Month: January 2012

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Source: ForexYard

While the euro saw some upward momentum in trading last week, the real test of the currency’s strength will be today, as news of a possible deal on Greek debt is announced. Traders will want to pay close attention to the planned meeting of euro-zone finance ministers scheduled for later in the day. If Greece successfully reaches a deal with its creditors regarding its debt before the meeting, the euro may receive a significant boost in afternoon trading.

Economic News

USD – Dollar Likely to See Significant Movement in Heavy News Week

The US dollar took some pretty significant losses against its main currency rivals last week, as investors decided to move their funds to riskier assets. Currencies like the EUR, AUD and NZD saw gains against the greenback after successful debt auctions in France and Spain boosted hopes for a future euro-zone economic recovery.

Following last week’s bearish movement, the USD is forecasted to see a fair amount of volatility in the coming days, as several major economic indicators are scheduled to be released. Most importantly, traders will want to pay attention to Wednesday’s FOMC Statement, as it is likely to give clues as to when the US will raise national interest rates. Any signs that the Federal Reserve will raise rates in the coming months could generate some risk taking in the markets, which would likely cause the greenback to extend its recent losses. At the same time, should the Fed fail to announce concrete plans for an interest rate hike, safe haven currencies like the dollar could see a boost.

Turning to today, all eyes will be on the meeting of euro-zone finance ministers and any news regarding a possible Greek debt-swap deal. The EUR/USD closed a bullish run last week fairly close to the psychologically significant 1.3000 level. Should Greece announce that a deal has been reached with regards to its debt, the dollar is likely to fall further against the common currency.

EUR – Traders Anxious to See if EUR Can Extend Bullish Run

Following last week’s bullish movement, traders are anxious to see if the euro can maintain its current trend this week. Successful Spanish and French debt auctions last week helped spur risk taking which led to the common currency’s upward momentum. The EUR/USD closed the week above the 1.2900 level, far above its recent 17-month low. That being said, analysts are quick to warn that it will take significantly better news to get the pair trading toward the 1.4000 level again.

Today, traders will find out if last week’s upward movement was temporary or represented a real reversal for the euro. A possible Greek debt-swap deal is forecasted to be announced ahead of a planned meeting of euro-zone finance ministers. The euro will likely see significant bullish momentum if Greece announces a deal which would prevent it from defaulting on its debt. At the same time, if Greece fails to reach a deal with its creditors, investors may revert back to safe haven currencies like the US dollar.

JPY – Yen Takes Losses Following Boost in Risk Taking

The yen was bearish for much of last week, following positive euro-zone news last week that boosted risk taking among investors. Losses were taken against many of its main currency rivals, including the euro and British pound. The EUR/JPY closed on Friday at 99.62, up almost 250 pips for the week. Similarly, the GBP/JPY saw significant upward movement to close out the week at 119.93.

Today, yen movement will likely be determined by euro-zone news, specifically on whether Greece will reach a deal with its creditors before defaulting on its debt. A successful deal may lead to risk taking among investors which could mean additional downward movement for the yen. Later in the week, traders will want to pay attention to Tuesday’s Japanese Monetary Policy Statement. The statement is meant to illustrate the current state of the Japanese economy, including any future interest rate hikes. Traders can expect volatility following its release.

Crude Oil – Crude Oil Tumbles to Close Out the Week

Friday saw the price of crude oil tumble, as traders unloaded their positions before the February contract expired. Questions regarding Greece’s possible debt swap deal also caused prices to slip as low as $98 a barrel. The commodity eventually closed trading for the weekend at $98.42.

Today’s meeting of euro-zone finance ministers is likely to influence the price of crude. If investors are convinced that the euro-zone can stage a meaningful recovery in the near future, risk taking will likely ensue and crude could see some bullish movement. Traders will also want to continue monitoring the state of Middle East tensions this week. Conflict in the Middle East typically leads to supply side fears which drive up the price of oil. Any escalation in the ongoing situation between Iran and the West is likely to lead to major upward movement for crude.

Technical News

EUR/USD

Long term technical indicators are showing this pair in oversold territory, meaning that an upward correction could take place in the coming days. The weekly chart’s Relative Strength Index is currently at 20, while the Williams Percent Range on the same chart has dropped below the -80 level. Going long may be a wise strategy for the pair.

