Monday, 18 April 2016

Forex - Aussie holds weaker in Asia as investors expect easier policy


Category: Forex


The Aussie fell sharply after major oil producers failed to reach a deal on an output freeze that has implications for monetary policy as crude oil prices dipped sharply on the news.AUD/USD traded down 0.76% to 0.7666, while USD/JPY changed hands at 108.11, down 0.62%. Weaker oil prices are seen as aiding current easy monetary policies globally.New Zealand said first quarter consumer prices rose 0.2%, more than the 0.1% seen quarter-on-quarter and a 0.4% gain seen year-on-year which came in as expected.NZD/USD traded down 0.16% to 0.6906. The data are in line with the Reserve Bank of New Zealand's projections in its March Monetary Policy Statement, according to ASB chief economist Nick Tuffley."Overall, the data published by Stats NZ suggest that, although core inflation pressure is still low, they are starting to lift which may provide the RBNZ with confidence that inflation expectations will also stabilize and recover," Tuffley said.In China, house prices rose 4.9% for March year-on-year, above the 3.6% gain seen.The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, rose 0.01% to 94.69.In the week ahead the economic calendar is light, with the U.S. set to release housing sector data.


The European Central Bank will hold its monetary policy meeting on Thursday and the euro zone is to release data on private sector activity on Friday.Last week, the dollar slid against the other major currencies on Friday following the release of lackluster U.S. economic reports, but the greenback still ended the week higher.The drop in the dollar came after reports showing that U.S. industrial production fell more than expected in March and consumer sentiment deteriorated slightly this month.The University of Michigan said the preliminary reading of its consumer sentiment index came in at 89.7 in April, down from 91.0 in March and lower than the 92.0 reading forecast by economists.Another report showed that U.S. industrial output fell 0.6% in March, worse than the 0.1% decline economists had expected.The reports underlined the view that the Federal Reserve is likely to stick to a cautious approach on future interest rates increases.

Shares in Asia drop as failure to freeze oil output weighs


Category: Stock Market


Asian sahres fell on Monday as markets took a dim view of failure by major oil producers to freeze output, ensuring a global glut of the commodity for the time being.The yuan rose against the dollar on Monday after the People's Bank of China set a first stronger fixing for three sessions at 6.4787 comparedwith 6.4908.The Shanghai Composite was down 1.31%. Hong Kong's Hang Seng index was down 1.21%. The Nikkei 225 fell 2.92%, while the S&P/ASX 200 fell 0.27%.Earlier, New Zealand said first quarter consumer prices rose 0.2%, more than the 0.1% seen quarter-on-quarter and a 0.4% gain seen year-on-year which came in as expected.The data are in line with the Reserve Bank of New Zealand's projections in its March Monetary Policy Statement, according to ASB chief economist Nick Tuffley."Overall, the data published by Stats NZ suggest that, although core inflation pressure is still low, they are starting to lift which may provide the RBNZ with confidence that inflation expectations will also stabilize and recover," Tuffley said.In China, house prices rose 4.9% for March year-on-year, above the 3.6% gain seen.Last week, U.S. stocks were lower after the close on Friday, as losses in the Oil & Gas, Technology and Financials sectors led shares lower.At the close in NYSE, the Dow Jones Industrial Average declined 0.16%, while the S&P 500 index declined 0.10%, and the NASDAQ Composite index lost 0.16%.

