Posted on 2nd September 2014 by barry norman in Stockpair Daily Insight

stockpair-dailytips (2)

Stockpair traders should keep an eye on these events today:

Event Actual Forecast Previous
  AUD Building Approvals (MoM) 2.5% 1.5% -3.8%
  AUD Current Account -13.7B -14.0B -7.8B
  AUD Interest Rate Decision 2.50% 2.50%
  AUD RBA Rate Statement
  GBP Construction PMI 61.4 62.4
  USD ISM Manufacturing Employment 58.4 58.2
  USD ISM Manufacturing PMI 56.8 57.1

 

The New Month Starts Off Quietly for the Euro & The Yen

September 2, 2014

Barry Norman

European Central Bank President Mario Draghi attends the monthly news conference in FrankfurtThe euro and the Japanese yen started the new month quietly, as US markets were closed for the Labor Day holiday. The euro set a new correction low in the 1.3120 area this morning, but there were no follow‐through losses despite a disappointing EMU manufacturing PMI. Even so, the dollar remains well bid with yen dollar holding easily above 104 despite poor global eco data and ongoing tensions in Ukraine.

Chinese manufacturing PMI’s were reported marginally weaker than expected, suggesting an ongoing sluggish performance in the sector. As traders hopes for stimulus from the PBOC increased. Last week the central bank kicked off a mini stimulus program.  Nevertheless, Chinese/Asian equities eked out moderate gains on hopes for further stimulus. On Tuesday morning there is little activity in the Asian markets with no clues from Wall Street overnight. Ongoing uncertainty on Ukraine and a decent bid for the dollar overall pushed euro lower in the 1.31 big figure, with the pair nearing the key 1.3105 support. The Japanese yen was again hardly affected by the Ukrainian tensions. The pair even regained the 104 barrier.

eurusd

During the European morning trade, the EMU manufacturing PMI was revised slightly lower to 50.7. There was a broad‐based decline among most EMU member countries. Italy and France were even reported in contraction territory. The report supports the case for more ECB stimulus, but the impact on markets was limited. The euro stayed within reach of the correction low but a further decline didn’t occur. The absence of US investors apparently slowed the reaction to the data. USD/JPY remained well bid even as global economic news was disappointing. Tuesday morning saw a climb in Australia building permits while traders await word from Glenn Stevens and the RBA. The Aussie has declined to trade at 0.9292 while the kiwi 31 points to trade at 0.8344. Global sentiment seems to be shifting as the euro took a big tumble this morning to trade at 1.3119 and could break below the all-important 1.31 price. The US dollar seems set to climb over the 83price level for the first time in 2014. There is no Eurozone economic data on the calendar which leaves tensions in the Ukraine as the daily highlight.

us dollar

Posted on 30th August 2014 by barry norman in Stockpair Daily Insight

stockpair-dailytips (2)

Stockpair traders should keep an eye on these events today:

Event Actual Forecast Previous
United States – Labor Day
Canada – Labor Day
  CNY Manufacturing PMI 51.2 51.7
  CNY HSBC Manufacturing PMI 50.3
  EUR German GDP (QoQ) -0.2% -0.2%
  EUR German Manufacturing PMI 52.0 52.0
  GBP Manufacturing PMI 55.0 55.4

 

The Calendar Heats Up With Top Tier Data For CNY & EUR Ahead Of ECB & NFP

September 1, 2014

Barry Norman

Trading in EUR and USD/JPY held in a rather tight range at the end of the week even as there were quite a lot of eco data and as the tensions in Ukraine lingered. The EMU inflation was low (0.3% Y/Y), but in line with expectations.  European yields stabilized and the euro rebounded temporary, too. The yen again didn’t really profit from global uncertainty. USD/JPY is holding near the 104 barrier.

ecb interest rates

Japan dumped their data for the month, Japanese inflation was close to expectations, but spending/activity numbers were rather weak. This is keeping pressure on the BoJ to consider further easing and probably helps to prevent a bigger rise of the yen, even in the current risk‐off context. The downside in USD/JPY proved rather well protected north of 103.50.