GBP/USD

According to technical indicators on the daily chart, this pair has breached the overbought zone, and could see a downward correction in the near future. A bearish cross has formed on the Stochastic Slow and the Williams Percent Range has gone above -10. Traders may want to go short on this pair.

USD/JPY

Technical indicators on both the daily and weekly charts are showing this pair in neutral territory, meaning that no defined trend is apparent at this time. Traders may want to take a wait and see approach for the pair, as a clearer picture may present itself in the near future.

USD/CHF

The daily chart’s technical indicators are showing that following last week’s bearish movement, the USD/CHF may see an upward correction in the near future. The Stochastic Slow has formed a bullish cross, while the Williams Percent Range is hovering in the oversold zone. Going long may prove to be a wise choice.

The Wild Card

GBP/JPY

Technical indicators are showing that following this pair’s recent bullish movement, a downward correction may take place in the near future. The Stochastic Slow on the daily chart appears to be forming a bearish cross, while the 8-hour chart’s Relative Strength Index has drifted into the overbought zone. Forex traders may want to go short in their positions ahead of a downward breach.

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.

January 22nd, 2012:  AUD/JPY pair seems to get some life after many days. The currency pair broke over the resistance of 79.75 first and then 80.52 and then it moved to 80.87. Now we look forward to some more upward move towards 81.40/81.50. On the upside any strong break over 81.50 should take AUDJPY towards the next resistance zone between 82.45 to 82.80.

On the downside, now, any break below 79.40 will make the short-term outlook neutral again and in that case we shall look for some more downward moves but with frequent supports till the currency pair breaks below 77.85. But this neutral outlook will start becoming bearish only with a break of 76.98/76.95.

You may also check daily technical analysis of aud/jpy and the weekend audjpy forecast at ForexAbode.com.

By MoneyMorning.com.au

In August 2010 Kris asked if an Aussie Icon was on the ropes…

Back then, Kris laughed at broking firm, Morgan Stanley’s price target for Qantas [ASX: QAN] of $3.05. Turns out he was right to laugh. The stock didn’t get there.

And now, it’s now trading at $1.52 – just above its three-year low.

The other big airline stock, Virgin Blue [ASX: VAH], hasn’t done much better. Since Kris told his Australian Small-Cap Investigator readers to sell the stock, locking in a 100% gain in early 2010, the price has halved:

You can see the long-term share price performance of both companies in the chart below (Qantas – blue line; Virgin – pink line):

The bad news continued into 2011, with both stocks taking a beating. That’s despite revenue for both companies being higher this financial year, passenger numbers for the two airlines were up 3% in November over the previous year.

That said it’s been a tough year for airline shareholders.

Or has it?

In less than six weeks since listing on the Australian Securities Exchange, Alliance Airways [ASX: AQZ] has gained more than 7.5%.

And recently Credit Suisse set an ambitious price target of $2.38 per share by the end of this year…

Is it possible?

It might be. But the rising stock price relies heavily on the mining boom. That is, the company has a small fleet of planes that specialise in dropping ‘Fly-In, Fly-Out’ (FIFO) workers, most commonly mining employees, at their work sites.

By August last year, of the 90,000 resource industry employees in Western Australia, over 52% were FIFO. And the West Australian government reckons in less than three years, FIFO workers will make up more than 57% of the resources work force.

And that growth estimate is just for workers on the west coast of Oz.

But it’s not just WA that Alliance Airways covers.

If you can name a dense mineral deposit, they’ll fly there. As this chart of the Alliance route map shows:

And there’s another benefit of running an aviation business that benefits from the mining boom.

Unlike retail airlines, an empty aircraft isn’t a risk for them. That is, they charge a mining company the same flat rate per flight. Passing on the responsibility of filling an aircraft to the mining company. Empty plane or not, Alliance gets the same fee.

But what if the mining boom in Australia comes to a quick end? Well, the company has aircraft that can reach as far as the South China Sea and to our cousins across the ditch in New Zealand.

They’ve ensured the business is viable outside Australia by building up a small fleet of planes capable of flying internationally.

But for now, if the mining boom slows… and the need for FIFO workers dries up… the Alliance share price could see a fall similar to Qantas and Virgin.

