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Trading News and Views: 01 September 2010Indices:European markets:Equities in Europe like the FTSE , CAC and DAX saw a bright day as US consumer confidence data rose, though gains were limited by fears for economic recovery, with the market recording its worst monthly decline since May. (source: reuters.com). Mike Lenhoff, chief strategist at Brewin Dolphin said: "Markets responded to the better-than-expected US consumer confidence, but the markets have not made their mind up about the recovery. There are still worries about a double-dip recession." FTSE, DAX & CAC ended the day between 0.1 and 0.5 percent higher. US markets:Tuesday US stocks like Dow Jones, NASDAQ & S&P 500 were little changed as technology shares had few declines to share with. US consumer confidence rose more than expected in August and home prices ticked up in June, though a separate report showed business activity in the US Midwest grew in August a bit less than economists expected. (source: reuters.com). Eric Kuby, chief investment officer at North Star Investment Management Corp in Chicago said: "It seems like the market is whipping around on every bit of data that comes out. Each piece of news causes a reaction, then 15 minutes later, people are looking for the next piece of news." The Dow Jones Industrail average edged up 4.99 points to 10,014.72. The S&P 500 ticked up 0.41 point to 1,049.33. The NASDAQ Composite slipped 5.94 points to close at 2,114.03. Asian markets:The stocks in Asia like the Japanese Nikkei closed the day on a dull note with disheartened investors bailing out of the market after the Bank of Japan's emergency moves the day before failed to curb the yen's strength. Masayuki Otani, chief market analyst at Securities Japan Inc said: "The market appears to be demanding more steps from Japanese authorities after the BOJ measures were not strong enough to stop the yen from advancing." The Japanese Nikkei shed 325.20 points to 8,824.06. The yen rose against the dollar on Tuesday as investors shrugged off Japan's latest easing move. Vassili Serebriakov, currency strategist at Wells Fargo in New York said: "The policy action by the BoJ isn't going to change the market's mood. It would probably take intervention to shake things up a bit. We're not even sure that (intervention) would cause a sustained reversal of yen strength." The dollar was down 0.8 percent at 83.96 yen. The euro rose 0.2 percent to $1.2684. Oil Trading:The oil market started off on a dull note as there were growing fears of a double-dip US recession weighed on global stocks and oil prices on Tuesday, pushing investors into the safe-haven yen, which neared a 15-year peak versus the dollar. Mike Lenhoff, chief strategist at Brewin Dolphin said: "Markets responded to the better-than-expected US consumer confidence, but the markets have not made their mind up about the recovery. There are still worries about a double-dip recession." (source: reuters.com). Gold Trading: The precious metal gold edged up on a good note as investors kept piling into the safe-haven asset due to growing anxiety over the economic recovery. Bill O'Neill, partner at New Jersey-based commodities firm LOGIC Advisors said: "The gold market has seen very strong alternative asset demand throughout the month of August. There is just a great level of uncertainty surrounding the economy going forward, and gold is continuing its role as the currency of choice." Gold prices for December delivery settled up $11.10 an ounce to $1,250.30. Bonds: (Yields move inversely to bond prices) US Bonds:US bond treasury market was seen good note as minutes of the Federal’s Reserve’s August meeting indicated some officials saw “increased downside risks” to the outlook for growth and inflation. (source: reuters.com). Kevin Flanagan, a Purchase, New York-based fixed-income strategist at Morgan Stanley Smith Barney said: “The Fed is back in easing mode. It wasn’t as if the Fed was downplaying the economy. They acknowledged the softening.” European Bonds:German government bonds rose when the Bank of Japan said “uncertainty” about the US economy is growing, fueling concern that Europe’s economic recovery would stall as the global outlook worsens. (source: reuters.com). Two-year german bonds were at 2.14%. (source: reuters.com). Economic Calendar 01 September 2010: 12:30 am Personal Income (MoM)(Jul) : United States The Personal Income released by the Bureau of Economic Analysis, Department of Commerce measures the total income received by individuals, from all sources including wages and salaries, interest, dividends, rent, workers' compensation, proprietors' earnings, and transfer payments. This figure can provide insight on the US employment situation. A high reading is positive for the USD, whereas a low reading is negative. Previous Rate: 0.0% Consensus Rate:0.3% (Medium Volatility) Recent Market Action:
(percent changes based on previous day's underlying market data, for indication only)
Sources include: Bloomberg.com , Reuters.com, Fxstreet.com, Economicnews.ca, g20.org and FT.com (Any opinions expressed in these updates do not reflect the views of the company, and as such should not be taken as trading advice.)
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