Trading News and Views:  10  March 2010

Indices:

European markets:

For a second consecutive day, markets like FTSE was down in Europe as banking stocks and mining stocks ended on a low note.  Mike Lenhoff, strategist at Brewin Dolphin said: "Markets are having a bit of a breather and hopefully it is no more than a bit of light profit taking. Earnings are coming through quite nicely and I think there is still a fair degree of confidence which is helpful for companies. I would put this down to nothing more than a slight technical adjustment."
(source: reuters.com).

Henk Potts, market analyst at Barclays Wealth said: "The FTSE is pausing for breath after a strong run, but the fundamentals still remain very solid.  Those fundamentals are a strong rebound in corporate profitability, an increase in terms of shareholder benefits along with supportive M&A activity."
(source: reuters.com).

US markets:

Tuesday saw a very bright day for US stocks especially Dow Jones.  Shares of telecommunications and Internet devices companies rose and adding to this, airline industry also ended on a higher note. Paul Mendelsohn, chief investment strategist at Windham Financial Services in Charlotte, Vermont said: "There's a huge rotation taking place today into financials, telecoms and some of the underperforming areas of the market.The market is in an up trend here, pushing toward her highs."
(source:reuters.com).

Dow Jones  gained 11.86 points to 10,564.38.  The S&P 500 index edged up 1.95 points to 1,140.45. The Nasdaq Composite Index rose 8.47 points to 2,340.68.
(source:reuters.com).

Asian markets:  

Asian stocks were down yesterday as shares of Fujitsu was seen under pressure and extended losses on a dispute with its former president. Yutaka Miura, a senior technical analyst at Mizuho Securities said:  "Given a lack of reasons to really push the Nikkei higher and the fact that it rose over 200 points yesterday, this is a good level for a bit of profit-taking. We may be close to a short-term peak right now."
(source:reuters.com).

Kiyoshi Ishigane,  a strategist in Tokyo at Mitsubishi UFJ Asset Management Co said:  “There are seeds of risk everywhere around us, and investors are reducing their stockholdings to see whether the Nikkei breaks through the high end of the recent range.  At the same time, we’re seeing some positive news among the risk seeds.”
(source:bloomberg.com).

Forex / Currencies:

The Japanese Yen rose as most of the world equity markets fell. There was a rise in the risk aversion as investors moved to the Japanese yen.  Camilla Sutton, currency strategist at Scotia Capital said:  "The combination of today's risk-averse trading and repatriation of yen have been the key drivers over the last 12 hours."  
(source: bloomberg.com).

The GBP was under pressure against the dollar when UK ratings agency Fitch said Britain's sovereign credit profile had deteriorated.
(source: bloomberg.com).

The dollar traded down 0.6 percent at 89.70 yen. The euro was down around 0.6 percent against the dollar at $1.3545.
(source: bloomberg.com).

Commodities:

Oil Trading:

Oil prices fell as dollar was strong and there was uncertainity about an economic recovery. Tim Evans, an energy analyst for Citi Futures Perspective said:  "The petroleum markets have tipped back to the downside, with crude oil testing the $80 level from above, on selling prompted by an upturn in the US dollar."
(source: bloomberg.com).

US crude for April fell 38 cents to settle at $81.49.
(source: reuters.com).

Gold Trading:

Gold saw a bad day for a second consecutive day as sovereign debt worries spoiled investment interest in the metal. Saxo Bank senior manager Ole Hansen said: "With the euro below $1.37, gold will be struggling, because it is not going to get the support from the currencies.  The upside on the euro seems to be capped by now, and if that is the case, gold will be as well."
(source: reuters.com).

US gold futures for April delivery on the COMEX division of the NYMEX settled down $1.70 at $1,122 an ounce.
(source: reuters.com).

Bonds:

(Yields move inversely to bond prices)

US Bonds:

Treasuries ended on a high note as US Stocks boosted demand for the government debt before a record-tying auctionof three-year notes of woth $40 billion.  David Ader, head of government bond strategy at Stamford, Connecticut-based CRT Capital Group LLC said:  “To know that asset sales are not yet in the cards has brought some relief to the Treasury market. “The auction will be the theme of the day. The three-year note usually generates a lot of foreign interest and should come down well.”
(source: bloomberg.com).

Ten-year yields decreased 3 basis points to 3.69 percent.
(source: bloomberg.com).

European Bonds:

Disappointing corporate earnings took stocks lower and this took the german bunds to a new height. And adding to this, Fitch Ratings said it may cut Portugal’s credit rating, stoking demand for the safest assets.  Wilson Chin, a fixed-income strategist at ING Groep NV in Amsterdam said:  “Stock markets are a bit down and Fitch came with some news about the periphery. That caused a 'flight to quality.'"
(source: bloomberg.com).

The yield on the 10-year bond fell three basis points to 3.13 percent.
(source: bloomberg.com).