Month: October 2012

By TraderVox.com

Tradervox.com (Dublin) – Global central banks have added stimulus in their respective economies to spur growth. The European Central Bank have decided to start a bond buying program aimed at helping struggling countries to protect the borrowing cost. Further action has been seen from the Federal Reserve where it has resolved to embark on a third round of quantitative easing aimed at curbing the unemployment in the country. The strengthening yen has also forced the Bank of Japan to increase its asset purchases fund to 55 trillion yen. The additional stimulus by the central banks around the world is seen as coordinated action by global central banks to protect global economy from a recession.

The dollar index has dropped by 2.1 percent in the third quarter after decisions by the global central banks sent euro up against most of its traded counterparts. According to George Davis, the Chief Technical Analyst at Royal Bank of Canada in Toronto said that the European Central Bank decision to start a bond-buying process has shaped the market in the third quarter, terming it as an opening of a new chapter. The New Zealand dollar has increased the most against the US dollar among the major currencies, adding 3.3 percent in the last month. The euro has dropped by 0.7 percent against nine other major currencies while the Japanese currency has declined by 2.2 percent. The US dollar has declined by 4.3 percent.

The debt crisis in Euro Zone has forced the ECB to announce a bond buying program aimed at involving bonds with up to three years maturity period. This came as Spain and Italy benchmark yields reached above 6 percent. Spain has completed prepared an austerity budget aimed at cutting government spending. The market predicts that Spain will join other countries such as Greece, Portugal and Ireland in asking for international bailout.

The dollar has dropped by 1.5 percent in the last three months ending September to trade at 1.2866 against the euro.

Disclaimer
Tradervox.com is not giving advice nor is qualified or licensed to provide financial advice. You must seek guidance from your personal advisors before acting on this information. While we try to ensure that all of the information provided on this website is kept up-to-date and accurate we accept no responsibility for any use made of the information provided. Opinions expressed at Tradervox.com are those of the individual authors and do not necessarily represent the opinion of Tradervox.com or its management. 

Article provided by TraderVox.com
Tradervox.com is a Forex News Portal that provides real-time news and analysis relating to the Currency Markets.
News and analysis are produced throughout the day by our in-house staff.
Follow us on twitter: www.twitter.com/tradervox

London Gold Market Report
from Ben Traynor
BullionVault
Monday 1 October 2012, 07:30 EDT

SPOT MARKET gold bullion prices dipped below $1770 an ounce during Monday morning London trading, though they remained in line with the last fortnight’s price action, while European stock markets rallied along with the Euro following news late last week that the capital needs of Spain’s banks are within existing provisions.

“On the monthly chart, the bull trend remains intact, with uptrend support at $1594 and resistance at $1790, the previous high,” says technical analyst Russell Browne at Scotia Mocatta.

“[Gold seems] to have established a base now down at $1740,” adds Dave Govett, head of precious metals at brokerage Marex-Spectron.

“But we also seem to have a ceiling in place between $1785 and $1790…I think it will take some help from other markets to break us one way or the other…[but I] think that before long we will see a renewed assault on $1800.”

Silver bullion traded around $34.50 an ounce, in line with recent weeks, before easing  towards lunchtime, while other commodities were also flat.

Demand in India is “zero for silver”, one dealer told newswire Reuters this morning, adding that “demand is there in gold as it is the season”.

US Treasury bond prices gained during this morning’s trading, while prices for UK Gilts and German bunds fell after manufacturing data showed ongoing contraction in the Eurozone.

Sales of American Eagle gold investment coins by the US Mint rose by 75% last month compared to August. Last month’s sales were however the lowest for September since 2007, and were down nearly 25% from September 2011.

On the gold futures and options market meantime, the speculative net long position of Comex traders – measured as the difference between bullish and bearish contracts – rose to its highest recorded level since 6 September 2011 last Tuesday, weekly Commodity Futures Trading Commission data show.

“There has been a considerable slowing down in long positions added,” note the commodities team at Standard Bank.”

“As we’ve seen in the price behavior of gold over the past weeks, it takes very little to spur liquidation.”

The results of stress tests published Friday show seven of Spain’s banks need to be recapitalized, while another seven lenders passed. Several of those deemed to have inadequate capital to withstand severe market stress have already been nationalized.

