CFD Markets News and Forecasts — 05-09-2014

Most stock indices closed lower as investors doubt the effectiveness of a European Central Bank's stimulus measures. The European Central Bank (ECB) lowered its interest rate to 0.05% from 0.15% yesterday. The central bank also cut its deposit facility rate to -0.20% from -0.10% and its marginal lending rate to 0.30% from 0.40%.

The ECB President Mario Draghi said the central bank will start buying asset-backed securities, including covered bonds. Details of the asset-backed securities (ABS) program will be announced later.

The U.S. labour market data was mixed. The U.S. unemployment rate declined to 6.1% in August from 6.2% in July, but U.S. economy added only 142,000 jobs in August. That could mean that the Fed may wait before hiking its interest rate.

Investors monitor any developments in Ukraine. Representatives of Ukraine and pro-Russian separatists agreed on a ceasefire.

German industrial production climbed 1.9% in July, exceeding expectations for a 0.5% gain, after a 0.4% rise in June. June's figure was revised up from a 0.3% increase.

Indexes on the close:

Name Price Change Change %

FTSE 100 6,855.1 -22.87 -0.33%

DAX 9,747.02 +22.76 +0.23%

CAC 40 4,486.49 -8.45 -0.19%

The U.S. dollar traded mixed to lower against the most major currencies after the mixed U.S. labour market data. The U.S. economy added 142,000 jobs in August, missing expectations for a rise of 222,000 jobs, after a gain of 212,000 jobs in July. July's figure was revised up from a gain of 209,000 jobs.

That was the slowest pace in 2014.

The U.S. unemployment rate declined to 6.1% in August from 6.2% in July, in line with expectations.

The euro traded mixed against the U.S. dollar. The European Central Bank's (ECB) interest rate cut to 0.05% from 0.15% still weighed on the Euro.

Eurozone's gross domestic product (GDP) was flat in the second quarter, in line with expectations.

On a yearly basis, Eurozone's GDP rose 0.7% in the second quarter, in line with expectations.

German industrial production climbed 1.9% in July, exceeding expectations for a 0.5% gain, after a 0.4% rise in June. June's figure was revised up from a 0.3% increase.

The British pound traded mixed against the U.S. dollar. The Bank of England's interest rate decision weighed on the pound. The Bank of England (BoE) kept its interest rates unchanged at 0.5% and its asset purchase program unchanged at £375 billion.

Consumer inflation expectations for the coming year in the UK climbed to 2.8% from 2.6% in May.

The Canadian dollar traded mixed against the U.S. dollar after the weaker-than-expected Canadian labour market data. Canada's unemployment rate remained unchanged at 7.0% in August, in line with expectations.

Canadian economy lost 11,000 net jobs in August, missing forecasts of an increase of 10,300 jobs, after a rise of 41,700 jobs in July.

Canada's Ivey purchasing managers' index dropped to 50.9 in August from 54.1 in July, missing expectations for an increase to 55.7.

The Swiss franc traded mixed against the U.S. dollar. Foreign currency reserves of the Swiss National Bank increased to 453.799 billion Swiss francs in August from 453.353 billion Swiss francs in July. July's figure was revised down from 453.391 billion Swiss francs.

The New Zealand dollar traded higher against the U.S dollar in the absence of any major economic reports from New Zealand.

New Zealand's Finance Minister Bill English said in an interview today that he expects the kiwi to decline further as the U.S. economy recovers.

The Australian dollar traded higher against the U.S. dollar after the mixed U.S. labour market data.

The AiG Performance of Construction Index rose to 55 in August from 52.6 in July.

The Japanese yen traded higher against the U.S. dollar. Japan's leading economic index increased to 106.5 in July from 105.5 in June, missing expectations for a rise to 107.2.

Japan's coincident index slightly rose to 109.9 in July from 109.7 in June.

