Daily FX Commentary: (Morning Report)
EUR/USD
No changes in the near-term price action seen in past couple of sessions, as the pair remains in a sideways mode, entrenched within narrowed 1.3264/1.3370 range. Studies on 1 and 4h charts hold neutral mode, with break of either side to signal fresh direction, however, clearance of the wider range boundaries at 1.3255 and 1.3400, is required to confirm.
Res: 1.3350, 1.3370, 1.3386, 1.3400
Sup: 1.3300, 1.3280, 1.3264, 1.3255
GBP/USD
Cable holds 1.5800/1.5900 in past three-days, after finding temporary ground at psychological 1.5800 level. However, near-term tone remains aligned to the downside, as recovery attempts were capped under initial 1.5900 resistance, by descending hourly 20 day EMA and Fib 38.2% of 1.6038/1.5801 descend. Improvement of the near-term structure required break above minimum 1.5950, Fib 61.8% and 55 day EMA, to avert immediate downside risk of losing 1.5800 handle that may accelerate bears towards 1.5750 and 1.5700.
Res: 1.5851, 1.5882, 1.5891, 1.5900
Sup: 1.5811, 1.5801, 1.5753, 1.5700
USD/JPY
Bounce from 88.00, where the price find support, reduces downside pressure, as gains through psychological 89.00 barrier, retraced over 61.8% of 90.23/88.05 fall at 89.44. Improved hourly structure sees potential for stronger recovery, however, still weak studies on 4h chart, require regain of 90.00, to confirm recovery and re-focus 90.23 peak. Psychological 89.00 level now offers support and is reinforced by 4h Ichimoku cloud top and 20/55 day EMA’s bullish crossover, with break here to weaken the structure.
Res: 89.44, 89.72, 90.00, 90.10
Sup: 89.00, 88.87, 88.63, 88.40
USD/CHF
Recovery attempt off 0.9270 zone, where the pair found support, cracks 0.9300 barrier and 0.9317, Fib 38.2% of 0.9387/0.9274 decline, signaling possible further extension higher, as hourly studies turned positive. With 4h structure gaining momentum,. Scope is seen for attempt towards 0.9350 breakpoint, previous highs and Fib 61.8%, to confirm base at 0.9280/70 zone and re-focus 0.9387 and 0.9400.
Res: 0.9319, 0.9330, 0.9350, 0.9387
Sup: 0.9300, 0.9283, 0.9273, 0.9248
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Daily Market Commentary: (Evening Report)
Footsie jumps one per cent as economic data impresses
Market Movers
techMARK 2,246.01 +0.71%
FTSE 100 6,264.91 +1.09%
FTSE 250 13,066.44 +1.02%
Market Movers
techMARK 2,246.01 +0.71%
FTSE 100 6,264.91 +1.09%
FTSE 250 13,066.44 +1.02%
Better-than-expected economic data lifted the FTSE 100 over one per cent higher on Thursday afternoon, as markets shrugged off disappointing results from the world’s largest technology company,Apple.
American jobless claims and a US manufacturing survey from Markit came in better than forecasts today, sending London’s benchmark index surge in afternoon trade. Meanwhile, the Conference Board’s composite index of leading indicators increased by 0.5% in December, better than the +0.4% expected.
“All three releases have fuelled hopes for a strong recovery in the US allied with growing optimism that US lawmakers do have the will to agree on spending cuts and raise the debt ceiling without playing the same game of brinkmanship they participated in before the end of 2012,” said market strategist Ishaq Siddiqi from ETX Capital.
The S&P 500 in New York topped 1,500 following the news, the first time it has reached that level since 2007. The Dow also rose strongly, though the tech-heavy Nasdaq was being weighed down by a 10% drop from iPhone maker Apple after both revenues and profits missed forecasts.
Better-than-expected economic figures from Europe and China also lifted the mood today: the Chinese HSBC flash manufacturing purchasing managers' index (PMI) rose from 51.5 to a two-year high of 51.9 in January (consensus: 51.7); meanwhile, the Eurozone composite PMI increased from 47.2 to 48.2 in December (consensus: 47.5).
ETX Capital’s Siddiqi highlighted this afternoon that the FTSE 100 was outperforming other European indices today. He said: “Traders are citing rumours around tomorrow's Q4 GDP figures but it must be noted that the FTSE100 did underperform its European peers in 2012 so technically, there is plenty of room for upside. We are likely to see the index catch up with European peers through this year, especially if we continue to see more encouraging signs from China, the world's biggest consumer of commodities.”
Consensus forecasts are for a 0.1% quarter-on-quarter contraction in the UK economy in the fourth quarter of 2012, compared with the 0.9% growth seen in the third.
American jobless claims and a US manufacturing survey from Markit came in better than forecasts today, sending London’s benchmark index surge in afternoon trade. Meanwhile, the Conference Board’s composite index of leading indicators increased by 0.5% in December, better than the +0.4% expected.
“All three releases have fuelled hopes for a strong recovery in the US allied with growing optimism that US lawmakers do have the will to agree on spending cuts and raise the debt ceiling without playing the same game of brinkmanship they participated in before the end of 2012,” said market strategist Ishaq Siddiqi from ETX Capital.
The S&P 500 in New York topped 1,500 following the news, the first time it has reached that level since 2007. The Dow also rose strongly, though the tech-heavy Nasdaq was being weighed down by a 10% drop from iPhone maker Apple after both revenues and profits missed forecasts.