EURUSD(60 minutes)20140830100506

The drivers for trading in the European markets were quite similar all week. Traders had to divide attention between Ukraine and the EMU inflation. Early in Europe, European equities tried to regain some ground but at first this didn’t help the euro. EUR tested again the weekly low in the 1.3060 area, but a test of the 1.3053 correction low didn’t occur. The EMU inflation was reported in line with expectation at 0.3% Y/Y. Core inflation was even marginally higher than expected. 0.3%Y/Y inflation of course still fits the definition of too low inflation, but bonds and the euro had already heavily anticipated on additional ECB easing.  Monday will be a very quiet day with US markets closed for the Labor Day holiday and most traders have positioned themselves on the sideline, it is a big data but response will be limited. Early in the session Chinese data will take center stage. Many traders are expecting PMI to miss expectations and send the AUD tumbling. Then we will turn to German GDP and manufacturing data which could send the euro sinking.  Once the new month begins all attention will be drawn to the ECB meeting and decision on Thursday followed by the US nonfarm payroll report on Friday.

infaltion eurozone stockpair

 

Posted on 30th August 2014 by barry norman in Stockpair weekly Insights

Stockpair traders should keep an eye on these events this week:

Time(GMT) Event Actual Forecast Previous
Monday, September 1
All Day   Holiday United States – Labor Day
All Day   Holiday Canada – Labor Day
01:00   CNY Manufacturing PMI   51.2 51.7  
01:45   CNY HSBC Manufacturing PMI     50.3  
06:00   EUR German GDP (QoQ)   -0.2% -0.2%  
07:55   EUR German Manufacturing PMI   52.0 52.0  
08:30   GBP Manufacturing PMI   55.0 55.4  
Tuesday, September 2
04:30   AUD Interest Rate Decision   2.50% 2.50%  
14:00   USD ISM Manufacturing PMI   56.9 57.1  
Wednesday, September 3
01:30   AUD GDP (QoQ)   0.4% 1.1%  
08:30   GBP Services PMI   58.5 59.1  
14:00   CAD Interest Rate Decision   1.00% 1.00%  
Thursday, September 4
01:30   AUD Retail Sales (MoM)   0.4% 0.6%  
11:00   GBP Interest Rate Decision   0.50% 0.50%  
11:45   EUR Interest Rate Decision   0.15% 0.15%  
12:15   USD ADP Nonfarm Employment Change   220K 218K  
14:00   USD ISM Non-Manufacturing PMI   57.6 58.7  
Friday, September 5
12:30   CAD Employment Change   10.0K 41.7K  
12:30   USD Nonfarm Payrolls   220K 209K  
12:30   USD Unemployment Rate   6.1% 6.2%  
14:00   CAD Ivey PMI   55.0 54.1

Global Exchanges

European shares failed to maintain their opening gains to trade lower for a third consecutive session. US Equities trade broadly unchanged ahead of the long weekend in the US. The Dow Jones Industrial Average rose 18 points, or 0.1 per cent, to 17077, after wavering between modest gains and losses. The blue-chip benchmark rose 3.2 per cent on the month and booked its fourth-straight weekly gain. The CAC 40 in Paris finished on Friday 0.75 per cent higher at 4,123.89 points — setting a new year high for the third time this week — while London’s FTSE 100 index of leading shares rose 0.26 per cent to end at 6,499.99 points and Frankfurt’s DAX 30 won 0.19 per cent to close at 8,391.94 points.

The S&P 500 added seven points, or 0.3 per cent, to close at 2003, another record for the index. The Nasdaq Composite Index rose 23 points, or 0.5 per cent, to 4580.