West Texas Intermediate and Brent crudes dropped after weaker-than-estimated U.S. jobs growth in August and as Ukraine and pro-Russian separatists agreed to a cease-fire.

Both benchmark oils are poised for weekly declines. U.S. employers added the fewest number of jobs this year in August, Labor Department data showed today. The two sides agreed to stop fighting at 6 p.m. local time today, Heidi Tagliavini, a representative of the Organization for Security and Cooperation in Europe, said after talks in Minsk, Belarus. Russia is the world's largest energy exporter.

"The jobless report was disappointing," Kyle Cooper, director of research with IAF Advisors and Cypress Energy Capital Management in Houston, said by phone. "It's evidence that the economy isn't going gangbusters. This raises demand concerns, especially when economies elsewhere are looking weak."

WTI for October delivery slipped 85 cents, or 0.9 percent, to $93.60 a barrel at 10:58 a.m. on the New York Mercantile Exchange. Prices are down 2.5 percent this week and 4.9 percent this year.

Brent for October settlement dropped 87 cents, or 0.9 percent, to $100.96 a barrel on the London-based ICE Futures Europe exchange. The contract is down 2.2 percent this week. The European benchmark crude traded at a $7.36 premium to WTI, compared with $7.38 at yesterday's close.

Gold prices rise to three-month low as slowing down the rally in equity markets caused by the decisions of the ECB and after the release of the employment report in the United States.

Increase in the number of jobs in the United States slowed in August to its lowest level this year, breaking with a series of steady increases, which occurred six months in a row despite the uneven economic growth.

The Labor Department reported that employment in non-farm payrolls rose by a seasonally adjusted 142 thousand. Last month. The unemployment rate, however, fell in August to 6.1% from 6.2% the previous month. Compared to the same period last year, the unemployment rate decreased by 1.1%. Economists had expected growth of the number of employees at the level of 222 thousand., And reduce unemployment to 6.1%.

The European Central Bank on Thursday cut interest rates to new lows, and European Central Bank President Mario Draghi said that the central bank in October will start buying securitized loans (ABS) and asset-backed bonds to revive lending in the euro area.

Although the easing of monetary policy generally favorable for gold, the positive effect of making the ECB offset by a stronger dollar, noted in the report, analysts UBS.

The world's largest reserves of the gold-exchange-traded fund SPDR Gold Trust on Thursday fell by 4.78 tonnes to 785.73 tonnes.

Demand in the physical markets is activated as prices come down. Surcharges in China, the world's largest consumer of gold, rose to $ 05.04 an ounce from $ 3 on Thursday.

The cost of the October gold futures on the COMEX today rose to $ 1273.60 per ounce.

The U.S. Labor Department released the labour market data today. The U.S. economy added 142,000 jobs in August, missing expectations for a rise of 222,000 jobs, after a gain of 212,000 jobs in July. July's figure was revised up from a gain of 209,000 jobs.

That was the slowest pace in 2014.

The U.S. unemployment rate declined to 6.1% in August from 6.2% in July, in line with expectations.

Statistics Canada released the labour market data today. Canada's unemployment rate remained unchanged at 7.0% in August, in line with expectations.

Canadian economy lost 11,000 net jobs in August, missing forecasts of an increase of 10,300 jobs, after a rise of 41,700 jobs in July.

Employment in Canada rose by 81,000 positions compared to a year ago, mostly in part-time job.

Canada's private-sector lost 111,800 jobs in August. That was the largest one-month fall.

EUR/USD $1.3100 (E1bn), $1.3150(E419mn), $1.3185(E257mn), $1.3200(E940mn)

EUR/GBP stg0.7900(E252mn)

USD/JPY Y104.15($565mn), Y104.70($445mn), Y105.50($485mn)

USD/CAD C$1.0825($925mn), C$1.0880($230mn), C$1.0900($731mn), C$1.0940($386mn), C$1.0945($275mn), C$1.0950($245mn)

AUD/USD $0.9350(A$316mn

NZD/USD $0.8350(NZ$150mn)

U.S. stock-index futures fluctuated as weaker-than-estimated jobs growth fueled speculation the Federal Reserve won't have to raise rates sooner than anticipated.