In June, Spain’s government agreed a €100 billion credit line from Eurozone rescue funds to fund the recapitalizations, which the stress tests suggest will cost around €60 billion.

Spanish manufacturing activity shrank at an accelerated rate last month, according to purchasing managers index data published Monday. Manufacturing across the Eurozone as a whole also contracted, although less sharply than a month earlier, PMI data show.

The Eurozone unemployment rate remained at 11.4% for the second month in a row in August, its highest level since the financial crisis began in 2007, figures published this morning show.

“There is simply not enough growth in the Euro region to create sufficient jobs and the unemployment rate still has not reached its peak,” says Thomas Costerg, economist at Standard Chartered, speaking before the unemployment figures were released.

“A worrying trend is that the number of unemployed is now also expanding in core countries like Germany, which had been rather sheltered up to now.”

Here in the UK, manufacturing continued to contract last month, and at a slightly accelerated rate, PMI data published Monday show.

Figures from the Bank of England meantime show a drop in mortgage lending and consumer credit during August, while M4 money supply, the Bank’s preferred measure, rose 4.1% in the year to July.

US manufacturing PMI data are published later today.

Over in China, which is today celebrating National Day, manufacturing continued to contract last month, but less sharply than in August, official PMI data show.

China’s central bank has twice cut interest rates this year, and has also reduced the amount of reserves banks are required to hold. In addition, Beijing announced a 1 trillion Yuan infrastructure program last month.

“The policies implemented so far have failed to arrest a cyclical economic downturn,” says ANZ economist Liu Ligang, adding that “monetary easing and fiscal policy could accelerate” after the Communist Party congress next month, which will see a change of leadership.

“[The Party will want] to maintain social stability and a stable political transition.”

“With the political dust finally settled,” adds Bank of America Merrill Lynch economist Ting Lu,

“Chinese leaders will be forced to shift some efforts to counter the growth slowdown and deteriorating employment.”

India, traditionally the world’s biggest gold buying nation, is seeing a “booming” trade in recycled gold bullion, after drought forced some in rural areas to sell some of their gold, Reuters reports.

“There won’t be new demand from farmers and scrap will flow into the market,” says Prithviraj Kothari, president of the Bombay Bullion Association.

Recycled gold accounted for 57 tonnes of India’s gold supply last year, equivalent to 6.1% of total 2011 Indian gold demand, data published by the World Gold Council show. The bulk of supply, 969 tonnes, came in the form of imports. Authorities have twice raised the level of duty on gold imports since the start of the year.

“In coming years, 50% of the requirements will be met through scrap,” reckons Kothari.

Ben Traynor
BullionVault

Gold value calculator   |   Buy gold online at live prices

Editor of Gold News, the analysis and investment research site from world-leading gold ownership service BullionVault, Ben Traynor was formerly editor of the Fleet Street Letter, the UK’s longest-running investment letter. A Cambridge economics graduate, he is a professional writer and editor with a specialist interest in monetary economics. Ben writes and presents BullionVault’s weekly gold market summary on YouTube and can be found on Google+

(c) BullionVault 2012

Please Note: This article is to inform your thinking, not lead it. Only you can decide the best place for your money, and any decision you make will put your money at risk. Information or data included here may have already been overtaken by events – and must be verified elsewhere – should you choose to act on it.

Q3 was a rather good quarter for equities and Q4 might also be a good equity-quarter – especially on emerging markets, says Senior Strategist  Ib Fredslund Madsen.

Legal information

Video courtesy of en.jyskebank.tv

Article by AlgosysFx Forex Trading Solutions

Further worrying signs of a slowdown in the world’s three largest economies are foreseen to enhance demand for the US dollar opposite the Australian dollar today. Manufacturing gauges released earlier from both China and Japan revealed that weak demand continues to hamper factory conditions in both countries. Today, the US is awaited to release its own update on the manufacturing sector, and analysts say that the report is once again seen to disappoint.