Australia stocks lower at close of trade; S&P/ASX 200 down 0.36%


Category: Stock Market


Australia stocks were lower after the close on Monday, as losses in the Energy, Resources and Metals&Mining sectors led shares lower.At the close in Australia, the S&P/ASX 200 lost 0.36%.The best performers of the session on the S&P/ASX 200 were Liquefied Natural Gas Ltd (AX:LNG), which rose 21.21% or 0.105 points to trade at 0.600 at the close. Meanwhile, Select Harvests Ltd (AX:SHV) added 6.26% or 0.280 points to end at 4.750 and APN News&Media Ltd (AX:APN) was up 5.60% or 0.033 points to 0.613 in late trade.The worst performers of the session were Qantas Airways Ltd (AX:QAN), which fell 11.08% or 0.450 points to trade at 3.610 at the close. Santos Ltd (AX:STO) declined 7.07% or 0.295 points to end at 3.875 and Worleyparsons Ltd (AX:WOR) was down 6.97% or 0.440 points to 5.870.Falling stocks outnumbered advancing ones on the Australia Stock Exchange by 516 to 497 and 337 ended unchanged.The S&P/ASX 200 VIX, which measures the implied volatility of S&P/ASX 200 options, was up 8.79% to 16.972.Gold for June delivery was up 0.23% or 2.90 to $1237.50 a troy ounce. Elsewhere in commodities trading, Crude oil for delivery in June fell 4.32% or 1.80 to hit $39.91 a barrel, while the June Brent oil contract fell 4.01% or 1.73 to trade at $41.37 a barrel.AUD/USD was down 0.75% to 0.7667, while AUD/JPY fell 1.48% to 82.79.The US Dollar Index was up 0.04% at 94.72.

Tuesday, 12 April 2016

Bank of Japan's Harada says board will act if needed


Category: Economic Indicators


Bank of Japan board member Yutaka Harada on Wednesday said the central bank should "without hesitation" take additional easy policy if risks facing Japan's economy materialized."Japan's economy is facing risks that would worsen its economy," Harada said in a speech to business leaders in Shimonoseki, Japan. "If they materialized, the virtuous cycle from income to spending would have ceased to operate and the labor market would worsen and then the underlying trend of prices would deteriorate."But he did not offer a guide to any possible steps. He was one of the five board members who agreed to introduce a negative interest rate in January.The BoJ holds its next policy meeting April 27-28, at which the board will release their medium-term outlook for economic growth and theinflation rate until fiscal 2018 to March 2019.

Chinese trade balance 29.86B vs. 30.85B forecast


Category: Economic Indicators


China’s trade balance fell more-than-expected last month, official data showed on Wednesday.In a report, National Bureau of Statistics of China said that Chinese Trade Balance fell to 29.86B, from 32.59B in the preceding month.Analysts had expected Chinese Trade Balance to fall to 30.85B l

Gold prices hold weaker, but copper soars after China trade data


Category: Commodities


Gold prices eased in early Asia on Wednesday with trade data out of China showing a mixed picture after exports unexpectedly soared.On the Comex division of the New York Mercantile Exchange, gold for June delivery fell 0.28% to $1,254.50 a troy ounce.Silver futures for May delivery rose 1.06% to $16.145 a troy ounce, while copper futures jumped 3.85% to $2.171 a pound.In China, March trade data showed a trade balance surplus of $29.86 billion, narrower than the $30.85 billion seen. Exports however jumped 11.5%, handily beating the 2.5% year-on-year gain seen, while imports fell 13.8%, more than the 10.2% decline expected.Overnight, gold closed relatively flat on Tuesday, as the dollar bounced from eight-month lows, offsetting gains from earlier in the session when investors piled into the safe-haven asset after the International Monetary Fund lowered its global economic growth forecasts for the remainder of the year.Since opening the year around $1,065 an ounce, gold has surged more than 18% in 2016 and is on pace for one of its strongest first halves in decades.