Stocks have benefited from better-than-expected corporate earnings, improvement in much of the US economy, and investors’ distaste for low-return prospects in other assets such as bonds. That positive backdrop has helped stocks to grind higher on a slow week ahead of Monday’s Labor Day holiday in the US, for which stock trading will be closed.

markets stockpair

Currency Markets

In foreign exchange trading, the euro slipped to $US1.3320 from $US1.3346 late in New York on Thursday. The dollar rose to 97.61 yen from 97.36 yen. Sterling steadied against the dollar and euro after rallying to multi-week highs on Thursday as traders increasingly bet on an earlier-than-expected rise to the Bank of England’s main interest rate. Sterling stabilized to 85.28 pence to the euro, having reached 85.05 pence on Thursday, the highest level for six weeks. It had also reached $US1.5652, the highest for two months, and was trading at $US1.5621 on Friday.

global currency stockpair

Commodity Markets

Oil prices have risen as solid data lifted prospects for demand in the United States and tensions escalated between Ukraine and major energy producer Russia. West Texas pushed higher for the fourth straight day, adding 1.41 to $95.96. Brent North Sea added 73 cents to settle at $US103.19 a barrel in London trade. Despite the gains, oil prices finished lower for the month, with the WTI losing 2.3 per cent and Brent down 2.7 per cent.

A series of mostly encouraging data on the US economy this week appeared to signal more potential demand in the world’s largest oil consumer.

 

Posted on 29th August 2014 by barry norman in Stockpair Daily Insight

stockpair-dailytips (2)

Stockpair traders should keep an eye on these events today:

Event
  NZD Building Consents (MoM)
  JPY Household Spending (MoM)
  JPY National Core CPI (YoY)
  JPY Industrial Production (MoM)
  JPY Retail Sales (YoY)
  NZD ANZ Business Confidence
  EUR German Retail Sales (MoM)
  GBP Nationwide HPI (MoM)
  EUR CPI (YoY)
  EUR Unemployment Rate
  CAD GDP (MoM)
  USD Core PCE Price Index (YoY)
  USD Chicago PMI
  USD Michigan Consumer Sentiment

 

US Data Soars – One More Step Towards Rate Increases

August 29, 2014

Barry Norman

It was a day of surprises, by early morning US time the euro had picked up momentum as rumors surfaced that Mario Draghi was back tracking on last week’s statements at Jackson Hole and there was a possibility that the ECB would not be adding stimulus programs at next week’s meeting.  As the day progressed the euro climbed to the 1.323 range and was holding momentum until US data began to hit the wires. The first release was US GDP which shocked analysts reporting above expectations but also at the highest level in years. Expectations were for 3.9% growth but the print was 4.2% turning the US dollar stronger. Next up was weekly jobless claims which reported less claims than expected giving some indication that the NFP next week would show a strong growth in new jobs and a drop in unemployment. This will be the last piece of data that the FOMC will need to start talking about rate increases. Next came US pending home sales, which soared to 3.3% against forecast for 0.5% which helped offset soft new home sales last week. The US dollar added 8 points to trade at 82.55 and the euro eased to 1.315 down by 17 points. As we move to the last day of the month, traders will see a pretty full calendar including that monthly data dump from Japan and then the all-important eurozone inflation. On Thursday, European investors kept a close eye at the EMU data, and in particular at the German inflation data. However, the German inflation was in line with expectation and didn’t strengthen the case for an immediate start of ABS QE. German labour market data and EC confidence data were weaker than expected, but had not big impact on trading. The US dollar continued to rally on Friday morning.

