CFD Markets News and Forecasts — 12-12-2011

• Fitch Sees 0.4% Eurozone GDP Growth Next Yr
• Fitch Sees 1.2% Eurozone GDP Growth In 2013
• Summit Does Little To Ease Pressure on Eurozone Sov Debt

Dow 11,958 -226.48 -1.86%

Nasdaq 2,597 -49.68 -1.88%

S&P 1,230 -25.49 -2.03%

No major U.S. economic date are due Monday, so investors will be looking ahead to reports on retail sales and the Federal Reserve's monetary-policy meeting on Tuesday, producer prices, regional manufacturing activity and industrial production on Thursday and consumer prices on Friday.

In corporate news, Ingersoll-Rand increased its annual dividend for the second time this year, raising the payout 33% to 64 cents a share from 48 cents a share, but shares still lost 2.4%. Diamond Foods tumbled 23% after the company said it would delay its quarterly filing due to an investigation into crop payments to walnut growers, adding that it expects to get a deficiency notice from Nasdaq. The company faces challenges from walnut growers over what are known as momentum payments that could delay the snack maker's planned $2.35 billion acquisition of Pringles from Procter & Gamble, The Wall Street Journal reported.

Goodyear Tire lost 2.6%. Shortages as a result of Thailand's catastrophic flooding earlier this year could spread to the market for aircraft tires as soon as February or March, the company said Friday.

• Sought Modest And Reasonable Safeguards On Financial Services
• Wanted To Make Sure Could Go Further Than EU Rules In Regulating Banks
• Choice Was Treaty With Safeguards, Or No Treaty
• Britain Remains Full Member Of EU
• Membership Of EU Is In National Economic Interest
• Inter-Governmental Agreement Not Without Risks
• Euro Zone Needs To Implement Its Oct 27 Agreement
• IMF Resources Can't Be Used To Support The Euro
• Far More Needs To Be Done To Reassure Bond Investors
• Favors Boosting IMF Resources To Help Countries In Difficulty Around The World

• Sought Modest And Reasonable Safeguards On Financial Services
• Wanted To Make Sure Could Go Further Than EU Rules In Regulating Banks
• Choice Was Treaty With Safeguards, Or No Treaty
• Britain Remains Full Member Of EU
• Membership Of EU Is In National Economic Interest
• Inter-Governmental Agreement Not Without Risks
• Euro Zone Needs To Implement Its Oct 27 Agreement
• IMF Resources Can't Be Used To Support The Euro
• Far More Needs To Be Done To Reassure Bond Investors
• Favors Boosting IMF Resources To Help Countries In Difficulty Around The World

The euro fell  as Moody’s Investors Service said it will review the ratings of European Union nations after last week’s summit failed to produce decisive steps to end the debt crisis.

The dollar and yen strengthened against most of their major counterparts as investors sought safer assets on concern crisis- fighting efforts are failing to stop European borrowing costs from rising.

The agreement offered few new measures and doesn’t diminish the risk of credit-ranking revisions, Moody’s said in its Weekly Credit Outlook. “Our intention as announced in November is to revisit the level and dispersion of ratings during the first quarter of 2012,” the company said.

Standard & Poor’s put the EU’s AAA rating on “creditwatch negative” on Dec. 5 after similar action on 15 of the 17 euro nations, pending the outcome of last week’s summit and the actions of central bankers.

EUR/USD: the pair has fallen in $1,3250 area.

GBP/USD: the pair has shown low in $1.5530 area, returned back above $1,5600 later.

USD/JPY: the pair has grown in Y77.80 area.

EUR/USD 

Offers $1.3360/65, $1.3330/35, $1.3300/05

Bids $1.3250/40, $1.3225/10, $1.3200, $1.3155/45

Resistance 3: Y79.00 (Nov 1 high)

Resistance 2: Y78.30 (Nov 29 high)

Resistance 1: Y77.90 (session high)

Current price: Y77.79

Support 1:Y77.50 (Dec 9 low, МА (200) for Н4)

Support 2:Y77.10 (Dec 8 low)

Support 3:Y76.60 (Nov 18 low)

Resistance 3: Chf0.9500 (Jan 22 high)

Resistance 2: Chf0.9370 (high of March)

Resistance 1: Chf0.9330 (Nov 25 high)

Current price: Chf0.9300

Support 1: Chf0.9260 (low of european session)

Support 2: Chf0.9115 (МА (200) for Н1)

Support 3: Chf0.9180 (Dec 8-9 lows)

Resistance 3: $ 1.5890 (Nov 18 high)

Resistance 3: $ 1.5770/80 (Dec 8 and Nov 30 highs)

Resistance 1: $ 1.5660 (session high)

Current price: $1.5620

Support 1 : $1.5530 (session low, Nov 30 low)

Support 2 : $1.5460 (area of Nov 28-29 lows)

Support 3 : $1.5420   (low of November, support line from May’2010)

Resistance 3: $ 1.3390 (the top border of the down channel from Dec 2)

Resistance 2: $ 1.3320 (intraday high)