On Tuesday morning, the International Monetary Fund (IMF) cut its global growth forecast for 2016 in its latest World Economic Outlook (WEO), citing persistently low oil prices, a continued slowdown in the Chinese economy and weakness in advanced and emerging markets. As a result, the IMF now predicts that the global economy will increase by 3.2% in 2016, down slightly from forecasts of 3.4% three months ago. In advanced economies in particular, the IMF expects modest growth of 2% on the year, amid weak demand, unfavorable demographics and low productivity."Lower growth means less room for error," said Maurice Obstfeld, IMF Economic Counsellor and Director of Research Maurice Obstfeld said in a statement. "Persistent slow growth has scarring effects that themselves reduce potential output and with it, demand and investment."As central banks worldwide continue to rely on negative interest rate policies (NIRPs) in an effort to stave off the threat of deflation, Obstfeld emphasized that major economies cannot solely rely on monetary policy alone to achieve their stated growth targets. Instead, Obstfeld noted that the nations must implement a more potent policy mix, combining revamped structural, fiscal and monetary policies."If national policymakers were to clearly recognize the risks they jointly face and act together to prepare for them, the positive effects on global confidence could be substantial," Obstfeld said.Gold is viewed as a safe-haven for investors in periods of heightened global economic instability.Elsewhere, USD/JPY surged by more than 0.60% to an intraday high of 108.68, likely halting an eight-day losing streak. The dollar remains near a 17-month low against the yen, stemming from fears that widespread easing measures by the Bank of Japan will not be sufficient enough to prevent deflation throughout the Japanese economy. The yen is also viewed as a safe-haven for investors in unsettling economic periods.Meanwhile, Federal Reserve Bank of Dallas president Rob Kaplan reiterated that the Fed should remain data-dependent with the timing of its next interest rate hike, while adding that the U.S. central bank should consider raising rates in June if the economy continues to improve. Last month, the Federal Open Market Committee (FOMC) held its benchmark Federal Funds Rate unchanged at a level between 0.25 and 0.50%."We're trying to get ourselves to a normal level of rates because there's a cost to excessive accommodation," Kaplan told CNBC. "It hurts savers and creates distortions in asset allocation. I think we're going to have to take account of all the data including what currencies are doing and what's going on around the world. We'll try to move patiently but do it in a thoughtful way."Any rate hikes by the Fed this year are viewed as bearish for gold, which struggles to compete with high-yield bearing assets in rising rate environments.

Sunday, 3 April 2016

Forex - Aussie weaker on flat retail sales figures


Category: Forex


The Aussie fell in Asia on Monday as retail sales and other data disappointed, while the euro shrugged off friction between the Greek government and the IMF.AUD/USD traded at 0.7643, down 0.49%, while USD/JPY changed hands at 111.55, down 0.14%. EUR/USD traded at 1.1399, up 0.09%.In Australia the MI inflation gauge for March was flat after a 0.2% month-on-month fall in February.Also in Australia building approvals for February jumped 3.1%, compared with a 2.0% gain seen month-on-month.As well private house approvals dipped 1.2% in February, compared with a revised downward fall of 6.4% in January and retail sales were flat compared to a 0.4% month-on-month gain seen in February.The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down 0.02% at 94.56.In the week ahead, investors will be focusing on Wednesday’s minutes of the Fed’s March meeting for fresh insights on how officials view the economic outlook.The U.S. is also to release economic reports on trade, manufacturing and service sector activity. A central bank meeting in Australia will also be in focus.On Monday, markets in Hong Kong and Shanghai will be closed for holidays.


The euro zone is to report on the unemployment rate and the U.K. is to release survey data on construction sector activity. The U.S. is to publish data on factory orders.Last week, the dollar ended the week close to five-month lows against a basket of the other major currencies on Friday as investors bet that a stronger-than-expected U.S. jobs report would not prompt the Federal Reserve to raise interest rates more quickly.The Labor Department reported that the U.S. economy added 215,000 jobs last month, ahead of economists’ expectations for jobs growth of 205,000.The unemployment rate ticked up to 5% from an eight-year low of 4.9% as more people entered the labor market. Average hourly earnings rose by seven cents last month after falling two cents in February.A separate report showed that U.S. manufacturing activity expanded in March for the first time in six months as new orders rose.The Institute for Supply Management said its manufacturing index rose to 51.8 from 49.5 in February.But the upbeat data did little to alter expectations that the Fed will remain cautious about hiking interest rates this year.Earlier in the week Fed Chair Janet Yellen said global risks to the U.S. economy, including low oil prices and uncertainty over China justified taking a cautious approach to tightening monetary policy. Lower interest rates make the dollar less attractive to yield seeking investors.

