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Overnight Briefing

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U.S. equities

Thu, Aug 28 2008, 06:04 GMT
by Jyske Bank Team

Jyske Bank

• Euro rose on ECB comments

• Australian business investment rose

• Dollar slips from six-month high

Today’s main events:

• SEK Retail Sales

• EUR Euro-Zone M3

• USD GDP & Personal Consumption

• USD Initial Jobless Claims & Continuing Claims

American Time Zone:

U.S. equities

U.S. stocks rose for a second day after orders for durable goods unexpectedly advanced in July and analysts said new investments by Fannie Mae and Freddie Mac will boost their earnings.

Alcoa Inc. and Boeing Co. each climbed about 2 % after the Commerce Department report bolstered expectations that the economy is recovering. Fannie Mae and Freddie Mac, the largest U.S. mortgage finance companies rallied more than 11 % each. Crude's advance of more than USD 1 a barrel pushed up 31 of 39 energy producers in the Standard & Poor's 500 Index.

EUR rose on ECB comments

The euro rose from a six-month low to 1.47 versus the dollar as European Central Bank council member Axel Weber said discussion about a reduction in interest rates is premature and crude oil prices increased for a third day.

Oil rose after inventory report

Crude oil futures rose to USD 118.30 after a U.S. government report showed an unexpected decline in inventories.

Far East Time Zone:

Australian business investment rose

Australian business investment surged past all expectations last quarter, led by the booming mining sector, providing muchneeded support to economic growth as households cut back their spending.

Thursday's data also showed firms upgraded already upbeat spending plans for 2008/09, when many analysts had feared the slowing economy would force a pullback.

2nd quarter real private sector capital expenditure +5.7 % q/q, seasonally adjusted (median forecast +2.0 pct).

AUD/USD traded between 0.8576 and 0.8672.

Dollar slips from six-month high

The dollar slipped from a six-month high against the euro on Thursday after comments by a European Central Bank official the previous day scaled back speculation about an ECB rate cut.

ECB Executive Board member Axel Weber, widely considered one of the most influential ECB policy-makers, told Bloomberg News that any talk about lower interest rates in the euro zone was premature.

A rise in oil prices also supported the euro while the dollar remained weighed down by troubles in the U.S. financial system, due to uncertainty over how housing finance firms Fannie Mae and Freddie Mac will be bailed out of the current crisis.

The euro's recovery helped limit yen gains against other currencies and kept the dollar in narrow ranges against the Japanese currency.

Oil price up for 4th day at USD 118

U.S. crude oil futures rose for a fourth straight session to stay above USD 118 a barrel on Thursday, amid concerns Tropical Storm Gustav will intensify into a major hurricane as it moves towards energy facilities in the Gulf of Mexico.

Frontmonth U.S. crude for October delivery was up 20 cents at USD 118.35 a barrel on the Globex electronic trading platform, after settling up USD 1.88 at USD 118.15 on Wednesday.

On Wednesday, the contract touched USD 119.63, the highest since Friday. In the past three sessions, oil has risen USD 3.56.

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Published on  Thu, Aug 28 2008, 06:09 GMT