Better-than-expected economic figures from Europe and China also lifted the mood today: the Chinese HSBC flash manufacturing purchasing managers' index (PMI) rose from 51.5 to a two-year high of 51.9 in January (consensus: 51.7); meanwhile, the Eurozone composite PMI increased from 47.2 to 48.2 in December (consensus: 47.5).
ETX Capital’s Siddiqi highlighted this afternoon that the FTSE 100 was outperforming other European indices today. He said: “Traders are citing rumours around tomorrow's Q4 GDP figures but it must be noted that the FTSE100 did underperform its European peers in 2012 so technically, there is plenty of room for upside. We are likely to see the index catch up with European peers through this year, especially if we continue to see more encouraging signs from China, the world's biggest consumer of commodities.”
Consensus forecasts are for a 0.1% quarter-on-quarter contraction in the UK economy in the fourth quarter of 2012, compared with the 0.9% growth seen in the third.
Europe Market Report
European Markets Climbed On Economic Data
The European markets finished Thursday's session in positive territory. Positive Chinese manufacturing data helped to overshadow some of the weakness caused by the disappointing earnings report from Apple in the United States. The Euro area private sector activity result also lifted hopes for a modest recovery in the region.
China's manufacturing sector activity rose to its highest level in two years in January as factory production picked up momentum, preliminary results of a survey by Markit Economics showed Thursday. The headline HSBC/Markit purchasing managers' index rose to 51.9 in January from 51.5 in December.
The marked improvement in Eurozone consumer confidence, as latest data showed, adds to hopes that the region's economy could at least stabilize in the first quarter, following an almost certain third successive quarter of contraction in the fourth quarter, IHS Global Insight Chief European and UK Economist Howard Archer said Thursday.
IHS Global Insight noted that the appreciable improvement in sentiment shows that Eurozone consumers are starting to become more upbeat about the economic outlook, although they still clearly have serious concerns over jobs.
The upturn adds to the evidence that the economic environment in the single-currency bloc has improved, and growth prospects are brightening following recent policy initiatives that have resulted in a substantial easing in sovereign debt tensions, the firm noted.
Bank of Canada Governor Mark Carney, next chief of the Bank of England said the governor should not overshadow the decisions of the central bank. At a press conference, Carney said he aims to ensure that the policy decisions do not rely too much on any particular individual.
"Part of my responsibility when I am there is that as the Bank of England gets additional responsibilities on the micro and macro prudential side, to ensure that the committee structure, the new governance structure, the other aspects, work to their full effect," he said.
The Euro Stoxx 50 index of eurozone bluechip stocks increased by 0.49 percent, while the Stoxx Europe 50 index, which includes some major U.K. companies, added 0.17 percent.
The DAX of Germany climbed by 0.53 percent and the CAC 40 of France advanced by 0.70 percent. TheFTSE 100 of the U.K. rose by 1.09 percent and the SMI of Switzerland gained 0.89 percent.
In Frankfurt, Commerzbank rose by 1.41 percent. The lender said it plans to slash 4000 to 6000 jobs at the Group level until 2016, with the exact amount of the reduction to be known after talks with the employee representatives.
US Market Report
Stocks are extending a recent upward move during trading on Thursday, with the S&P 500 climbing above 1,500 for the first time in over five years. However, a sharp drop by shares of Apple (AAPL) has helped to keep the tech-heavy Nasdaq in the red.
The major averages currently continue to turn in a mixed performance, with the Nasdaq posting a modest loss. While the Nasdaq is down 2.69 points or 0.1 percent at 3,150.98, the Dow is up 85.43 points or 0.6 percent at 13,864.76 and the S&P 500 is up 5.68 points or 0.4 percent at 1,500.49.
The modest loss being posted by the Nasdaq is due in large part to the steep loss being posted by Apple, with the iPad and iPhone maker down by 10.4 percent after reporting disappointing quarterly results.
After the close of trading on Wednesday, Apple reported better than expected first quarter earnings but on weaker than expected sales. The company also reported iPhone sales that missed expectations and provided disappointing second quarter revenue guidance.
Meanwhile, most stocks have moved to the upside on the heels of the release of a report from the Labor Department showing that initial Jobless Claims unexpectedly fell to a new five-year low in the week ended January 19th.
The report showed that initial jobless claims dipped to 330,000, a decrease of 5,000 from the previous week's unrevised figure of 335,000. The drop surprised economists, who had expected jobless claims to climb to 355,000.
With the unexpected decrease, jobless claims fell to their lowest level since hitting 318,000 in the week ended January 19, 2008.
While the Labor Department said seasonal distortions are likely still in effect, Jennifer Lee, senior economist at BMO Capital, said the news on the job front is encouraging "even when you remove all of the noise."
Other Markets
In overseas trading, stock markets across the Asia-Pacific region turned in yet another mixed performance during trading on Thursday. While Japan's Nikkei 225 Index surged up by 1.3 percent, China's Shanghai Composite Index fell by 0.8 percent.
In the bond market, treasuries have slid firmly into the red on the heels of the upbeat jobs data. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 2.8 basis points at 1.861 percent.
In overseas trading, stock markets across the Asia-Pacific region turned in yet another mixed performance during trading on Thursday. While Japan's Nikkei 225 Index surged up by 1.3 percent, China's Shanghai Composite Index fell by 0.8 percent.
In the bond market, treasuries have slid firmly into the red on the heels of the upbeat jobs data. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 2.8 basis points at 1.861 percent.
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