Global markets:

Nikkei 15,668.68 -7.50 -0.05%

Hang Seng 25,240.15 -57.77 -0.23%

Shanghai Composite 2,326.43 +19.57 +0.85%

FTSE 6,839.49 -38.48 -0.56%

CAC 4,479.04 -15.90 -0.35%

DAX 9,728.61 +4.35 +0.04%

Crude oil $94.49 (+0.01%)

Gold $1270.00 (+0.27%)

(company / ticker / price / change, % / volume)

Upgrades:

Downgrades:

Other:

Johnson & Johnson (JNJ) initiated with an Outperform at BMO Capital Mkts, target $118

Economic calendar (GMT0):

(Time/ Region/ Event/ Period/ Previous/ Forecast/ Actual)

00:15 U.S. FOMC Member Richard Fisher Speaks

01:00 U.S. FOMC Member Narayana Kocherlakota

05:00 Japan Leading Economic Index July 105.5 107.2 106.5

05:00 Japan Coincident Index July 109.7 109.9

05:00 Japan BoJ monthly economic report

06:00 Germany Industrial Production s.a. (MoM) July +0.3% +0.5% +1.9%

06:00 Germany Industrial Production (YoY) July -0.5% +2.5%

07:00 Switzerland Foreign Currency Reserves August 453.4 453.8

08:30 United Kingdom Consumer Inflation Expectations Quarter III +2.6% +2.8%

09:00 Eurozone GDP (QoQ) (Finally) Quarter II 0.0% 0.0% 0.0%

09:00 Eurozone GDP (YoY) (Finally) Quarter II +0.7% +0.7% +0.7%

The U.S. dollar traded mixed to lower against the most major currencies ahead of the U.S. labour market data. The U.S. unemployment rate is expected to decline to 6.1% in August from 6.2% in July.

U.S. companies are expected to add 222,000 jobs in August.

The euro traded slightly higher against the U.S. dollar. The European Central Bank's (ECB) interest rate cut to 0.05% from 0.15% still weighed on the Euro.

Eurozone's gross domestic product (GDP) was flat in the second quarter, in line with expectations.

On a yearly basis, Eurozone's GDP rose 0.7% in the second quarter, in line with expectations.

German industrial production climbed 1.9% in July, exceeding expectations for a 0.5% gain, after a 0.4% rise in June. June's figure was revised up from a 0.3% increase.

The British pound traded lower against the U.S. dollar. The Bank of England's interest rate decision weighed on the pound. The Bank of England (BoE) kept its interest rates unchanged at 0.5% and its asset purchase program unchanged at £375 billion.

Consumer inflation expectations for the coming year in the UK climbed to 2.8% from 2.6% in May.

The Canadian dollar traded mixed against the U.S. dollar ahead of Canadian labour market data. Canadian unemployment rate is expected to remain unchanged at 7.0% in August.

Canada's economy is expected to add 10,300 jobs in August.

The Swiss franc traded slightly higher against the U.S. dollar. Foreign currency reserves of the Swiss National Bank increased to 453.799 billion Swiss francs in August from 453.353 billion Swiss francs in July. July's figure was revised down from 453.391 billion Swiss francs.

