CFD Markets News and Forecasts — 31-08-2012

The Dollar Index fell to a more than three-month low after Federal Reserve Chairman Ben S. Bernanke said he wouldn’t rule out further bond purchases to boost growth and reduce unemployment, which he called a “grave concern.”

The currency fell against all but one of its 16 most-traded peers after Bernanke told central bankers and economists at an annual forum in Jackson Hole, Wyoming, that “nontraditional policies” shouldn’t be ruled out if economic conditions warrant. The dollar also weakened as reports showed business activity in the U.S. expanded more slowly this month and demand for U.S. capital goods dropped in July.

The pound is set for a monthly gain versus the greenback as a report showed U.K. house prices rose in August, easing concern that the recession is worsening.

European stocks rose as Federal Reserve Chairman Ben S. Bernanke said he would not rule out further bond purchases to boost growth and reduce unemployment, which he called a “grave concern.”

Bernanke’s speech comes two weeks before he leads a meeting of the Federal Open Market Committee to decide whether an expansion of the Fed’s record stimulus is needed to spur growth. Two rounds of large-scale asset purchases totaling $2.3 trillion have so far failed to reduce the jobless rate below 8 percent more than three years into the recovery.

Euro-area unemployment reached the highest on record in July, the European Union’s statistics office in Luxembourg said today. The jobless rate in the economy of the 17 nations using the euro was 11.3 percent, the same as in June after that month’s figure was revised higher. That’s the highest since the data series started in 1995.

National benchmark indexes advanced in every western- European market today, except for the U.K. and Iceland. The U.K.’s FTSE 100 Index fell 0.1 percent, while France’s CAC 40 Index rose 1 percent. Germany’s DAX Index climbed 1.1 percent.

Hermes increased 2.3 percent to 228.95 euros as it said annual sales growth excluding currency shifts “could be around 12 percent.” The company last month said it targeted annual revenue growth of 10 percent.

A gauge of European lenders was the best performer of the 19 industry groups on the Stoxx 600, with Banca Monte dei Paschi dei Siena SpA surging 6.5 percent to 22.4 euro cents, and Banco Santander SA rising 6 percent to 5.67 euros. Credit Agricole SA increased 7.6 percent to 4.64 euros.

Neste Oil Oyj, Finland’s only oil refiner, rallied 3.9 percent to 9.16 euros after Goldman Sachs Group Inc. raised the stock to buy from sell.

Gold prices rose to the highest level since mid-April level after a speech by Fed Chairman Ben Bernanke, who has twisted the intention to take action to support the U.S. economy if needed.

Spot gold price reached during the bidding up to $ 1677.80 per troy ounce, the highest level since April 12.

September futures price of gold on the COMEX is now 1675.30 an ounce.

Oil pared gains after Federal Reserve Chairman Ben S. Bernanke didn’t announce new stimulus measures at a speech in Jackson Hole, Wyoming.

Oil trimmed an early rally as Bernanke said he wouldn’t rule out further bond purchases to boost growth and reduce unemployment, which he called a “grave concern.” The euro pared an advance to an eight-week high against the dollar.

Bernanke spoke at the Kansas City Fed’s annual economic- policy conference in Jackson Hole.

Fed policy makers had said they are prepared to provide new stimulus “fairly soon” unless there is evidence of “substantial and sustainable” improvement in the recovery, according to the minutes of the Federal Open Market Committee meeting that ended Aug. 1. The group plans to meet again in September.

The central bank bought a total of $2.3 trillion in bonds from December 2008 to June 2011 to stimulate the economy in two rounds of asset purchases known as quantitative easing.

Oil for October delivery increased $1.23, or 1.3 percent, to $95.85 a barrel at 10:20 a.m. on the New York Mercantile Exchange. Prices are down 0.3 percent this week and 8.8 percent this month. Futures touched $96.68 before Bernanke’s speech.

Brent oil for October settlement rose 88 cents, or 0.8 percent, to $113.53 a barrel on the London-based ICE Futures Europe exchange.

