Market Brief
The Dollar lost its bullish momentum as U.S. stocks advanced yesterday, led by energy and health-care shares, helping the market to erase early loses triggered by China shares with Shanghai Index falling by 4%. The Standard & Poor’s 500 and Dow Jones indices both gained 0.7% to close at 996.46 and 9,279.16 respectively. NYMEX crude oil rallied yesterday to close above $ 72 after a report from the U.S. showing inventories declined the most in 15 months as imports tumbled and refineries increased operating rates.
Cable fell yesterday after the release of BoE minutes, which showed 3 members of the committee wanted to increase the asset purchase program by more than £50 B and on the head of the members was governor Mervyn King who wanted a £75 B expansion. The pound lost more than 150 pips on the release of the minutes, but then pared losses as U.S. rose and risk appetite increased, while the Euro advanced more than 100 pips to close at 1.4234.
Despite consumer prices falling slightly more than expected in Canada, the Canadian & Australian Dollar rallied against the greenback as commodity prices climbed. PIMCO the world’s biggest manager of bond funds, said yesterday that dollar will weaken as U.S. pumps massive amounts of money into the economy, and the greenback is losing its as the world’s reserve currency.
In Japan, BoJ board member Mizuno took a wary note on the Japanese economy, stating that he was unsure if the current recovery would continue. He also stated that the BoJ has limited options left to help support the economy and expected that out put and exports could potentially slow in the second half of the year. In regards to the global economy, he commented that the recovery was fragile and dependant on the massive fiscal and monetarily stimulus provided by governments and policy makers.
Upcoming releases for today, we have the trade balance from Switzerland, retails sales and money supply data from UK. From Canada Wholesales from the month of June will be released, and US will post its weekly jobless claims, the Philadelphia fed index and natural gas storage.
| Global Indexes | Current Level | % Change |
| Nikkei 225 Index | 10,383.41 | 1.78 |
| Hang Seng Index | 20,364.19 | 2.05 |
| Shanghai Index | 2,911.58 | 4.5 |
| FTSE 100 Index | 4,733.99 | 0.94 |
| DAX Index | 5,294.48 | 1.19 |
| SMI Index | 6,032.25 | 0.86 |
| DJIA futures | 9,318.00 | 0.45 |
| World Markets | Current Level | % Change |
| Gold | 943.9 | 0.19 |
| Silver | 13.97 | 0.97 |
| VIX | 26.26 | 0.3 |
| Crude wti | 72.7 | 0.38 |
| USD Index | 78.56 | 0.1 |
| Todays Calender | Estimates | Previous | Country / GMT |
| Retail sales, % m/m (y/y) Jul | 0.4 (2.8) | 1.2 (2.9) | GBP / 08.30 |
| PSNB, £bn Jul | -0.3 | 13 | GBP / 08.30 |
| PSNCR, £bn Jul | -- | 19 | GBP / 08.30 |
| BoE provisional M4 growth % m/m (y/y) Jul | -- | -0.2 (13.8 | GBP / 08.30 |
| Initial jobless claims, thous (4wk mvg avg) 15-Aug | 553 (564) | 558 (565) | USD / 12.30 |
| Leading indicators, % m/m (y/y) Jul | 0.6 (0.1) | 0.7 (-1.2) | USD / 12.30 |
| Philadelphia Fed manufacturing index Aug | -3.5 | -7.5 | USD / 12.30 |
Currency Tech
AUDUSD
R 2: 0.8520
R 1: 0.8478
CURRENT: 0.8308
S 1: 0.8125
S 2: 0.7925
USDCAD
R 2: 1.1347
R 1: 1.1225
CURRENT: 1.0959
S 1: 1.0790
S 2: 1.0630
EURJPY
R 2: 137.85
R 1: 135.10
CURRENT: 134.135
S 1: 132.15
S 2: 131.60
USDMXN
R 2: 13.145
R 1: 13.075
CURRENT: 12.875
S 1: 12.790
S 2: 12.620
- S: Strong, M: Minor, T: Trendline, K: Keylevel, P: Pivot