There’s one more thing that could hold Alliance back should the ‘digging up rocks’ boom in Australia end. Alliance doesn’t have a retail market like the big two airlines. Alliance pretty much flies to big holes in the ground… and it’s hard to imagine these becoming tourist hot spots!

Right now, the S&P/ASX 300 Metal & Mining index is down 21% since this time last year. But in the last few weeks, it has gone back up. Given Alliance’s dependence on the mining boom, any change in the demand for resources – and, therefore, workers – will drive the share price.

And perhaps not surprisingly, for the few short weeks it’s been trading, the airline has tracked this index…

…A pattern that seems set to continue given the company’s relationship to the mining sector.

In short, a bet on Alliance Airways is simply a bet on the resources boom kicking on. If the mining companies keep turning a profit it seems likely Alliance will too.

Shae Smith
Editor, Money Weekend

The Only Airline Stock Worth Buying This Year?

Source: ForexYard

According to the International Monetary Fund (IMF), Britain’s economy is set to slump by a massive 2.8% this year. The global economic watchdog was extremely concerned, as this forecast indicates that Britain’s economy will decline twice as fast as previously predicted. Therefore, Britain’s economy is set to shrink more than that of the Euro-Zone, the United States and Japan. This data is likely to kick-in when the Bank of England (BoE) meets next week and cuts Britain’s Interest rates. The consequence of this is highly likely to lead to a further weakening of the Pound Sterling.

The IMF data has sparked worries across the financial world, as London is seen as 1 of the top 3 global financial capitals, along with New York and Frankfurt. The Pound may therefore weaken as the financial crisis continues to take its toll on the British economy. It is true that every advanced country in the world is suffering from the global economic downturn. However, Britain has been hit severely largely due to her previously strong banking and energy sector.

Since the commencement of the global financial crisis, banks around the world and Oil prices have been hit significantly. For example, the British government increased its stake in the Royal Bank of Scotland (RBS) last week, which sparked renewed fears of the nationalization of Britain’s banking sector. Additionally, the price of Crude Oil has slid from as high as $147 a barrel back in July, to $41 today. Britain has felt the brunt of the global recession more than any other country in the developed world, owing to its dependence on these 2 sectors. Also, the Pound sterling has felt the knock-on effects, as the British currency has tumbled against the Dollar and Euro in recent months.

A couple of months ago, the Pound against the Euro and Dollar stood at €1.53 and $2.11 respectively. However, the GBP’s rate vs. these 2 currencies currently stands at €1.078 and $1.43. The British government and the Bank of England (BoE) have run out of things to do to stimulate Britain’s economy. Things have gotten so bad in Britain that the opposition Conservative Party has opened a double-digit lead in most polls. In the short-medium term, the Pound is likely to decline against most of its major currency pairs. If you want to learn more about the current global economic situation and the forex market, you can start trading with our standard account, please visit ForexYard.

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 MoneyMorning.com.au

The bulls’ case for buying emerging markets this year is simple.

Emerging markets might not be as cheap as they once were compared to developed markets. But at least they represent countries that are showing some real GDP growth.

Buy stocks in the West and you are buying into ex-growth economies paralysed by political failure, private debt and popular denial.

Buy into emerging markets and you are buying high-growth economies with either vibrant democracies (India) or command governments skilled in economic manipulations (China). Case closed.

Or is it? We aren’t so sure.

Emerging Markets Aren’t Cheap Enough

It used to be that you could buy most of them purely on the basis that they were cheap. When developed markets traded on average price to earnings (p/e) ratios of seven to nine times and developed markets traded at around 17 times, it all made sense. By buying emerging markets, you were making a perfectly sensible convergence trade.

Buy them today and you are not doing anything of the sort. The developed market premium is tiny. It’s barely enough to compensate the investor for the higher governance risk in the average emerging market.

This matters. Yes, emerging market economies are still growing faster than those in the West. But as we always point out, economic performance is no real guide to stock market performance.

Short-term performance is about money flows; long-term performance is about price (the cheaper you buy, the better the long-term return).

On top of this, it isn’t a given that the performance of emerging economies is going to be that great this year anyway. In fact, they look pretty “poorly positioned in a low growth world”, as Deutsche Bank puts it.