The weakness in the labor market is "serious concern" at the Fed

The economic situation is "far from satisfactory"

Downside risks from the incentives "manageable"

I do not exclude non-traditional options for further stimulus

I doubt that the structural changes are responsible for the high unemployment

To reduce unemployment, economic growth requires a better

Little evidence, that may contribute to financial imbalances

Inflation expectations are stable, despite the large Fed balance

Fed buying bonds does not harm the work of the bond market

The first and second quantitative easing prompted an increase of 3%, added 2 million jobs

Fed bond purchases can still help the economy

Fed bond purchases so far helped the economy

Improvement in the labor market "painfully slow"

Inflation is close to 2%, the target Fed

• The weakness in the labor market is "serious concern" at the Fed

• The economic situation is "far from satisfactory"

• Downside risks from the incentives "manageable"

• I do not exclude non-traditional options for further stimulus

• I doubt that the structural changes are responsible for the high unemployment

• To reduce unemployment, economic growth requires a better

• Little evidence, that may contribute to financial imbalances

• Inflation expectations are stable, despite the large Fed balance

• Fed buying bonds does not harm the work of the bond market

• The first and second quantitative easing prompted an increase of 3%, added 2 million jobs

• Fed bond purchases can still help the economy

• Fed bond purchases so far helped the economy

• Improvement in the labor market "painfully slow"

• Inflation is close to 2%, the target Fed

EUR/USD $1.2400, $1.2500, $1.2540, $1.2550, $1.2580, $1.2600

USD/JPY Y78.40, Y78.50, Y79.20, Y79.30

GBP/USD $1.5690, $1.5800, $1.5845

USD/CHF Chf0.9600, Chf0.9500

Futures rose. The focus is on Bernanke's speech at 14:00 GMT.  
The consensus seems to be that Bernanke will not announce another round of quantitative easing, at least based on surveys of economists.  But action the past month suggests that the market has priced in at least some possibility of a direct announcement today.  

Global Stocks:

Nikkei  8,839.91 -143.87 -1.60%
Hang Seng 19,482.57 -70.34 -0.36%
Shanghai Composite 2,047.52 -5.06 -0.25%
Topix 731.64 -12.15 -1.63%
FTSE  5,752.74 +33.29 +0.58%
CAC  3,422.95 +43.84 +1.30%
DAX 6,996.05 +100.56 +1.46%
Crude oil $95.78 +1,23%
Gold $1664.30 +0.43%

• ECB must "fully" to limit bond yields

• There is room for additional fiscal stimulus in the U.S.

• It is premature to judge the success of the financing for lending

• The Fed is interested in receiving information on the funding scheme for lending in the UK

• Limitation of bond yields can restore market confidence

• ECB may act to mitigate the debt problems in Spain and Italy

Data
01:30 Australia Private Sector Credit, m/m July +0.3% +0.4% +0.2%
01:30 Australia Private Sector Credit, y/y July +4.4% +4.4% +4.2%
05:00 Japan Construction Orders, y/y July +4.6% +8.0% +8.0%
05:00 Japan Housing Starts, y/y July -0.2% -10.0% -9.6%
06:00 United Kingdom Nationwide house price index August -0.7% +0.2% +1.3%
06:00 United Kingdom Nationwide house price index, y/y August -2.6% -2.2% -0.7%
06:00 Germany Retail sales, real adjusted July -0.1% +0.2% -0.9%
06:00 Germany Retail sales, real adjusted July +2.9% +0.1% -1.0%
09:00 Eurozone Harmonized CPI, Y/Y (preliminary) August +2.4% +2.5% +2.6%
09:00 Eurozone Unemployment Rate July 11.2% 11.3% 11.3%

The dollar fell to eight-week low against the euro in the run-up speech by Federal Reserve Chairman Ben Bernanke on the central bank symposium in Jackson Hole, where he will present his annual speech on monetary policy.
The U.S. currency weakened against all of its 16 major counterparts after the Atlanta Fed President Dennis Lockhart said the central bank is serious about conducting further stimulate the economy.
The dollar index (DXY), which tracks the greenback against six major currencies, was down by 0.5% to 81.296, and fell by 1.6% for the month.
The U.S. currency also weakened against the fact that market participants expect a report on factory orders, which are expected to rise in July.
Also today it was announced that the unemployment rate in the euro area in June to 11.3% recorded at the same time the highest level since 1995.
The pound strengthened against the dollar, a report showed that house prices in the UK rose in August, reducing fears that the recession worsens.
The Australian dollar traded near a five-week low on fears of slowing in China, which will hinder economic growth in Australia. Demand for Australian and New Zealand dollar will be limited to the output of the index of purchasing managers in China, which will be presented next week and be able to show the current state of the manufacturing industry, which is expected to be in stagnation. Also today, the RBA said that credit to the private sector grew by 0.2%, compared with growth of 0.3% in June and expectations at 0.4%.

