +2.5%

13:55 U.S. Reuters/Michigan Consumer Sentiment Index October 78.3 77.9

16:35 U.S. FOMC Member Laker Speaks -

18:00 U.S. Federal budget September -190.5 -4.0