We know that China’s economy is at best slowing softly and at worst already in the middle of a hard landing. That will have a nasty impact on the commodity-dependent economies (such as Brazil and Australia’s economy).

We also know that the East has in no way yet decoupled from the West: China may want consumption to drive its growth, but the empty shopping malls and unsold apartment blocks across the country tell a clear story of investment running way ahead of demand.

Emerging Markets Are a Product of the Credit Bubble

The truth is that much of the growth in emerging market economies in the last few years has been as much about a massive credit and liquidity cycle (just like the ones we saw in the US in the 2000s and Japan in the 1980s) as anything else.

Consider credit-to-GDP ratios. Start with an index of one in 1996 and, according to numbers from SLJ Partners, the ratios for Brazil, Russia, India and Turkey have now risen to 1.7, 5.8, 2.1 and 3.0 respectively.

China is tougher to figure out, thanks to the huge shadow banking system – off-balance-sheet lending could be 25% of GDP – but SLJ puts the increase in China’s ratio at about 85%.

In other words, the importance of credit to the growth of all the emerging market economies has surged in the past decade or so. These cycles have been driven in part by domestic lending, but also by huge foreign inflows, which in turn were driven by loose monetary policies in the US, UK and Japan.

In the three years up to 2008, the cumulative capital flows going into emerging markets reached $70bn. Now they are up to $187bn. Yet that wall of money hasn’t delivered investors good returns over the last few years.

You can argue about why this is the case indefinitely. It could be about price. It could be about monetary tightening in China. Or it could be down to the fact that the massive new supply of equity from listings of state-controlled companies has swamped demand.

But the key point is that its withdrawal will all but guarantee far worse returns.

Swap Your Emerging Market Currencies for Dollars

First up is more of a slowdown in developed markets. This is a pretty strong possibility given the state of the eurozone. Even the World Bank is now prepared to recognise this as a threat. It warned this week that “escalation of the crisis” in Europe “would spare no one” and cut its forecast for emerging market GDP growth in 2012 from 6.2% to 5.4%.

Second that money stops flooding into emerging markets as deleveraging continues across the West. Note that there was a decline in Chinese foreign reserves in the last quarter of 2011 for the first time since 1998.

And third is a “more assertive US dollar” continuing to challenge the view that emerging currencies are the place to be. The dollar isn’t expensive anymore (the fundamentals may not have improved, but remember that currencies are all relative). Any cyclical turndown in emerging markets, “even if China avoids a hard landing”, could lead “to a powerful rally in the dollar” against most emerging market currencies.

We’ve been in favour of holding some exposure to emerging market currencies for some time now. However, we doubt China can avoid a hard landing. We are also concerned that the credit cycle that has been driving emerging market growth is getting a little long in the tooth.

So it might be a good time to think about taking some profits and recycling them into dollar holdings.

Otherwise, you could try and protect yourself in the same way that Chinese investors are – by buying gold. As our Australia-based colleague Greg Canavan points out, China’s imports of physical gold via Hong Kong have soared in recent months. In November alone, gold imports totalled nearly 103,000kg.

“Are Chinese citizens trying to protect themselves from falling property and equity markets? With deposit rates less than the inflation rate, there’s no respite by placing funds in the banks either. Gold seems like a sensible option.”

Merryn Somerset Webb
Editor-in-Chief, MoneyWeek (UK)

Publisher’s Note: This is an edited version of an article that first appeared in Money Morning (UK)

From the Archives…

Are ASX Energy Index Stocks Worth The Risk?
2012-01-20 – Aaron Tyrrell

Why the World Bank Wants Your Money
2012-01-19 – Kris Sayce

Could $50 Billion In Unpaid Credit Card Debt Drag Aussie Bank Stocks To A Record Low?
2012-01-18 – Aaron Tyrrell

The US-China Power Struggle… and What it Could Mean For Oil and Australian Energy Stocks
2012-01-17 – Dr. Alex Cowie

How Global Oil Supplies Could Fall 40% Overnight
2012-01-16 – Dr. Alex Cowie

How To Cash In As Investors Flee Emerging Markets

By MoneyMorning.com.au

2011 was a tough year for commodity investors.

Only a handful of major commodities rose over the year. So what were they?

Gold was the best performer, rising 10%. This completes 11 straight years of consecutive gains for the metal, making it one of the longest unbroken bull markets in history.