The Institute for Supply Management is set to discharge the Manufacturing PMI for September, and many analysts are looking to see if the sector broke out of its three-month slump. Nonetheless, the markets received a forewarning last Friday when the Chicago PMI fell into a contraction for the first time in three years last month, with the index falling from 53.0 points to 49.7 points. The new orders index dropped 7.4 points to reach its lowest level since July 2009, just after the end of the recession. Employment also dropped to its weakest level in two-and-a-half years. As such, economists are eyeing today’s report with pessimism. Factory conditions across the US are projected to have contracted for the fourth consecutive month, with the Manufacturing PMI to edge up from 49.6 points to 49.8 points, still below the 50-level. Continuing debt turmoil in the Euro Zone and softening growth in other key economies are deterring foreign demand while the sluggish jobs market and uncertainty over the fiscal cliff are dampening domestic demand.

Elsewhere, the slowing global economy is likewise taking its toll on manufacturing conditions. Chinese manufacturing activity contracted for the second consecutive month in September according to official data, falling short of expectations of a modest expansion. The PMI came in at 49.8 points, a slight improvement from 49.2 points in August, but still failing to meet median forecasts of a rise to 50.2 points. China’s manufacturing sector has struggled as the country’s economy negotiates a slump that began last year. Global woes surrounding the European debt crisis and a weak US economy still suffering from high unemployment have been a drag on exports. Economic growth slowed to 7.6 percent in the second quarter to record its bleakest result in three years, and with various data continuing to disappoint, growth has likely slowed further in Q3.

The same story can be said for the world’s number 3 economy. A Bank of Japan survey revealed that falling export demand amid slowdowns in China and Europe is also taking its toll on Japanese manufacturers’ moods. The Tankan Manufacturing Index declined from -1 to -3 points in the third quarter to register its fourth consecutive negative reading. Exports have fallen for three months, plunging 22.9 percent in August to the European Union and 9.9 percent to China. Export growth is further threatened by a continuing row between Japan and China over islands in the East China Sea. With the gloom and doom presented by the global economy, pared risk appetites are presumed to strengthen the Greenback today, warranting a short position for the AUD/USD trades.

For more news, analysis, technical charts and candlestick analysis, visit AlgosysFx

Source: ForexYard

The US dollar saw gains against most of its main currency rivals before markets closed for the weekend on Friday, as concerns regarding Spanish debt continued to boost safe-haven currencies. Worries about Spain were also largely responsible for losses that both crude oil and gold took for the day. This week, all eyes will be focused on Friday’s US Non-Farm Payrolls report. With analysts predicting only a mild improvement over last month’s jobs figure, the USD may have a hard time maintaining its recent gains in the coming days. Additionally, traders will also want to pay attention to US manufacturing data today and the euro-zone Minimum Bid Rate on Thursday.

Economic News

USD – US Manufacturing Data Could Help Dollar Today

The US dollar was largely bullish against its main currency rivals on Friday, as euro-zone worries boosted safe-haven currencies. The USD/CHF gained more than 80 pips during European trading to trade as high as 0.9414 before experiencing a minor downward correction. The pair eventually closed out the week at 0.9400. Meanwhile, against the Japanese yen, the greenback was able to correct some of its losses from earlier in the week. The USD/JPY advanced close to 70 pips before peaking at 78.10 during afternoon trading. The pair finished out the day at 77.86.

Turning to this week, while investors will be eagerly awaiting Friday’s all-important US Non-Farm Payrolls figure, traders will not want to forget that there are other potentially impacting news events scheduled for the coming days. Today’s US ISM Manufacturing PMI is forecasted to show growth in the manufacturing sector from last month, which if true, could help the dollar extend Friday’s gains. Attention should also be given to a speech from the Fed Chairman today, the ISM Non-Manufacturing PMI on Wednesday and Thursday’s FOMC Meeting Minutes.

EUR – Span Worries Continue to Drive Euro Lower

The euro extended its recent bearish trend on Friday, as concerns regarding Spanish debt resulted in additional risk aversion among investors. The EUR/USD fell well over 100 pips for the day, eventually reaching as low as 1.2826, not far from a recent 2 ½ week low. The pair was able to finish out the week at 1.2853. Against the British pound, the euro started off the day on a strong note, gaining close to 50 pips to trade as high as 0.7993. That being said, a downward correction during afternoon trading erased all of the euro’s earlier gains. The common-currency closed the day at 0.7955.

This week, euro traders will want to continue monitoring developments out of Spain. Any sign that Spain is getting closer to requesting a bailout package from the ECB may boost the common-currency. In addition, Thursday’s euro-zone Minimum Bid Rate and ECB Press Conference are likely to provide important clues regarding the current state of the euro-zone economic recovery. Positive signs could help the euro recover some of its recent losses.