Resistance 1: $ 1.3280 (Dec 9 low)

Current price: $1.3264

Support 1 : $1.3250 (session low)

Support 2 : $1.3220/00 (low of November, the bottom border of the down channel from Dec 2, support line from January)

Support 3 : $1.3150   (low of October)

• UK Govt Gave In To "Financial Lobby"
• EU Agreement Does Not Include Measures To Boost Growth
• EU Intergovernmental Agreement Eases Investors' Concerns Over Sovereign Debt

Nikkei 225 8,654 +117.36 +1.37%

Hang Seng 18,555 -31.60 -0.17%

S&P/ASX 4,253 +49.83 +1.19%

Shanghai Composite 2,292 -23.73 -1.02%

00:30 Australia Home Loans October +2.2% +0.2% +0.7%

00:30 Australia Trade Balance October 2.56 2.12 1.60

05:00 Japan Consumer Confidence November 38.6 38.5 38.1

06:00 Japan Prelim Machine Tool Orders, y/y November +26.0% +15.9%

The dollar gained against most of its major counterparts before a German report tomorrow that may show investor confidence in Europe’s largest economy slid to a three-year low, boosting demand for safer assets. The ZEW Center for European Economic Research may say its index of German investor and analyst expectations, which aims to predict developments six months in advance, declined to minus 55.8 in December, according to the median estimate in a Bloomberg News survey of economists.

The euro slid versus the yen as Italy and France prepare to sell bills amid concern the region’s debt crisis is spreading to bigger nations.

EUR/USD: on Asian session the pair fell.

GBP/USD: on Asian session the pair dropped.

USD/JPY: on Asian session  the pair holds in range Y77.60-Y77.70.

In first half of Monday the euro advanced as Italy’s cabinet approved a plan to cut its deficit before a European summit on the region’s sovereign debt crisis. Italian Prime Minister Mario Monti announced 30 billion euros of austerity and growth measures yesterday. The premier will present the package, which includes a tax on luxury goods, resurrects a property levy on first homes, and forces many workers to delay retirement. The proposal will go before both houses of parliament. The euro appreciated after people familiar with the negotiations said a proposal to channel European Central Bank loans through the International Monetary Fund may deliver as much as 200 billion euros ($269 billion) to fight the crisis. But later the euro fall as the European ratings story from the FT is circulated and receives attention, FT report asserting that S&P has warned Germany, France, Netherlands, Austria, Finland and Luxembourg that their ratings are at risk because of the EU crisis. Earlier the euro advanced after France and Germany said they want a rewrite of the European Union’s governing treaties to tighten economic cooperation in the region. The 17-nation currency was supported as Italy’s cabinet approved a deficit-cut plan, easing concern the region’s debt crisis in worsening.

On Tuesday the euro fell against yen after Standard & Poor’s warned it may downgrade the European Financial Stability Fund, reinforcing concern that policy makers haven’t contained the region’s debt crisis. The 17-nation euro fluctuated against the dollar as U.S. stocks rose. The euro area’s six AAA rated countries are among those placed on a negative outlook, and their ratings may be cut depending on the result of a summit of European leaders on Dec. 9, S&P said yesterday in a statement. The company said ratings may be cut by one level for Austria, Belgium, Finland, Germany, the Netherlands and Luxembourg, and by up to two levels for the other governments.

On Wednesday the euro declined after a German government official said the nation rejects proposals to combine current and permanent euro-area rescue funds. Germany rejects proposals to combine the current and permanent euro-area rescue funds, the government official told reporters in Berlin today on condition of anonymity because the negotiations are private. The official’s comments came after the Financial Times reported yesterday that EU leaders may agree on a package including the existing 440 billion euro bailout fund and a new 500 billion euro facility. Economists predict the European Central Bank will cut its benchmark interest rate at a policy meeting.

But later the euro rose against the dollar, erasing earlier losses, as some stocks advanced and optimism increased that European leaders will be able to agree on measures to help solve the region’s debt crisis.

On Thursday the euro fell after European Central Bank President Mario Draghi said he didn’t signal stepping up bond purchases to spur growth. The euro reached the lowest level this month versus the greenback, reversing brief gains, after Draghi’s comments damped speculation that the ECB would expand its bond- buying role to stem the region’s debt crisis. Draghi said during a press conference in Frankfurt that he was “kind of surprised by the implicit meaning” that was given to his comments last week when he said the ECB could follow faster fiscal union with “other elements.”

On Friday the euro rose against the dollar and yen after government leaders holding all-night talks in Brussels added 200 billion euros ($267 billion) to their crisis-fighting capacity and toughened anti-deficit rules. The 17- nation currency fell earlier as U.K. Prime Minister David Cameron said there was “fundamental disagreement” in European Union talks in Brussels and as Finland threatened to withdraw from the permanent bailout fund if changes to decision making are introduced. Finland is ready to withdraw its support from Europe’s permanent rescue mechanism if the Nordic country’s condition of unanimous decision making is ignored, Finance Minister Jutta Urpilainen said. Europe’s leaders last night agreed on the need for a “qualified majority” to speed up decision-making and prevent individual countries from blocking bailouts.