EUR/USD: the currency pair rose to $1.2964

GBP/USD: the currency pair fell to $1.6286

USD/JPY: the currency pair decreased to Y105.10

The most important news that are expected (GMT0):

12:30 Canada Employment August 41.7 10.3

12:30 Canada Unemployment rate August 7.0% 7.0%

12:30 U.S. Average hourly earnings August 0.0% +0.2%

12:30 U.S. Unemployment Rate August 6.2% 6.1%

12:30 U.S. Nonfarm Payrolls August 209 222

14:00 Canada Ivey Purchasing Managers Index August 54.1 55.7

EUR/USD

Offers $1.3220, $1.3200, $1.3160, $1.3090, $1.3000

Bids $1.2900, $1.2810, $1.2750/45

GBP/USD

Offers $1.6535, $1.6500, $1.6465, $1.6400, $1.6380

Bids $1.6280, $1.6250, 1.6220, 1.6200

AUD/USD

Offers $0.9415/20, $0.9400, $0.9390

Bids $0.9330, $0.9300, $0.9260, $0.9250, $0.9235

EUR/JPY

Offers Y138.30, Y138.00, Y137.10

Bids Y135.95, Y135.70, Y135.00

USD/JPY

Offers Y106.00, Y105.70

Bids Y104.70, Y104.30, Y104.00, Y103.80, Y103.50, Y103.20

EUR/GBP

Offers stg0.8035, stg0.8015, stg0.7995

Bids stg0.7890, stg0.7850, stg0.7820, stg0.7800

Stock indices traded lower as investors are awaiting the U.S. labour market data. Strong data from the U.S. could mean that the Fed may hike its interest rate sooner than expected.

Yesterday's European Central Bank's interest rate cut also weighed on markets. The European Central Bank (ECB) lowered its interest rate to 0.05% from 0.15%. The central bank also cut its deposit facility rate to -0.20% from -0.10% and its marginal lending rate to 0.30% from 0.40%.

The ECB President Mario Draghi said the central bank will start buying asset-backed securities, including covered bonds. Details of the asset-backed securities (ABS) program will be announced later.

Investors monitor any developments on a possible ceasefire agreement for eastern Ukraine.

German industrial production climbed 1.9% in July, exceeding expectations for a 0.5% gain, after a 0.4% rise in June. June's figure was revised up from a 0.3% increase.

Current figures:

Name Price Change Change %

FTSE 100 6,833.42 -44.55 -0.65%

DAX 9,705.66 -18.60 -0.19%

CAC 40 4,478.31 -16.63 -0.37%

Most Asian stock indices closed lower closed lower as the European Central Bank's interest rate decision weighed on markets. The European Central Bank (ECB) lowered its interest rate to 0.05% from 0.15%. The central bank also cut its deposit facility rate to -0.20% from -0.10% and its marginal lending rate to 0.30% from 0.40%.

The ECB President Mario Draghi said the central bank will start buying asset-backed securities, including covered bonds. Details of the asset-backed securities (ABS) program will be announced later.

Yesterday's Bank of Japan's (BoJ) interest rate decision also weighed on markets. The BoJ kept its monetary policy unchanged. The BoJ said it will expand the monetary base at an annual pace of about ¥60 to ¥70 trillion. Japan's central bank added that it will continue with its quantitative and qualitative easing to achieve the 2% inflation target.

Indexes on the close:

Nikkei 225 15,668.68 -7.50 -0.05%

Hang Seng 25,240.15 -57.77 -0.23%

Shanghai Composite 2,326.43 +19.57 +0.85%

EUR/USD $1.3100 (E1bn), $1.3150(E419mn), $1.3185(E257mn), $1.3200(E940mn)

EUR/GBP stg0.7900(E252mn)

USD/JPY Y104.15($565mn), Y104.70($445mn), Y105.50($485mn)

USD/CAD C$1.0825($925mn), C$1.0880($230mn), C$1.0900($731mn), C$1.0940($386mn), C$1.0945($275mn), C$1.0950($245mn)

AUD/USD $0.9350(A$316mn

NZD/USD $0.8350(NZ$150mn)

Economic calendar (GMT0):

(Time/ Region/ Event/ Period/ Previous/ Forecast/ Actual)

