Stock Markets rally around the world

Last week’s currency trading review

The Dollarmanaged to gain even as risk sentiment improved with the majors givingup some of last weeks large up moves. The Major news that swept themarkets was Treasury Secretary Geithner’s Toxic partnership plan thatled to a 5% rally in Dow Jones. Also helping sentiment was the reboundin housing data with new and existing home both jumping over 5% lastmonth. Of concern late in the week worries about GM and Chrysler’sviability led to a sharp stock pullback. The Euro gaveup some gains from the previous week as the market looks to the ECB andits next move whether it be to cut rates or begin its own QuantitativeEasing program. Helping cement this view was the continued weak IFOBusiness climate remaining low at 82.1. The EUR/USD fell -2.21 %closing at 1.3284, after opening the week at 1.3578. The Japanese Yentook advantage of the increase in investor confidence with crossesfollowing the lead of USD/JPY which once again marched towards the key100 level. The USD/JPY gained 1.96% closing at 97.85 after opening at95.93. The GBP held up relatively well with themarket surprised by the CPI reading above 3% prompting a letter fromthe Bank of England to the Government. Weak data late in the weak hurtPound Sentiment though with retail sales falling -1.9%. The GBP/USDfell -1.01% closing at 1.4317 after opening at 1.4462. The AUDshrugged off the Euro weakness with AUD/JPY buying keeping the pairwell supported as it tested 0.7000. The AUD/USD closed up 1.05% at0.6938 after opening at 0.6866.

The forex trading week preview

In the States; On Wednesday we have ISM Manufacturing is forecast at 36 vs. 35.8 previously. Also released ADP Employment report forecast at -649K vs. -697K. On Thursday, Weekly Jobless Claims are forecast at 650K vs. 652K previously. Factory Orders (Feb) are forecast at 1.2% vs. -1.9% previously. On Friday we have Non Farm Payrolls (Mar) forecast at -660K vs. -651K previously. The Unemployment rate is forecast at to rise to 8.5% vs. 8.1% previously. Finally the ISM non-manufacturing (Mar) is forecast at 42.0 vs. 41.6 previously. We will provide our previews and reviews of these data releases in the daily summary.

In the Eurozone; On Wednesday we have German Retail Sales forecast at 0.2% vs. -0.6% previously along with EU Unemployment forecast at 8,3% vs. 8,2% previously. On Thursday the ECB meet and are forecast to cut from 1.5% to 1.0%. In the UK; On Wednesday PMI Manufacturing is forecast at 35.0 vs. 34.7 previously. On Friday, PMI Services are forecast at 43.5 vs. 43.2 previously. We will provide our previews and reviews of these data releases in the daily summary.

In Japan; On Wednesday Q1 Tankan Survey is forecast at -55 vs. -24 previously. We will provide our previews and reviews of these data releases in the daily summary.