Asian stocks fell for a second day amid economic reports indicating Europe’s debt crisis is contributing to slower growth in Japan, South Korea and China.

Stocks fell after the European Central Bank damped speculation it would step up debt purchases.

European Central Bank President Mario Draghi, speaking after the bank announced an interest rate cut, said he was “surprised” that markets interpreted earlier comments as hinting at big bond buys. He said a euro-zone “fiscal compact” is the “most important precondition” for normalizing markets and “the responsibility is with the leaders.”

Later in Brussels, Europe leaders laid out a new fiscal plan to prevent future debt runups, accelerated the startup of a planned 500 billion-euro rescue fund and scaled back bondholder loss-sharing provisions.

On Friday Kawasaki Kisen dropped the most in the Nikkei 225, falling 5.4% after Mitsubishi UFJ Morgan Stanley cut the shipping line’s stock price estimate to 180 yen from 200 yen, citing falling cargo rates on European routes.

Developers also declined after Miki Shoji Co. said the vacancy rate for Tokyo office space rose to 8.9 percent in November from 8.78 percent the month before.

Mitsui Fudosan sank 3.6%, Mitsubishi Estate Co. declined 3.4%, Sumitomo Realty & Development Co. slid 3.8%.

European stocks advanced after the euro-area leaders agreed on a fiscal union and a report said China’s central bank will set up $300 billion of funds to invest overseas.

Banks climbed after policy makers watered down a demand that bondholders share the cost of bailing out debt-ridden euro nations.

German Chancellor Angela Merkel said the leaders of the 17 euro nations agreed to tighten budget controls and channel 200 billion euros ($267 billion) through the International Monetary Fund to nations requiring assistance.

In an accord hailed by ECB President Mario Draghi, the leaders outlined a fiscal plan to prevent future debt run-ups, accelerated the start of a planned 500 billion-euro rescue fund and diluted bondholder loss-sharing provisions.

A Reuters report said China will create a new investment vehicle to improve returns on its foreign-exchange reserves. The vehicle will operate one fund targeting investment in the U.S. and another focused on Europe, Reuters reported, citing an unidentified person with knowledge of the matter.

National benchmark indexes climbed in most of western European markets.

Company:

Barclays rallied 5.4%, Intesa Sanpaolo SpA rose 7.9%, Deutsche Bank increased 4.7%.

Daimler jumped 4.1%. The maker of luxury vehicles said its Mercedes-Benz car factories are operating at “near full capacity.”

Alcatel jumped 7.1% after Sanford C. Bernstein & Co. raised its recommendation for France’s largest telecommunications equipment supplier to “outperform” from “market perform” and called for a breakup of the company to give a “significant upside” to shareholders.

Resistance 3: Y79.00 (Nov 1 high)

Resistance 2: Y78.30 (Nov 29 high)

Resistance 1: Y77.90 (resistance line from Nov 31)

The current price: Y77.64

Support 1:Y77.50 (Dec 9 low)

Support 2:Y77.10 (Dec 8 low)

Support 3:Y76.60 (Nov 18 low)

Comments: the pair is on downtrend. In focus support Y77.50.

Resistance 3: Chf0.9330 (Nov 25 high)

Resistance 2: Chf0.9305 (Nov 28 high)

Resistance 1: Chf0.9285/90 (area of Dec 6-9 high)

The current price: Chf0.9275

Support 1: Chf0.9250 (session low)

Support 2: Chf0.9220 (MA (233) H1)

Support 3: Chf0.9180 (Dec 9 low)

Comments: the pair holds in range. In focus resistance Chf0.9285.

Resistance 3 : $1.5730 (Dec 9 high)

Resistance 2 : $1.5590 (Nov 22 high)

Resistance 1 : $1.5660 (session high)

The current price: $1.5630

Support 1 : $1.5600 (support line from Dec 6)

Support 2 : $1.5560 (Dec 6 low)

Support 3 : $1.5525 (Nov 30 low)

Comments: the pair holds in range. In focus support $1.5600.

Resistance 3: $1.3455 (Dec 8 high)

Resistance 2: $1.3430 (Dec 9 high)

Resistance 1: $1.3380/90 (session high, MA(233) H1)

The current price: $1.3340

Support 1 : $1.3315 (low of the American session on Dec 9)

Support 2 : $1.3283/85 (area of Dec 8-9 low)

Support 3 : $1.3255 (Nov 30 low)

Comments: the pair is on downtrend. In focus support $1.3315.

00:30 Australia Home Loans October +2.2% +0.2%

00:30 Australia Trade Balance October 2.56 2.12

05:00 Japan Consumer Confidence November 38.6 38.5

06:00 Japan Prelim Machine Tool Orders, y/y November +26.0%

08:15 Switzerland Full time employment level Quarter III 2.77 2.79

18:10 Canada BOC Gov Carney Speaks 0

19:00 U.S. Federal budget November -98.5 -138.0

23:50 Japan Tertiary Industry Index October -0.7% 0.5%