Month: March 2011

Microsoft (MSFT) is going to stop producing new versions of its Zune music and video player due to weak demand, Bloomberg reports. Bloomberg cited a person familiar with the decision, who said a move away from the Zune will the let the company shift its focus to other devices.

Google (GOOG) shares are down while Bloomberg reports that the Internet company plans to start testing a service that lets users ring up purchases using their phones. Citing two people familiar with the deal, the report says that the company will pay for installation of thousands of specialized cash register systems from VeriFone (PAY). The trial will take place in New York and San Francisco within four months. Google shares are down 0.96%, or $5.49, to $564.29.

The Washington Post is reporting that Japan’s Nikkei 225 recorded one of its largest-ever drops, closing at 8605.15 — down 10.55 percent. Coupled with Monday’s 6.2 percent drop, the index has plummeted nearly 17 points in the first two business days since the recent disaster. Many of the losses were due to a rapid sell-off that occurred right as Naoto Kan warned about the radiation risks following the crisis at the Fukushima Daiichi power plant.

Written by FastBrokers House

With the situation at the Fukushima Dai-Ichi nuclear plant having taken a further turn for the worse, so general risk-aversion has picked up. European stocks have followed their Asian counterparts trading sharply lower.

EUR/USD down at 1.3880 from early 1.3930, having been as low as 1.3852 after stops tripped through 1.3890.  The release of weaker than expected ZEW data (see above) didn’t help matters.

USD/JPY down at 81.35 from early 81.55. It has to be said that given all that’s been going on it’s been admirably steady.

Buy orders, including Japanese importer interest (especially oil companies,) noted down at 80.80/81.20.  Sell orders clustered 82.05/25 and more up at 82.45/50.  Buy stops gathering in 82.50/60 area.

USD/CHF down at .9210 from early .9235, EUR/CHF down at 1.2790 from around 1.2870. Swiss benefiting for it’s well-documented safe haven status as risk aversion picks up.  Real money was seen aggressively buying Swissy on the crosses this morning.

AUD/USD down at .9885 from early .9970 against the backdrop of raised risked aversion. Model funds very notable sellers right from the get go.

Cable has given up about a cent. Down at 1.6005 from early 1.6115, having been as low as 1.5980.

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Senior strategist Ib Fredslund Madsen provides the overview on a day where investors have been watching the situation in Japan carefully.

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Video courtesy of en.jyskebank.tv

March 15 (Bloomberg) — Uwe Parpart, chief economist and strategist for Asia at Cantor Fitzgerald HK Capital Markets, talks about the cost of reconstruction in Japan following the earthquake and tsunami. He speaks with Mark Barton on Bloomberg Television’s “Countdown.”

Energy shares are firmly lower in pre-market trading as crude oil futures fall to trade below $99 a barrel. Stocks in the sector are weighed by investor concern over the effects of the earthquake in Japan at the end of last week and the potential crisis with nuclear facilities hit by the disaster. SunPower (SPWRA, SPWRB) says Japanese suppliers have indicated that, while certain operations are currently disrupted due to infrastructure issues, they have not sustained major damage to their facilities. Sunpower shares are up 2% in pre-market trading. Meanwhile, Madison Williams reportedly downgraded TransAtlantic Petroleum (TAT) to Accumulate from Buy. The firm cited relative valuation.

A snapshot of the European Morning Briefing covering Stocks, Bonds, FX. Main focus of the markets today is Japan and further explosions at nuclear power plant.

Volatility was higher than usual in the FX markets with global bourses sliding. The crisis in Japan is influencing interrelated markets as the Aussie dollar and Canadian dollar sold off sharply while the Japanese yen and the greenback strengthened.

The AUD/USD traded as low as 0.9814 but paired its losses to open the New York trading session at 0.9860. The pair began the day trading at 0.9964. The USD/CAD climbed as high as 0.9973 before falling back to 0.9980. The opening day price for the pair was at 0.9812.

The AUD/USD has found support at the January low of 0.9800. A breach below this level could spur further selling of the pair to the November low at 0.9530. Resistance comes in at 0.9970. For the USD/CAD, resistance is found at today’s high of 0.9973 followed by the January high at 1.0060. Support is located at 0.9800.

The USD/JPY was trading near its lows for the day at 80.85 after opening at 81.44. The pair should continue to move lower towards the October low at 80.20. Resistance is yesterday’s high at 82.40.

Frightened traders looked for safe haven assets during the European trading session and moved into long dollar and long yen positions as an intensifying situation in Japan has risk aversion at a peak for the year. Global bourses were lower across the board with the Nikkei 225 falling 10.55%. The FTSE was down 2.28%. At the opening of the New York trading session the Dow Jones Industrials Average was down 2.3%.

Driving the indices and the currencies lower are fears of a nuclear accident in three Japanese power plants damaged in the tsunami. Also pushing the yen to new highs are increased expected costs from the cleanup. Due to the Japanese crisis, traders are shifting their interest rate expectations in developed nations as central banks may begin to tone down their hawkish rhetoric.

At this stage today’s US interest rate announcement seems to be a minor event on the economic calendar as the Fed is not expected to change its current position on the US economic recovery or US interest rate expectations.

A third explosion occurred at the troubled nuclear complex in Japan, causing radioactive substances to be emitted from the facility and radiation levels outside the facility to jump to more than eight times permitted levels, Tokyo Electric Power officials said. In a nationally televised statement, Prime Minister Naoto Kan said radiation has spread from the four stricken reactors of the Fukushima Dai-ichi nuclear plant along Japan’s northeastern coast. The region was shattered by Friday’s 9.0-magnitude earthquake and the ensuing tsunami that is believed to have killed more than 10,000 people, plunged millions into misery and pummeled the world’s third-largest economy.