EUR/USD: during the European session, the pair rose more than a figure, and is now approaching the level of $ 1.2625, which is a maximum of 3 July.
GBP/USD: pair shows a steady and strong growth and is now trading near the maximum of yesterday
USD/JPY: the pair managed to update a minimum of 24 August, and then retreated slightly and is now trading at Y78.48

At 12:30 GMT, Canada will report for a change of GDP in June, changes in GDP for the quarter on an annualized basis in the second quarter. At 13:45 GMT the U.S. will release Chicago PMI index for August. At 13:55 GMT the U.S. will publish an indicator of consumer confidence from the University of Michigan in August. At 14:00 GMT the U.S. said the change of volume of industrial orders in July. At the same time will be an economic symposium in Jackson Hole, where an address by Federal Reserve Chairman Ben Bernanke. At 15:55 GMT, the Executive Director of the Bank of England (Financial Stability) Andrew Haldane will deliver a speech at 17:10 GMT and will speak member Monetary Policy Committee Adam Posen.

• The ECB will continue to strive to maintain price stability
• ECB will do whatever is necessary to preserve the integrity of the euro
• Europe needs more solidarity and overall control of the budget
• The main risk for the euro is the lack of confidence in the euro itself

EUR/USD

Offers $1.2600, $1.2590

Bids $1.2487, $1.2470, $1.2450, $1.2430

AUD/USD

Offers $1.0450, $1.0420, $1.0400, $1.0390, $1.0380/85, $1.0345/50

Bids $1.0250, $1.0215, $1.1070 Medium demand

GBP/USD

Offers $1.5850, $1.5820/25, $1.5800/10

Bids $1.5765, $1.5750/40, $1.5720, $1.5705/00

EUR/JPY

Offers Y99.80, Y99.45/50, Y99.20, Y99.00

Bids Y97.80/70, Y97.50

USD/JPY

Offers Y79.20, Y79.00, Y78.90, Y78.75/80

Bids Y78.30/25, Y78.20, Y77.90

EUR/GBP

Offers stg0.8000, stg0.7980, stg0.7945/55

Bids stg0.7890, stg0.7875/70, stg0.7860/50

• It is difficult to say how long it would take to countries in crisis, for reform

• Structural changes in the countries in crisis, will take time

• The banks remain high refinancing needs in the future

• ECB may stop immediately all emergency measures

• Optional emergency measures to stop now

European stocks rose, and if this trend will continue until the close of the session Stoxx Europe 600 Index will record its third consecutive monthly rooted. Now the attention of market participants focused on the speech today by Federal Reserve Chairman Ben Bernanke. At the same time, Asian shares fell and U.S. index futures rose.

Shares of Hermes International SCA (RMS) increased by 1% after the maker of bags Birkin & Kelly raised the target for sales this year on the back of that profit in the first half of the year rose more than expected.

Bankia SA shares have risen by 2.2%, due to the fact that Spain said it was considering the recapitalization of the country's largest lender nationalized by their own means.

Stoxx 600 added 0.3 percent to 265.78 at 9:39 am in London.

European stocks continue to move to the 0.8% drop from the previous week amid signs that the global economic growth is slowing, and the Spanish region of Catalonia asked for funding from central government.

Index MSCI Asia Pacific (MXAP) fell 0.6%, while contracts for Standard & Poor500 index added 0.3% today.

To date:

FTSE 100 5,729.16 +9.71 +0.17%

CAC 40 3,399.79 +20.68 +0.61%

DAX 6,931.84 +36.35 +0.53%

EUR/USD $1.2400, $1.2500, $1.2540, $1.2550, $1.2580, $1.2600

USD/JPY Y78.40, Y78.50, Y79.20, Y79.30

GBP/USD $1.5690, $1.5800, $1.5845

USD/CHF Chf0.9600, Chf0.9500

AUD/USD $1.0275, $1.0300, $1.0395, $1.0400

Asian stocks fell, with the regional benchmark index heading for its first monthly decline since May, as investors await a speech by U.S. Federal Reserve Chairman Ben S. Bernanke and as reports showed lower industrial output in South Korea and Japan amid slowing economic growth.

Nikkei 225 8,839.91 -143.87 -1.60%

S&P/ASX 200 4,316.11 +0.44 +0.01%

Shanghai Composite 2,047.52 -5.06 -0.25%

Sharp Corp. sank 13 percent as Taiwan’s Foxconn Technology Group founder Terry Gou ended a visit to Japan without announcing the conclusion of a deal to invest in the Japanese electronics maker.

China Shipping Container Lines Co. slid 7 percent after brokerages including Jefferies Group Inc. downgraded ratings and price targets for the nation’s second- largest shipping company.

