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US Session - Dollar Slips in Anticipation of ECB Hike
July 02, 2008 7:25 PM CEST
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G10 Advancers and Decliners vs USD |
| | JPY | 0.01 |  | | | NOK | 0.01 | |  | EUR | -0.01 | | | NZD | -0.01 | | | DKK | -0.01 | | | SEK | -0.01 | | | CHF | -0.01 | | | GBP | -0.02 | | | AUD | -0.03 | | | CAD | -0.09 | |
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Global Indexes |
Current Level |
% Change |
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| Nikkei 225 Index | 13,286.37 | - 1.31 | | Hang Seng Index | 21,704.45 | - 1.79 | | FTSE 100 Index | 5,426.30 | - 0.97 | | DAX Index | 6,305.42 | - 0.16 | | DJIA Index | 11,326.89 | - 0.48 | | S&P 500 Index | 1,277.73 | - 0.55 | | NASDAQ 100 Index | 2,278.36 | - 1.15 |
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World Markets |
Current Level |
% Change |
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| Gold | 941.65 | + 0.21 | | Silver | 18.20 | + 0.44 | | VIX | 24.32 | + 2.83 | | Crude wti | 142.43 | + 1.03 | | USD Index | 72.07 | - 0.45 |
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Todays Calender |
Estimates |
Previous |
Country / GMT |
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| No Additional Releases | -- | -- | -- |
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Currency Tech |
AUDUSD
R 3: 0.9827
R 2: 0.9700
R 1: 0.9670
CURRENT: 0.9626
S 1: 0.9511
S 2: 0.9490
S 3: 0.9449
EURJPY
R 3: 170.00
R 2: 169.46
R 1. 168.60
CURRENT: 168.17
S 1: 166.09
S 2: 166.00
S 3: 165.52
USDSGD
R 3: 1.3850
R 2: 1.3827
R 1: 1.3790
CURRENT: 1.3574
S 1: 1.3560
S 2: 1.3506
S 3: 1.3470
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Market Brief |
The Usd fell in the European session based on the continued trend of economic weakness in the US. The EurUsd traded through 1.58 approaching the 1.60 level. The UsdJpy is trading in with a 106 handle, while the GbpUsd remains the low 1.99 price. Equity markets in the US and Europe are trading lower again, while commodities are higher across the board with oil at 142 and gold at 944. Yields are getting squeezed by rising bond prices, as investors look to hold cash in secure investments. In the near-term we will probably seethis trend
ECB Pres. Trichet spoke today, but focused primarily on the distress in global markets, and made no comments regarding monetary policy. The ECB is expected to raise rates 25bps in tomorrow’s meeting.
PPI rose 1.2% vs. 0.9% expected, contributing to market expectations for the ECB to tighten in response to rising inflation. The UK is facing significant stress in the housing sector as home equity withdrawals dropped to its lowest levels in several years. UK construction PMI came in lower at 38.8 compared to the consensus figure of 43.9. With weak economic data in the UK, we should look for opportunities to short the cable against other G-10 currencies with the exception of the dollar which is also in a downtrend.
The ADP Nonfarm Employment change came in at -79k vs. -20k expected, as this may indicator of the official NFP number which comes out tomorrow. Factory orders came in slightly higher at 0.6% vs. the estimate of 0.4%, which is a sign of growth from a manufacturing standpoint. Regardless the market is waiting to see what the ECB says following the anticipated rate cut in the next meeting. Treasury Sec. Paulson spoke today in regarding global markets, making a point to address the necessity for the govt. to let major financial institutions fail in order to sustain a free market environment. The market is continues to look for comments referencing inflation and the dollar in order to substantiate a strategy to trade the dollar in upcoming months.