Shares in ASia down on regional data, thin trade with Shanghai, HK shut


Category: Stock Market


Shares fell in Asia on Monday with investors noting regional data as well as rumblings between the IMF and Greece and with markets shut in Greater China for a holidayThe Nikkei 225 fell 0.32%, while the S&P/ASX 200 dropped 1.41%. Markets in Hong Kong and Shanghai were closed on Monday.In Australia the MI inflation gauge for March was flat after a 0.2% month-on-month fall in February.Also in Australia building approvals for February jumped 3.1%, compared with a 2.0% gain seen month-on-month.As well private house approvals dipped 1.2% in February, compared with a revised downward fall of 6.4% in January and retail sales were flat compared to a 0.4% month-on-month gain seen in February.Last week, U.S. stocks rose considerably on Friday as an optimistic March jobs report provided signals of an improving domestic economy, while investors shrugged off sharp declines in crude futures demonstrating indications that equities could be on the verge of decoupling from volatile oil prices.On Friday morning, the U.S. Department of Labor said nonfarm payrolls rose by 215,000 in March, slightly above consensus estimates of 210,000, building off gains of 245,000 from the previous month. Notably, average hourly earnings jumped by 0.3% one month after slumping by 0.1% in February. The labor force participation rate also increased by 0.1 to 63%, while the unemployment rate rose mildly to 5.0%, hovering near eight-year lows.The Dow Jones Industrial Average gained 107.66 or 0.61% to 17,792.75, while the S&P 500 Composite index added 13.04 or 0.63% to 2,072.78, kicking off the second quarter on the right foot. The NASDAQ Composite index, meanwhile, rose 44.69 or 0.92% to 4,914.54 after receiving a considerable boost from the slumping biotech sector. On the S&P 500, eight of 10 industries closed in the green, as stocks in the Health Care, Technology and Consumer Goods sectors led. Stocks in the energy industry lagged, plunging more than 1.45% on the session.Volatility remained low, as the S&P 500 VIX index fell roughly 3% to an intraday low of 13.41, its lowest level year to date.

Friday, 1 April 2016

Brazil stocks higher at close of trade; Bovespa up 1.01%


Category: Stock Market


Brazil stocks were higher after the close on Friday, as gains in the Basic Materials, Real Estate and Financials sectors led shares higher.At the close in Sao Paulo, the Bovespa rose 1.01%.The best performers of the session on the Bovespa were Gerdau SA (SA:GGBR4), which rose 7.36% or 0.48 points to trade at 7.00 at the close. Meanwhile, Bradespar SA (SA:BRAP4) added 6.05% or 0.37 points to end at 6.49 and Natura Cosmeticos SA (SA:NATU3) was up 6.03% or 1.60 points to 28.14 in late trade.The worst performers of the session were Cia Energetica de Minas Gerais (SA:CMIG4), which fell 1.98% or 0.16 points to trade at 7.93 at the close. Suzano Papel e Celulose SA (SA:SUZB5) declined 1.90% or 0.24 points to end at 12.42 and JBS SA (SA:JBSS3) was down 1.83% or 0.20 points to 10.75.Rising stocks outnumbered declining ones on the Sao Paulo Stock Exchange by 183 to 131 and 21 ended unchanged.The CBOE Brazil Etf Volatility, which measures the implied volatility of Bovespa options, was down 1.07% to 50.94.Gold for June delivery was down 0.91% or 11.30 to $1224.30 a troy ounce. Elsewhere in commodities trading, Crude oil for delivery in May fell 4.17% or 1.60 to hit $36.74 a barrel, while the May US coffee C contract fell 0.60% or 0.77 to trade at $126.65 .USD/BRL was down 1.01% to 3.5566, while EUR/BRL fell 0.90% to 4.0525.The US Dollar Index was down 0.06% at 94.59.

