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Market Review - 01/11/2007 22:30 GMT
Japanese yen rises broadly due to the selloff in U.S. stocks
The Japanese yen rallied against major currencies on Thursday due to a selloff in U.S. stocks on concerns about credit market losses after ratings cuts on Citigroup Inc. and Bank of America Corp., which increased worries that the subprime mortgage crisis may weaken economic growth.
U.S. stocks tumbled broadly on Thursday with the Dow Jones industrial average and the Standard & Poor's 500 Index falling 2.6%, the most since August 9. Credit Suisse Group announced $1.9 billion of writedowns of fixed-income securities and leveraged loans in the third quarter. Oil fell from a record high of $96.24 a barrel while gold dropped from a 27-year high of 799.30 to 784.70.
The greenback fell sharply against the Japanese yen from 115.93 to 114.47 as investors actively unwound carry trades on the selloff in global stocks markets. The single currency tumbled versus the yen from 167.23 to 164.95. Aussie and sterling also weakened against the Japanese unit from 107.80 to 104.51 and from 241.35 to 238.00 respectively
The British pound rallied to a 26-year high of 2.0875 before retreating in late New York. The Australian dollar and New Zealand dollar fell versus the U.S. currency from 0.9338 to 0.9108 and from 0.7739 to 0.7572 respectively. The greenback rebounded against the Canadian dollar from 0.9423 to 0.9522.
On the data front, the U.S. core PCE rose by 0.2% m/m or 1.8% y/y in September as widely expected. Jobless claims decreased to 327,000 last week from an upwardly-revised 333,000. September personal income and personal spending came in at 0.4% and 0.3% respectively. The ISM manufacturing in October fell to 50.9, much lower than the expectation of 51.8 and the previous month’s reading of 52.0.
Friday will see the release of German and eurozone manufacturing, U.K. PMI construction and Canada’s unemployment rate. U.S. will release the important non-farm payrolls data, unemployment rate, average hourly earnings, factory orders and revised durable goods. Economists expect employers added 84,000 workers to non-farm payrolls last month following an increase of 110,000 in September.
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Market Review - 01/11/2007 22:30 GMT
Japanese yen rises broadly due to the selloff in U.S. stocks
The Japanese yen rallied against major currencies on Thursday due to a selloff in U.S. stocks on concerns about credit market losses after ratings cuts on Citigroup Inc. and Bank of America Corp., which increased worries that the subprime mortgage crisis may weaken economic growth.
U.S. stocks tumbled broadly on Thursday with the Dow Jones industrial average and the Standard & Poor's 500 Index falling 2.6%, the most since August 9. Credit Suisse Group announced $1.9 billion of writedowns of fixed-income securities and leveraged loans in the third quarter. Oil fell from a record high of $96.24 a barrel while gold dropped from a 27-year high of 799.30 to 784.70.
The greenback fell sharply against the Japanese yen from 115.93 to 114.47 as investors actively unwound carry trades on the selloff in global stocks markets. The single currency tumbled versus the yen from 167.23 to 164.95. Aussie and sterling also weakened against the Japanese unit from 107.80 to 104.51 and from 241.35 to 238.00 respectively
The British pound rallied to a 26-year high of 2.0875 before retreating in late New York. The Australian dollar and New Zealand dollar fell versus the U.S. currency from 0.9338 to 0.9108 and from 0.7739 to 0.7572 respectively. The greenback rebounded against the Canadian dollar from 0.9423 to 0.9522.
On the data front, the U.S. core PCE rose by 0.2% m/m or 1.8% y/y in September as widely expected. Jobless claims decreased to 327,000 last week from an upwardly-revised 333,000. September personal income and personal spending came in at 0.4% and 0.3% respectively. The ISM manufacturing in October fell to 50.9, much lower than the expectation of 51.8 and the previous month’s reading of 52.0.
Friday will see the release of German and eurozone manufacturing, U.K. PMI construction and Canada’s unemployment rate. U.S. will release the important non-farm payrolls data, unemployment rate, average hourly earnings, factory orders and revised durable goods. Economists expect employers added 84,000 workers to non-farm payrolls last month following an increase of 110,000 in September.
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