Gold – Gold Falls amid Risk Aversion

Risk aversion among investors due to uncertainties regarding Spain’s debt situation weighed down on the price of gold on Friday. Overall, the precious metal fell more than $15 an ounce to trade as low as $1767.07 during afternoon trading. A minor upward correction brought prices to $1771.80 before markets closed for the weekend.

This week, gold traders will want to pay attention to a batch of euro-zone and US news for clues as to the level of risk appetite among investors. Gold may recoup some of Friday’s losses if it appears that Spain is closer to requesting a bailout package. That being said, any better than expected news out of the US could lead to dollar gains, which may further weigh down on the price of gold.

Crude Oil – US Data Set to Impact Oil Prices

After falling more than $1 a barrel during the first half of the European session on Friday, crude oil was able to stage a modest recovery during the afternoon and evening sessions. The commodity traded as low as $91.37 before bouncing back to $92.44. Crude eventually finished out the week at $91.97.

This week, oil traders will want to monitor a batch of US news, most importantly Friday’s Non-Farm Payrolls figure. Additionally, the ISM Manufacturing PMI and Non-Manufacturing PMI and FOMC Meeting Minutes could all potentially have an impact on the price of oil. Better than expected news may signal to investors that demand for crude in the US will go up, which could boost prices.

Technical News

EUR/USD

While the Williams Percent Range on the daily chart has crossed over into oversold territory, most other long-term technical indicators place this pair in neutral territory. Traders may want to take a wait and see approach, as a clearer picture is likely to present itself in the near future.

GBP/USD

A bearish cross has recently formed on the weekly chart’s Slow Stochastic, indicating that a downward correction could occur in the coming days. Furthermore, the Williams Percent Range on the same chart has crossed over into overbought territory. Opening short positions may be the smart choice for this pair.

USD/JPY

In a sign that upward movement could occur in the near future, a bullish cross appears to be forming on the daily chart’s MACD/OsMA. That being said, most other technical indicators on the daily and weekly charts show this pair range trading. Taking a wait and see approach may be the smart choice.

USD/CHF

A bullish cross has formed on the weekly chart’s Slow Stochastic, signaling that this pair could see an upward correction in the coming days. Furthermore, the Williams Percent Range on the same chart is very close to dropping into oversold territory. Traders may want to open long positions for this pair.

The Wild Card

Coffee

The Bollinger Bands on the 8-hour chart are narrowing, signaling that a price shift could occur in the near future. Additionally, a bearish cross has formed on the same chart’s MACD/OsMA. This may be a good time for forex traders to open short positions ahead of a possible downward correction.

Forex Market Analysis provided by ForexYard.

© 2006 by FxYard Ltd

Disclaimer: Trading Foreign Exchange carries a high level of risk and may not be suitable for all investors. There is a possibility that you could sustain a loss of all of your investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with Foreign Exchange trading.

By The Sizemore Letter

Over the past month, I’ve maintained a bullish stance and have recommended that readers put their trading capital to work in some of the world’s more speculative markets (see “ECB Could Trigger Monster Rally in Spanish Stocks” and “Access Africa”).

Today, I’m going to reiterate my position that, in the age of competitive quantitative easing by the world’s central bankers, it makes sense to err on the side of bullishness.

The domestic news here in the United States continues to be lukewarm at best, China continues to revise its growth estimates downward, and the European Union is probably in outright recession.  But over the next several months, I do not expect any of this news to have much of an effect on global markets.  Bernanke, Draghi & Company have awakened the long-sleeping animal spirits in investors, and “Big Money” hedge fund managers and institutional investors are frantically trying to catch up to their benchmarks before the end of the year (according to Barron’s, the average equity-focused hedge fund has had a return barely half that of the passive S&P 500 in 2012).

This stimulus-fueled rally will eventually end, and when it does I expect it to end poorly.  But until we see signs of a real breakdown, it makes sense to maintain a bullish allocation.  I expect corrections—when they come—to consist of sideways action and not steep declines.  This has been the case for much of the past two weeks.

This week, I recommend investors take a look at India via the iPath MSCI India Index ETN ($INP).