EUR/USD posts fifth straight win, as traders shrug off upbeat jobs data


Category: Forex


Investing.com -- EUR/USD inched up on Friday posting its fifth consecutive winning session, as currency traders mostly shrugged off a positive U.S. jobs report days after Federal Reserve chair Janet Yellen said the U.S. central bank would take a cautious approach to the timing of its next interest rate hike.The currency pair traded in a broad range between 1.1338 and 1.1437, before settling at 1.1389, up 0.008 or 0.07% on the session. The euro hit fresh 5-month highs on Friday morning, before the dollar trimmed losses after the release of the mostly upbeat data. In the last month alone, the euro has surged nearly 5% against its American counterpart, as longstanding concerns related to a sharp divergence in monetary policies has faded.EUR/USD likely gained support at 1.0538, the low from December 3 and was met with resistance at 1.1496, the high from Oct. 15.On Friday morning, the U.S. Department of Labor's Bureau of Labor Statistics (BLS) said nonfarm payrolls rose by 215,000 in March, slightly above consensus estimates of 210,000 and extending encouraging gains from February when the labor market added an upwardly revised 245,000 nonfarm positions. The gains were concentrated in Retail Trade, Construction and Health Care, which all exhibited considerable increases over the month. After adding 48,000 jobs in March, the Retail Trade sector has grown by more than 375,000 during the last year."The remarkable U.S. recovery continues, as total nonfarm employment increased by 215,000 in March. Beginning just a year after President Obama inherited the worst economic crisis in generations, businesses have been adding jobs at an extended, record-setting clip: a total of 14.4 million jobs over the last 73 consecutive months of private-sector job growth," U.S. labor secretary Thomas Perez said in a statement."There are so many reasons to be bullish about our economic future, but we can’t become complacent about the challenges that remain. Continued weakness in manufacturing, for example, is a reminder that we must keep working to restore balance to the economy, to ensure that the recovery benefits people in all communities, up and down the income spectrum."Although the unemployment rate inched up by 0.1 to 5.0%, it still remains near eight-year lows from the previous two months. 


The U-6 unemployment rate, which factors in workers marginally attached to the labor force, as well as part-time workers, rose slightly to 9.8%. By comparison, the U-6 rate stood at 10.9% last March and reached as high as 18.0% at the height of the Great Recession. The reading is the Fed's preferred gauge for unemployment, as it judges the strength of the labor market.Notably, average hourly earnings jumped by 0.3% one month after slumping by 0.1% in February. The labor force participation rate also increased by 0.1 to 63%, while the average work week held steady at 34.4 hours.The CME Group's (NASDAQ:CME) Fed Watch tool increased the probability of a June interest rate hike to 25.0% on Friday from 19.0% on the previous day. Last month, there was a 77% chance the Fed would raise short-term rates at least once before July, according to the CME Group. Earlier this week, Yellen said the Federal Open Market Committee (FOMC) will likely raise rates gradually in light of heightened global economic and financial risks. The FOMC has left its benchmark Federal Funds Rate at a targeted range between 0.25 and 0.50% in each of its first two meetings this year.The U.S. Dollar Index, which measures the strength of the greenback versus a basket of six other major currencies, gained more than 0.10% to an intraday high of 95.10, before falling back to 94.59 in U.S. afternoon trading. The index remains near five-month lows.One day after falling to five-week lows, yields on the U.S. 10-Year were flat at 1.77%.

Shares in SunEdison plunge 50% after reports of possible bankruptcy


Category: Stock Market


Investing.com -- Shares in SunEdison Inc (NYSE:SUNE) fell as much as 50% in after-hours trading after the Wall Street Journal reported late on Friday that the Missouri-based solar energy company could be on the verge of declaring bankruptcy.Citing sources close to the company, the newspaper reported that SunEdison is in the process of preparing Chapter 11 filings and has held negotiations with two separate creditors in an attempt to receive financing for the bankruptcy. Reports of the renewable energy company's looming demise have been widely anticipated following a series of missteps in recent weeks.Shares in SunEdison had already fallen precipitously this year, amid reports of significant debt restructuring, failing transactions and its missed filing deadline from the fourth quarter of Fiscal Year 2015.Last month, SunEdison disclosed that the company had delayed the filing of its Annual Report on Form 10-K beyond the extended due date of March 15, after its management team identified "material weakness in its internal control over its financial reporting." The guidance stemmed from a deficiency in the company's information technology controls regarding its newly implemented system, SunEdison said in a statement. Then, earlier this week, the Journal reported that the U.S. Securities and Exchange Commission (SEC) launched an investigation into whether the company overstated its liquidity last year when it announced it had approximately $1 billion in cash.The impending bankruptcy marks a Shakespearean fall for a company which had a market value of about $10 billion last summer and nearly $8 billion as of late September, according to SEC filings.Shares in SunEdison stood at 0.43, down 0.20 or 47.67% in after-hours trading, after paring some earlier losses. Over the last 52-weeks, shares in the company are down approximately 98%.