There were just a few other commodities that made any sort of gain last year. These included crude oil, which was up by 8.2%. Coal was up 5.7%. And corn scraped in with a 2.8% gain. It was slim pickings.

Precious metals, energy and food did better than most.

Almost all other major commodities fell. All the base metals, like copper, nickel and zinc, fell. That’s because these metals are used in industries, such as manufacturing and construction, that were slowing down. Zinc had one of the worst performances in 2011, down by 25%. Tin doesn’t show up on the chart, as it is too small a market for this list, but fared even worse with a 30% drop in price.

This chart shows how the major commodities have ranked for each of the last five years.

We’ve cut the list to the last five years to make it easier to read. Click here if you’d like to see the record over the last 10 years.

The first thing to notice is just how much the gains and losses can jump around each year. Take zinc (Zn). During four of the last five years it did terribly. It lost nearly half its value in 2007 when everything else was soaring. But then in 2009 it more than doubled, jumping 129.4%.

Then look at silver. Up 14.6% in 2007, then down 23% in 2008, up 48.2% in 2009, up another 83.2% 2010, then down 9.9% last year. All over the place! But the net result was that silver doubled in price in this time.

Since the start of this year, silver has come back to life in a big way. I wrote about silver in Money Morning two weeks ago, explaining why I think 2012 will be big year for silver.

It’s been an exciting few weeks for the metal, with prices up 10% since then. There have been some big daily jumps. The silver price exploded out of the gate during US trading on Friday, putting on 5%.

The reason for the sudden jump is Eric Sprott (he runs a silver fund out of Canada) is planning to buy an extra $300 million worth of silver on behalf of clients. This is not much when you consider that there is around $50 billion worth of silver bullion available. Sprott is trying to buy just 0.6% of the market. For silver to move 5% on the news of this alone, the silver market has to be incredibly tight.

One commodity that has been close to the bottom of the chart for the last four years is natural gas. It lost 24.9% in 2008, a terrible year for all commodities. But it then went on to lose 0.9% in 2009, and then 21.2% in 2010. It was the only commodity to lose value in both years, during which most commodities soared. Natural gas then went on to lose another 32.2% last year as well. This four-year decline saw natural gas prices fall 63%.

And the pain hasn’t stopped this year. It has dropped from $3.00 to $2.33 this month alone. The natural gas price is now at a 10-year low.

Click here to enlarge

What is going on? Since its peak in 2008, the price has fallen over 80%.

The gas industry has been revolutionised by ‘fracking’ (fracturing) technology that allows gas-bearing rocks to be opened up, so drillers can extract more gas from them. Thanks to fracking, the US now has more gas than it needs. The market is flooded with gas, which has sent the price down. What is most remarkable is that the United States is switching from being a gas importer, to a gas exporter.

Compare the gas chart to the oil chart over the same period. It’s a different story. Oil has had a strong recovery since the market collapsed in 2008. Oil was one of the few commodities to make a gain last year.

Click here to enlarge

I think the oil market has started a new era of higher prices. What is happening around Iran right now is just part of it. What I think is more important, long term, is that the world’s biggest oil exporter, Saudi Arabia has recently set a new fair price of $100 per barrel of oil.

This is as good as saying ‘the oil price is never going under $100 again’. This means oil producers are now looking at a certain future of three-figure oil prices. This is important for oil stock investors because it removes a great deal of risk from oil stocks. This will translate into higher share prices.

But on top of that, the oil market is tighter than ever. If oil exports cease in one part of the world, there is almost nothing in reserve from other exporters. Everyone is going full tilt. For example, Libya produces just 1.6% of the world’s oil. But after it stopped exporting during last year’s civil war, the oil price increased 20%.

The other problem is that many of the major oil exporters are in increasingly unstable countries. Oil importing nations like ours are at the mercy of the stability and cooperation of countries like Nigeria and Kazakhstan. Both export enough oil to have just as big an effect, if not bigger, on the oil price as events in Libya. And the oil industries of both countries have come closer to shutting down in the last month than we realise.

Iran’s threats to block the world’s busiest oil shipping channel could cause a big short-term spike in price. But I think we also have the makings of higher prices well beyond that. There is a $100 floor to the oil price to stop it falling far. Sending it higher will be the unreliable supply from exporters; right at a time that there is no slack in the system.