00:15 U.S. FOMC Member Richard Fisher Speaks

01:00 U.S. FOMC Member Narayana Kocherlakota

05:00 Japan Leading Economic Index July 105.5 107.2 106.5

05:00 Japan Coincident Index July 109.7 109.9

05:00 Japan BoJ monthly economic report

06:00 Germany Industrial Production s.a. (MoM) July +0.3% +0.5% +1.9%

06:00 Germany Industrial Production (YoY) July -0.5% +2.5%

07:00 Switzerland Foreign Currency Reserves August 453.4 453.8

08:30 United Kingdom Consumer Inflation Expectations Quarter III +2.6% +2.8%

The U.S. dollar traded mixed against the most major currencies. The greenback climbed yesterday as European Central Bank (ECB) lowered its interest rate. The central bank also cut its deposit facility rate to -0.20% from -0.10% and its marginal lending rate to 0.30% from 0.40%.

The ECB President Mario Draghi said the central bank will start buying asset-backed securities, including covered bonds. Details of the asset-backed securities (ABS) program will be announced later.

The Fed Governor Jerome Powell said the U.S. labour market has "improved substantially".

The New Zealand dollar traded mixed against the U.S dollar in the absence of any major economic reports from New Zealand. The kiwi declined against the U.S dollar yesterday as the European Central Bank cut its interest rate.

New Zealand's Finance Minister Bill English said in an interview today that he expects the kiwi to decline further as the U.S. economy recovers.

The Australian dollar traded mixed against the U.S. dollar. The ECB's interest rate cut weighed on the Aussie.

The AiG Performance of Construction Index rose to 55 in August from 52.6 in July.

The Japanese yen traded mixed against the U.S. dollar. Japan's leading economic index increased to 106.5 in July from 105.5 in June, missing expectations for a rise to 107.2.

Japan's coincident index slightly rose to 109.9 in July from 109.7 in June.

EUR/USD: the currency pair traded mixed

GBP/USD: the currency pair traded mixed

USD/JPY: the currency pair traded mixed

The most important news that are expected (GMT0):

12:30 Canada Employment August 41.7 10.3

12:30 Canada Unemployment rate August 7.0% 7.0%

12:30 U.S. Average hourly earnings August 0.0% +0.2%

12:30 U.S. Unemployment Rate August 6.2% 6.1%

12:30 U.S. Nonfarm Payrolls August 209 222

14:00 Canada Ivey Purchasing Managers Index August 54.1 55.7

EUR / USD

Resistance levels (open interest**, contracts)

$1.3055 (2706)

$1.3012 (1461)

$1.2978 (765)

Price at time of writing this review: $ 1.2932

Support levels (open interest**, contracts):

$1.2910 (1512)

$1.2883 (1813)

$1.2845 (993)

Comments:

- Overall open interest on the CALL options with the expiration date September, 5 is 91348 contracts, with the maximum number of contracts with strike price $1,3200 (11439);

- Overall open interest on the PUT options with the expiration date September, 5 is 61145 contracts, with the maximum number of contracts with strike price $1,3100 (5617);

- The ratio of PUT/CALL was 0.67 versus 0.75 from the previous trading day according to data from September, 4

GBP/USD

Resistance levels (open interest**, contracts)

$1.6600 (1094)

$1.6500 (1016)

$1.6401 (245)

Price at time of writing this review: $1.6308

Support levels (open interest**, contracts):

$1.6200 (395)

$1.6100 (183)

$1.6000 (461)

Comments:

- Overall open interest on the CALL options with the expiration date September, 5 is 33512 contracts, with the maximum number of contracts with strike price $1,7000 (2760);

- Overall open interest on the PUT options with the expiration date September, 5 is 31846 contracts, with the maximum number of contracts with strike price $1,6800 (3478);

- The ratio of PUT/CALL was 0.95 versus 1.07 from the previous trading day according to data from September, 4

* - The Chicago Mercantile Exchange bulletin (CME) is used for the calculation.

** - Open interest takes into account the total number of option contracts that are open at the moment.