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Market Review - 04/09/2009 20:34 All times in GMT
Dollar and yen fall as risk appetite returns after U.S. payrolls data
Despite initial dollar's broad-based weakness after release of U.S. jobs data as the unemployment rate climbed unexpectedly to 9.7% vs forecast of 9.5%, the highest level since 1983, investors shrugged off this bad number when U.S. stocks prices started to rise. The greenback and yen weakened against most of their major counterparts as investors later turned more hopeful that the global economy will recover and bought higher-yielding assets as market focused on the U.S. payrolls report which showed job losses had slowed. U.S. non-farm payroll data in August reported a loss of 216,000 jobs (better than forecast of –225,000) compared to a revised figure of -276,000 in the previous month.
Earlier, euro advanced to 1.4289 in European morning due to firm stock prices in regional equities, the pair then fell to as low as 1.4191 after the release of U.S. data as the greenback strengthened across the board. However, investors’ optimism on economic recovery gave boost to high-yielding currencies, the single currency later rebounded strongly to an intra-day high of 1.4328 in U.S. afternoon.
Cable fell to as low as 1.6288 in tandem with euro due to dollar’s broad-based firmness after the release of U.S. data, price later staged a strong rebound to 1.6412 (3 ticks below Thursday high at 1.6415) on improved risk-appetite and relatively thin trading volume ahead of the G-20 meeting and U.S. long weekend (Labour Day on Monday).
Against the yen, dollar fell briefly to 92.27 after U.S. employment report, however, the greenback then rallied to as high as 93.26 as traders’ purchase in risky assets diminished the demand for safe-haven currencies. Yen declined broadly against its major counterparts, price weakened against euro, sterling and aussie to as low as 133.25, 152.73 and 79.38 respectively.
DJI rose 96 points to end at 9441 on economic recovery hopes, while S&P 500 and NASDAQ advanced 13 and 35 points respectively to close at 1016 and 2018.
Economic data to be released next week include:
Monday - Factory orders in Germany. Tuesday - BRC retail sales, RICS house prices, industrial production and manufacturing production in U.K.; jobless rate in Switzerland; trade balance, current account, industrial production, import and export figure in Germany; building permits in Canada. Wednesday – Nationwide consumer confidence and Trade balance in U.K.; Westpac consumer confidence and retail sales in Australia; leading indicators and tools orders in Japan; CPI and HICP in Germany and; housing starts in Canada. Thursday – RBNZ September rate decision; domestic CGPI and machine orders in Japan; employment change and unemployment rate in Australia; BOE rate decision; trade balance and Jobless claims in U.S.; trade balance, imports, exports and BOC rate decision in Canada. Friday – GDP and consumer confidence in Japan; WPI in Germany; PPI in U.K.; new housing price in Canada; University of Michigan survey index, wholesales inventories and Fed budget in U.S.
Dollar and yen fall as risk appetite returns after U.S. payrolls data
Despite initial dollar's broad-based weakness after release of U.S. jobs data as the unemployment rate climbed unexpectedly to 9.7% vs forecast of 9.5%, the highest level since 1983, investors shrugged off this bad number when U.S. stocks prices started to rise. The greenback and yen weakened against most of their major counterparts as investors later turned more hopeful that the global economy will recover and bought higher-yielding assets as market focused on the U.S. payrolls report which showed job losses had slowed. U.S. non-farm payroll data in August reported a loss of 216,000 jobs (better than forecast of –225,000) compared to a revised figure of -276,000 in the previous month.
Earlier, euro advanced to 1.4289 in European morning due to firm stock prices in regional equities, the pair then fell to as low as 1.4191 after the release of U.S. data as the greenback strengthened across the board. However, investors’ optimism on economic recovery gave boost to high-yielding currencies, the single currency later rebounded strongly to an intra-day high of 1.4328 in U.S. afternoon.
Cable fell to as low as 1.6288 in tandem with euro due to dollar’s broad-based firmness after the release of U.S. data, price later staged a strong rebound to 1.6412 (3 ticks below Thursday high at 1.6415) on improved risk-appetite and relatively thin trading volume ahead of the G-20 meeting and U.S. long weekend (Labour Day on Monday).
Against the yen, dollar fell briefly to 92.27 after U.S. employment report, however, the greenback then rallied to as high as 93.26 as traders’ purchase in risky assets diminished the demand for safe-haven currencies. Yen declined broadly against its major counterparts, price weakened against euro, sterling and aussie to as low as 133.25, 152.73 and 79.38 respectively.
DJI rose 96 points to end at 9441 on economic recovery hopes, while S&P 500 and NASDAQ advanced 13 and 35 points respectively to close at 1016 and 2018.
Economic data to be released next week include:
Monday - Factory orders in Germany. Tuesday - BRC retail sales, RICS house prices, industrial production and manufacturing production in U.K.; jobless rate in Switzerland; trade balance, current account, industrial production, import and export figure in Germany; building permits in Canada. Wednesday – Nationwide consumer confidence and Trade balance in U.K.; Westpac consumer confidence and retail sales in Australia; leading indicators and tools orders in Japan; CPI and HICP in Germany and; housing starts in Canada. Thursday – RBNZ September rate decision; domestic CGPI and machine orders in Japan; employment change and unemployment rate in Australia; BOE rate decision; trade balance and Jobless claims in U.S.; trade balance, imports, exports and BOC rate decision in Canada. Friday – GDP and consumer confidence in Japan; WPI in Germany; PPI in U.K.; new housing price in Canada; University of Michigan survey index, wholesales inventories and Fed budget in U.S.