Oil’s fundamental set up is very bullish, and oil stocks stand to do very well this year. After waiting for this opportunity, I’ll be tipping a few oil stocks in Diggers and Drillers in the next few months.

When we come to review 2012′s commodity performances this time next year, I’m confident oil will be near the top of the list. Along with gold and silver of course!

Dr. Alex Cowie
Editor, Diggers & Drillers

Related Articles

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From the Archives…

Are ASX Energy Index Stocks Worth The Risk?
2012-01-20 – Aaron Tyrrell

Why the World Bank Wants Your Money
2012-01-19 – Kris Sayce

Could $50 Billion In Unpaid Credit Card Debt Drag Aussie Bank Stocks To A Record Low?
2012-01-18 – Aaron Tyrrell

The US-China Power Struggle… and What it Could Mean For Oil and Australian Energy Stocks
2012-01-17 – Dr. Alex Cowie

How Global Oil Supplies Could Fall 40% Overnight
2012-01-16 – Dr. Alex Cowie

Will These Commodities Help You Claim The Best Investment Gains Of 2012?

Within the developed markets, the index had crept up through the past year, only to reverse recently as banks have opted to pre-empt adverse economic effects from the Eurozone debt crisis. The Developed market index was 228 basis points at the end of December 2011.

The frontier market index showed the most significant rise, ending at 968 basis points in Dec 11 (715 bps in Dec 10), driven by a series of significant interest rate increases with frontier markets, many of which faced a larger inflation problem due to the sensitivity of general inflation in those countries to food price inflation.

The Developed market index is likely to contract further this year as the impact of slowing growth and the downside risk presented by the sovereign debt crisis weigh on the economic growth outlook and relieve pressure on inflation.

The most significant risk to that projection is greater diversity in the economic growth and inflation path among countries; with greater diversity/lower economic correlation naturally leading to wider variance in interest rate paths and levels.

Methodology: The Central Bank News Carry Trade Index is calculated by taking the simple average of the top-half (ranked) of central bank interest rates in a group, minus the simple average of the bottom-half in that group, and multiplied by 10,000 to be expressed in basis points (also called ‘pips’ by forex traders).

The groups are loosely based on, but not precisely replicating, the MSCI developed and emerging market index country members, with the remainder of countries falling into the frontier (or lesser developed) countries index. The DM+EM index combines emerging and developed markets, because the countries composing that index are more practical to trade/invest in compared to frontier markets; thus the index gives an indication of what sort of opportunities carry traders might, on average, have available.

Carry Trade Explained: A carry trade is any type of trade or investment which seeks to take advantage of a difference in interest rates or yields. The basic premise is to borrow or short an instrument with a low interest rate, while simultaneously investing or going long in an instrument with a higher interest rate. The existence of a difference in interest rates is termed a ‘differential’.

As market interest rates tend to follow central bank interest rates, central bank monetary policy interest rates serve as a reasonable proxy for gauging the interest rate differentials between countries. The most common carry trade is that engaged in by foreign exchange traders; who swap sums of money between currencies (borrow in the low interest rate currency and invest in the high interest rate currency).

The risks of the carry trade include interest rate risk (changes in interest rates), and market risk (changes in e.g. the exchange rate). A currency carry trade may end up making significant losses in spite of the positive carry due to a significant adverse movement in the exchange rate. Thus the carry trade, while profitable for some, can be a highly risky trade.

www.CentralBankNews.info

BlackRock (NYSE:BLK) reported Q4 operating EPS of $3.06, topping consensus estimates of $2.98.Revenues in the quarter came in at $2.23 billion, slightly lower than estimates for $2.24 billion.Operating margin slipped 0.7% year-over-year to 40.0%.Blackstone (NYSE:BX) has potential upside of 11.7% based on a current price of $15.45 and an average consensus analyst price target of $17.25.

Morgan Stanley (NYSE:MS) reported a narrower than expected loss of $0.15, vs. consensus estimates for a loss of $0.57.Revenues in the quarter came in at $5.7 billion, vs. consensus estimates of $5.57 billion.Morgan Stanley (NYSE:MS) has potential upside of 32.2% based on a current price of $17.35 and an average consensus analyst price target of $22.93.