US GDP stockpair

The crisis in Ukraine returned to bite the markets again on Thursday, as President Poroshenko cancelled a visit to Turkey citing “Russian troop deployments” in the east of the country. It is hard to judge whether this is a truly new development, given the evidence of Russia’s military involvement that had already accumulated over many weeks. However, pro-Russia separatists have now taken control of the coastal town of Novoazovsk and are reportedly ready to move on the strategic port city of Mariupol. It is quite plausible (based on what happened in Crimea) that Russia might want to take advantage of these advances and annex more territory from Ukraine, or at least to strengthen its support for the rebels.

us dollar stockpair

Posted on 27th August 2014 by barry norman in Stockpair Daily Insight

stockpair-dailytips (2)

Stockpair traders should keep an eye on these events today:

Event
  AUD HIA New Home Sales (MoM)
  EUR German Unemployment Change
  EUR German Unemployment Rate
  EUR German CPI (MoM)
  CAD Current Account
  USD GDP (QoQ)
  USD GDP Price Index (QoQ)
  USD Initial Jobless Claims
  USD Pending Home Sales (MoM)

 

 

Euro Gets Caught In A Short Squeeze

August 28, 2014

Barry Norman

 

As the month winds down markets will move from a light economics calendar to a busy one and then focus on September with the ECB meet and the nonfarm payroll report taking center stage. In Europe and in the US, there were very few eco data to guide EUR/USD trading. German consumer confidence and French confidence indicators came out on the weaker side of consensus, but with no noticeable reaction in EUR/USD. The euro was even captured by a very limited short squeeze going into the open of the European markets. The pair filled offers just below 1.3190.

However, the move stalled soon and EUR/USD settled in the 1.3175/85 area. Other European markets basically continued to walk the same road as they did of late: playing the QE game. Bond yields set another step south and equities maintained the recent gains. Bond yield differentials between the US and Europe widened further, especially at the long end of the curve. As was often the case, this didn’t help the dollar much as the focus of currency markets is mostly at the short end of the curve. The ongoing decline in core bond yields (in the first place in Europe, but also in the US) also weighs on USD/JPY. The recent rally is over for now and the pair struggles to hold above yesterday’s low in the 103.75 area.

EURUSD(60 minutes)20140827114624

The UK calendar was bare on Wednesday also. Yesterday, we already indicated that sterling performed rather well against the euro and the dollar and that the correction of sterling was losing momentum, even against the dollar. This pattern was confirmed today. In technical trade EUR/GBP drifted below the 0.7950 mark and cable retested the 1.66 barrier. So, it looks that the downside in sterling is becoming better protected. From here, we look out whether this GBP bottoming out process will be confirmed by UK eco data further down the road. Keep an eye on Thursday’s releases with the CBI distributive trades first out of the gate. The US session should be very active and volatile.

EURGBP(60 minutes)20140827114643

Posted on 26th August 2014 by barry norman in Stockpair Daily Insight

stockpair-dailytips (2)

Stockpair traders should keep an eye on these events today:

AUD                Construction Work Done

EUR                GfK German Consumer Climate

 

Consumer Confidence Soars To 2007 High Along With A Jump In Core Durable Goods

August 27, 2014

Barry Norman

US consumer confidence soared to a record high yesterday followed by an odd mix for core durable goods and durable goods. New orders for manufactured durable goods jumped 22.6 percent in July of 2014 boosted by higher demand for non-defense aircraft. It is the highest growth rate on record and follows a revised 2.7 percent increase in June.  New orders for manufactured durable goods in July increased $55.3 billion to $300.1 billion.  Leaving out the transport sector, durable goods orders fell 0.8% in the month, dragged down by a slowdown in orders for electrical equipment, appliances, and components, and by defense industry goods. Durable goods should not be mixed up with retail sales, durable goods are products that will last a minimum of three years and the durable goods report is based on orders not completed purchased items. Things like aircraft will not be deliverer for close to 10 years and will not hit the GDP until they are completed.

us durable goods

All the while US consumer confidence surged to touch its 2007 high before the financial crisis. The U.S. consumer confidence index jumped to 92.4 in August, the highest level since October 2007, from a revised 90.3 in July, the Conference Board said Tuesday. Economists polled by MarketWatch had expected the index to pull back to 88.5 from an originally reported 90.9 in July. The present situation index, a measure of current conditions, rose to 94.6 from 87.9. The future expectations index declined to 90.9 from 91.9. Confidence has now increased for four straight months, and consumers remain quite positive about the short-term outlooks for the economy and labor market.

us dollar stockpairStrong hiring this year has provided more Americans with paychecks and boosted confidence in the overall economy. Lower gasoline prices have also probably helped. The average price of a gallon of gas nationwide Monday was $3.44, the lowest in nearly six months, according to AAA.

