Daily Forex Snapshots

Asian Session - Lehmans Brothers files for Bankruptcy

September 15, 2008 11:04 AM CEST

G10 Advancers and Decliners vs USD

	JPY	2.15
	CHF	1.73
	EUR	0.84
	DKK	0.81
	GBP	0.72
	SEK	0.43
	NZD	0.32
	AUD	0.13
	NOK	-0.05
	CAD	-0.16

Global Indexes

Current Level

% Change

FTSE 100 Index	5,275.30	- 2.61
CAC 40 Index	4,192.36	- 3.23
DAX Index	6,068.27	- 2.67
SMI Index	7,054.99	- 2.22
DJIA futures	11,183.00	- 2.40
S&P future	1,257.20	- 2.67
Nasdaq futures	1,773.25	- 0.13

World Markets

Current Level

% Change

Gold	783.51	+ 2.35
Silver	11.02	+ 1.24
VIX	25.66	+ 5.20
Crude wti	98.92	- 2.23
USD Index	78.34	- 0.76

Todays Calender

Estimates

Country / GMT

Empire State Manufacturing Index (Sep)	+1.0	+2.8	US / 12.30
Industrial Production (Aug)	-0.3%	+0.2%	US / 13.15
Capacity Utilisation (Aug)	79.6%	79.9%	US / 13.15

Currency Tech

USDCAD
R 3: 1.0867
R 2: 1.0821
R 1: 1.0763
CURRENT: 1.0621
S 1: 1.0576
S 2: 1.0544
S 3: 1.0472

AUDUSD
R 3: 0.8353
R 2: 0.8300
R 1: 0.8254
CURRENT: 0.8187
S 1: 0.7901
S 2: 0.7893
S 3: 0.7675

Market Brief

The Usd is weaker across the board in Asian session as events in the financial sector have spilled over into FX. Eurusd traded up from1.4200 to 1.4480 while carry trades such as the GbpJpy dropped significantly. The story that surprised the world late last week has left the financial world stunned as the continuing crisis in Wall street takes the world by storm. This weekend has spawned the darkest news in several generations, and one of the biggest financial demises in Wall street history. Lehmans Brothers has filed for chapter 11 bankruptcy amid failing operations.

Merrill Lynch got a 70% premium on their Friday close price from Bank of America, as they too feel the full brunt of the continuing mortgage crisis. AIG seeks $50Bn in capital to avoid getting downgraded by market specialists.

The EURUSD traded as high as 1.4480 in early trading session, a stark contrast to Friday’s lows of 1.4050. The dollar is feeling the full brunt of the steady unravelling of the critical news on Lehmans and Merrill during the morning. The EURUSD move retraced after European open as the night’s debacle reaches the European markets, which open lower.

The USDJPY opened much lower this morning, trading 2 figures lower from Friday’s 107.90 levels at closing. Yen’s carry trade attractiveness continues to breed risk aversion.

The Chinese, Hongkong, Korean and Japanese markets are closed today, hence the low volumes being traded in the currency markets. The main focus for this week is to see how this news on the Lehmans and Merrill Lynch debacle will affect global markets and it’s trickle down effects. Furthermore, the Fed’s particular handling of the situation, accepting a broader variety of assets as collateral. Finally the FOMC meeting this week will be very closely watched as some say recent developments would warrant a rate cut. One question remains, what will the dollar do, amidst rising gold and a weak – sub $100/barrel crude price.

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