India is generating a lot of buzz in recent weeks due to the proposed economic reforms of prime minister Manmohan Singh.  These reforms—which are needed for long-term growth—may or may not actually come to pass.  But in the short term, just the possibility is enough to restore some much needed confidence in the Indian market.

The usual caveats apply here; while I am bullish on emerging markets right now, sentiment can turn on a dime if Europe slides back into crisis.  Use a stop loss appropriate for your risk tolerance.

Disclosures: Sizemore Capital has no position in any security mentioned in this article. This article first appeared on TraderPlanet.

No related posts.

Source: ForexYard

The euro fell to a three-week low against the US dollar in overnight trading, as concerns about Spanish debt continued to draw investors to safe-haven assets. The common-currency fell as low as 1.2802 last night, before rebounding to its current level of 1.2867. After dropping close to $0.70 a barrel during the Asian session, crude oil was able to recoup most of its losses and currently stands at $91.86, virtually the same price as when markets opened for the week.

Main News for Today

US ISM Manufacturing PMI- 14:00 GMT
• The PMI is forecasted to come in at 49.8, slightly higher than last month’s figure
• Any better than expected news will likely boost investor confidence in the US economic recovery and could help the dollar extend its recent bullish trend

Fed Chairman Bernanke Speaks- 16:30 GMT
• Investors will be watching today’s speech for clues as to the current state of the US economic recovery
• Any positive comments from the Fed Chairman could help the dollar during afternoon trading

Read more forex news on our forex blog

Forex Market Analysis provided by ForexYard.

© 2006 by FxYard Ltd

Disclaimer: Trading Foreign Exchange carries a high level of risk and may not be suitable for all investors. There is a possibility that you could sustain a loss of all of your investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with Foreign Exchange trading.

By TraderVox.com

Tradervox.com (Dublin) – The Canadian dollar made the biggest quarterly advance against the greenback after global central banks added stimulus to spur global economic growth, spurring the demand for riskier assets. The loonie also increased in September after the Federal Reserve Bank embarked on a third round of quantitative easing program aimed at injecting $40billion each month to spur employment growth in US. The Canadian government bonds declined in the quarter after the Mario Draghi, the European Central Bank President, introduced a bond-buying program that have reduced the demand for safe haven assets. Economists are predicting a lowered employment growth in Canada last month.

Eric Lascelles, who is the Chief Economist at Royal Bank of Canada in Toronto, indicated last week that the third quarter has seen a lot of central banks in the world fighting back with policy makers delivering impressive promises. Eric showed optimism about global economy saying that the progress made in Europe and the performance of commodity related currencies is indicative of changing investor confidence in the market. The global stocks performance has also improved with the Standards and Poor’s Index increasing by 5.8 percent in the quarter; the index had registered a 3.3 percent decline in the previous quarter. The crude oil futures increased by 8.5 percent this quarter.

The Canadian dollar increased as the Bank of Canada held it lending rate at one percent, where it has been since September 2010. Mark Carney, the BOC Governor, said that an increase may be necessary as domestic product is driving the economic recovery which has been limited by global demand for exports. The Canadian dollar has improved by 3.4 percent in the quarter to trade at 98.37 cents per US dollar, making the largest gain since the first quarter in 2010. The loonie had dropped in the previous quarter by 1.8 percent. The currency has added 0.3 percent in September but made a weekly decline of 0.7 percent.

Disclaimer
Tradervox.com is not giving advice nor is qualified or licensed to provide financial advice. You must seek guidance from your personal advisors before acting on this information. While we try to ensure that all of the information provided on this website is kept up-to-date and accurate we accept no responsibility for any use made of the information provided. Opinions expressed at Tradervox.com are those of the individual authors and do not necessarily represent the opinion of Tradervox.com or its management. 

Article provided by TraderVox.com
Tradervox.com is a Forex News Portal that provides real-time news and analysis relating to the Currency Markets.
News and analysis are produced throughout the day by our in-house staff.
Follow us on twitter: www.twitter.com/tradervox

By Central Bank News
Here’s today’s Central Bank News link list, click through if you missed the previous link list. The list comprises news about central banks that is not covered by Central Bank News. The list is updated during the day with the latest developments so readers don’t miss any important news.

By Central Bank News