In July, consumers expected the job market to keep improving: Those anticipating more jobs in the months ahead increased to 19.1 percent, up from 16.3 percent in June. And 15.9 percent said that jobs were plentiful, up from 14.6 percent the previous month.  Employers have added an average of 230,000 jobs a month this year, up from about 195,000 a month in 2013. Average monthly job gains in the six months since February have been the best since 2006.

The unemployment rate ticked up to 6.2 percent in July from 6.1 percent in June. But that was because more Americans began looking for work. While most didn’t immediately find jobs, the increase suggests they are more confident about their prospects.

This puts next week’s Nonfarm Payroll report back in the spotlight.

Posted on 26th August 2014 by barry norman in Stockpair Daily Insight

stockpair-dailytips (2)

Stockpair traders should keep an eye on these events today:

Event Forecast Previous
  NZD Trade Balance (MoM) -475M 247M  
  GBP BBA Mortgage Approvals 44.2K 43.3K  
  USD Durable Goods Orders (MoM) 7.5% 1.7%  
  USD S&P/CS HPI Composite – 20 8.4% 9.3%  
  USD CB Consumer Confidence 89.0 90.9

German Ifo Data Drags The Euro Below 1.32

August 26, 2014

Barry Norman

This week US data will continue to take center stage as the US dollar rallies and the euro tumbles. The dollar has gained steadily for the last two weeks and is trading at 82.59. On Monday new homes sales were disappointing missing expectations as markets were hoping that following a surge in existing home sales, building permits and all other indications that new home sales would have followed the markets. Analysts have made allowances for the miss, as there were strong upward revisions to the previous months and the surge in existing home sales might indicate that buyers were more eager to move into new residences instead of waiting for new homes to be constructed.  Existing home sales close faster than new home sales and with the possibility of interest rate increases in the near term, buyers are looking to lock in low mortgage rates quickly. None the less the dollar was little phased. Today traders will look at the all-important US durable good sales.

us dollar

The US dollar has been beating up on the euro ever since Mr. Draghi’s presentation last week at Jackson Hole but yesterday’s disappointing German data really weighed on the euro. The euro closed below the 1.32 level and has added 13 points in the Asian session after as traders bought up the cheap currency. The Ifo Business Climate Index survey is based on the responses of about 7,000 companies in manufacturing, construction, wholesaling and retailing. The headline Ifo Business Climate component came out at 106.3

Divergence between the US Fed and ECB interest rate outlooks has been the main driver behind the move that has seen the euro fall 6 per cent since early May. The wedge between the two is only getting wider, with comments from both US Federal Reserve Bank chair Janet Yellen and European Central Bank president Mario Draghi dragging the euro lower over the weekend.

eurusd stockpair

Posted on 23rd August 2014 by barry norman in Stockpair Daily Insight

stockpair-dailytips (2)

Stockpair traders should keep an eye on these events today:

Event   Forecast Previous
  Holiday United Kingdom – Summer Bank Holiday
  EUR German Ifo Business Climate Index   107.0 108.0  
  USD New Home Sales   430K 406K

 

What’s Up For The USD What’s Up This Week For The USD?