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Asian Session - Aud Retail Sales Jump
July 02, 2008 9:40 AM CEST
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G10 Advancers and Decliners vs USD |
| | AUD | 0.71 | | | | NZD | 0.28 | | | | CAD | 0.27 | | | | CHF | 0.18 | | | | DKK | 0.15 | | | | EUR | 0.15 | | | SEK | -0.01 | | | NOK | -0.17 | | | GBP | -0.22 | | | JPY | -0.30 | |
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Global Indexes |
Current Level |
% Change |
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| Nikkei 225 Index | 13,286.37 | - 1.13 | | Hang Seng Index | 21.786.26 | - 1.42 | | Shanghai Index | 2,651.73 | + 0.01 | | FTSE futures | 5,499.00 | - 0.03 | | DAX futures | 6,398.50 | + 0.25 | | SMI Futures | 6,892.00 | + 0.52 | | DJIA futures | 11,343.00 | - 0.31 |
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World Markets |
Current Level |
% Change |
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| Gold | 941.54 | + 0.20 | | Silver | 18.14 | + 0.11 | | VIX | 23.65 | - 1.25 | | Crude wti | 142.01 | + 0.73 | | USD Index | 72.22 | - 0.20 |
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Todays Calender |
Estimates |
Previous |
Country / GMT |
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| CIPS/RBS Report on Construction (Jun) | 43.1 | 43.9 | UK / 8.30 | | Producer Price Index (May) | +0.9%(+6.7 | +0.8%(+6.1 | EZ / 9.00 | | ADP Change in Employment | -20k | +40k | US / 12.15 |
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Currency Tech |
AUDUSD
R 3: 0.9827
R 2: 0.9700
R 1: 0.9670
CURRENT: 0.9610
S 1: 0.9511
S 2: 0.9490
S 3: 0.9449
EURJPY
R 3: 170.00
R 2: 169.46
R 1. 168.60
CURRENT: 167.81
S 1: 166.09
S 2: 166.00
S 3: 165.52
USDSGD
R 3: 1.3850
R 2: 1.3827
R 1: 1.3729
CURRENT: 1.3618
S 1: 1.3560
S 2: 1.3506
S 3: 1.3470
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Market Brief |
Usd was stable in the Asian session as better then expected US data kept the greenback bears in check. EurUsd found support from the 5-ma trading from 1.5777 to 1.5820 while GbpUsd was unable to hold above the psychological 2.000 mark, trading between 1.9930 – 1.995. UsdJpy saw a decent rally off 105.25 to 106.18 before slipping slightly to 105.80 as the trading day wore on. Aud crosses were gainers after better then expected retail sales caused AudUsd to jump from 0.9521 to 0.9609 and AudJpy climb to 101.79.
Yesterday's rise in the ISM survey of manufacturing was a positive sign, however the detail's are less than hopeful. The composite index rose to 50.2 vs.. 48.5 exp (which suggest an annual GDP around 2.0%). The concern is that the largest contribution to this number was investors who increased accumulation due to soft demand. It’s interesting to note that the industrial sector has not yet been pulled down by the deteriorating housing sector and weak consumer confidence.
In Australia, retail sales rose 0.7% vs. 0.1%, the strongest biggest monthly rise since July 2007. At this point we expect this figure to be a one off as stock liquidation sales and significant discounting occurred as retailer attempted to improve the slow start to the year. In addition, building approvals fell by -6.5% vs. -3.0%. While positive data will undoubtedly give the Aud temporary support, as the markets speculate on the RBAs monetary policy, we expect the domestic market to continue to deteriorate.
In Turkey, police arrested a number of prominent secularists who were charged with planning a coup. We expect this is only the beginning of an escalation in a political power struggle as the Supreme Court hears arguments on whether to ban the AKP. Usdtry traded up to 1.2512 on the news.
In the European Session Euro zone Producer price inflation is expected to rise as surging energy prices have put pressure on inputs. A strong figure should give the EurUsd a supportive tone today. Note that Usd index is already testing the bull channel base and a break could lead to further weakness.
10.10gmt - ECB’s Tumpell-Gugerell Speaks
16.00gmt - US Trsy Sec pauls speaks
17.00gmt - Fed's Mishkin speaks
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