01:30 Australia Private Sector Credit, m/m July +0.3% +0.4% +0.2%

01:30 Australia Private Sector Credit, y/y July +4.4% +4.4% +4.2%

05:00 Japan Construction Orders, y/y July +4.6%

05:00 Japan Housing Starts, y/y July -0.2% -10.0%

Yesterday the euro continued its yesterday's decline against the dollar on negative sentiment in the market, as well as a sharp decline in stock markets at the opening of trading. At the same time, the Spanish Prime Minister Mariano Rajoy said that Spain will wait a formal request for financial assistance, and the International Monetary Fund said that the European Central Bank should take steps to mitigate the policy. Investors are also slow to cover short dollar positions that are open in the expectation that Bernanke will announce the beginning of the third phase of quantitative easing in Jackson Hole on Friday, as the outcome of this speech is unclear. The single currency rose slightly amid lower borrowing costs in Italy. Italy sold a ten-year treasury bills in the amount of 4.0 billion euros, 3.0-4.0 billion euro target. The ratio of applications to cover was 1.42 versus 1.29 previously.

On stronger dollar also weighed data on consumer spending, which rose in July for the first time in three months, gaining 0.4%. A separate Labor Department report showed that the number of initial claims for unemployment benefits in the U.S. has changed, from a revised upward index last week.

During the first half of the day's pound rose against most currencies after data showed that the number of approved applications for mortgage loans increased in July, thus indicating a recovery from the recession in June. Data from the Bank of England showed that the number of mortgage approvals rose to the level of 47,312 in July. But even these positive data have not helped the pound to hold their positions, and as a result the currency plummeted, updating the yesterday's low. This trend was caused by the Prime Minister of Spain, Mariano Raho.

His speech also contributed to the decline in value the Australian dollar, which lost its position against most major currencies. But the decline began after a government report that the number of approved applications for housing construction fell in July to -17.3%, reaching the minimum values ​​at the same time in the last ten years in the background of the fact that most of the investment now accounts for the mining industry, which is now at its peak. We also learned that the profitability of Australian 10-year bonds continued to decline, fixing the fall for 10 consecutive days, and is on the verge of the long fall, at least since 1990.

Canadian dollar continues to decline relative to the 16 major currencies after yesterday's data showed that the U.S. economy, which is the largest trading partner, increased by more than the initial estimate. Was supported by the fall in output today's U.S. data, which proved positive.

Asian stocks fell, with the regional benchmark index wiping out its gains for the month, as reports on Japanese retail sales and South Korean business confidence add to signs of an economic slowdown and investors doubt the Federal Reserve will announce further stimulus.

Nikkei 225 8,983.78 -86.03 -0.95%

S&P/ASX 200 4,315.7 -40.74 -0.94%

Shanghai Composite 2,050.31 -2.92 -0.14%

Samsung Electronics Co., the world’s biggest mobile-phone maker by sales, slipped 1.2 percent in Seoul.

Atlas Iron Ltd. sank 5.5 percent, leading Australian iron-ore producers lower after the metal’s price in China declined to the lowest level in almost three years.

China Cosco Holdings Co. slid 4.1 percent in Hong Kong after the nation’s largest listed shipping company posted a wider first-half loss.

Change % Change Last

Oil 94.81 +0.19 +0.20%

Change % Change Last

Nikkei 225 8,983.78 -86.03 -0.95%

S&P/ASX 200 4,315.7 -40.74 -0.94%

Shanghai Composite 2,050.31 -2.92 -0.14%

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

EUR/USD $1,2506 -0,19%

GBP/USD $1,5783 -0,29%

USD/CHF Chf0,9601 +0,19%

USD/JPY Y78,62 -0,09%

EUR/JPY Y98,31 -0,31%

GBP/JPY Y124,07 -0,39%

AUD/USD $1,0293 -0,49%

NZD/USD $0,7988 -0,19%

01:30 Australia Private Sector Credit, m/m July +0.3% +0.4% +0.2%

01:30 Australia Private Sector Credit, y/y July +4.4% +4.4% +4.2%

05:00 Japan Construction Orders, y/y July +4.6%

05:00 Japan Housing Starts, y/y July -0.2% -10.0%

06:00 United Kingdom Nationwide house price index August -0.7% +0.2%

06:00 United Kingdom Nationwide house price index, y/y August -2.6% -2.2%

06:00 Germany Retail sales, real adjusted July -0.1% +0.2%

06:00 Germany Retail sales, real adjusted July +2.9% +0.1%

09:00 Eurozone Harmonized CPI, Y/Y (preliminary) August +2.4% +2.5%

09:00 Eurozone Unemployment Rate July 11.2% 11.3%

12:30 Canada GDP (m/m) June +0.1% +0.1%

13:45 U.S. Chicago Purchasing Managers' Index August 53.7 53.6

13:55 U.S. Reuters/Michigan Consumer Sentiment Index (finally) August 73.6 73.7

14:00 U.S. Factory Orders July -0.5% +1.1%

14:00 U.S. Jackson Hole Symposium -

14:00 U.S. Fed Chairman Bernanke Speaks -

17:10 United Kingdom MPC Member Posen Speaks -