 August 25, 2014

Barry Norman

The USD put in a strong performance last week with the Index touching multi-month higher near the 82.35 mark as a comparative performance of the USD against basket of 6 major currencies globally. Markets had some important readings for housing and manufacturing this past week while markets also took cues from the US FED’s minutes of the July month monetary policy.  This week will start with the New Home Sales reading hoping the reading is probably likely to take some guidance from the stronger housing starts and existing home sales reading for July, both of which surpassed markets estimates. Traders’ hopes for a positive reading also count on the fact that in June, New Home Sales contracted by over 8% so some pent-up buying might also support well. Other than this, the same day traders also track the Chicago Fed Nat Activity Index and the Markit US Composite PMI wherein both are seen improving.

us dollar

The hand overturns calendar sheet isolated on white backgroundThere are host of data points to be watched from the US next week, on Tuesday the Durable Goods Orders is seen to be the key. The reading is also seen popping eyes as US orders are expected to rise by around 7.5% boosted by some heavy bookings for transportation and aircraft segments. However, core Durable Goods is expected to add marginally in the month of July. The same day we have the S&P-CaseShiller Home prices data wherein prices increase is expected to continue slowdown in  major cities whereas separate reading might show Consumer Confidence Index remained steady to higher in the world’s largest economy.

Wednesday is mostly seen dull while markets await the critical revised Q2 GDP reading. As per early estimates, economy is most likely to hold near the 4% growth mark, as reported in the initial estimates earlier. The same day later we have the Pending Home Sales reading which is expected to improve as also been the case in the other lagging housing indicator the, existing home sales which came strong this week. Lastly on the last day of the week, Personal Income/ Spending, Chicago PMI and the Univ. of Michigan Confidence all too are expected to see continued improvement.

Posted on 23rd August 2014 by barry norman in Stockpair weekly Insights

Stockpair traders should keep an eye on these events this week:

Event
  EUR German Ifo Business Climate Index
  USD New Home Sales
  USD Core Durable Goods Orders (MoM)
  USD CB Consumer Confidence
  USD GDP (QoQ)
  USD Pending Home Sales (MoM)
  EUR CPI (YoY)
  CAD GDP (MoM)

 

Global Exchanges

Wall Street closed narrowly mixed Friday despite an initial climb following Fed chief Janet Yellen’s speech in Jackson Hole, Wyo. The NASDAQ closed with a 0.1% gain, while the S&P 500 and Dow industrials each shed 0.2%. All three indexes were on track for a 2% weekly gain. Volume eased across the board vs. Thursday, according to preliminary data.

Global markets this week have continued with their appreciating trend from the previous week. The US equity indices have led the rally with the S&P 500 index opening at 1992 on Friday. The positive exuberance emanating out of the US equity markets have cascaded into a positive driving force for most of the equity markets across the globe, except for the European markets, which seem to have been reeling under disappointing economic data for the last few weeks. Asian markets have appreciated this week, with the benchmark index making a new high and closing above 7900 this week.

global markets stockpair

Currency Markets

There have been many major economic data points that have been released this week , the major events that can be listed out are the FOMC minutes release, wherein some members of the FED committee were in favor of an accelerated rate hike if the jobs situation continued getting better at the current rate and, among other important releases, EU and UK regions have come out with disappointing economic data with starting with the British CPI came in lower at 1.6%, and the retail sales too came in lower at 2.6% against a market expectation of 3.0%. From the Euro area, the disappointment seems to have continued this week as well. The European and German manufacturing and services PMI came in lower than expected and resulted in the Euro and Pound depreciate further from last week’s lows. The dollar index has ended at 82.23 against last week’s closing of 81.57

global currency stockpair

 

Commodity Markets

Gold prices are set to drop further next week as improving economic data from the US, and hints from the American central bank about a likely interest rate hike next year, are expected to dent the precious metal’s safe-haven status. As many as 12 of 23 analysts polled in a Kitco Gold Survey said they expected gold prices to trade lower next week, while eight predicted that prices will rise and three forecast prices to trade sideways. Gold finished $4.80 lower at $1,280.20 an ounce on 22 August. Prices are down some 2% for the week as a whole.

Posted on 21st August 2014 by barry norman in Stockpair Daily Insight

stockpair-dailytips (2)

Stockpair traders should keep an eye on these events today:

Event
  CAD Core Retail Sales (MoM)
  CAD CPI (MoM)
  CAD Retail Sales (MoM)
  USD Fed Chair Yellen Speaks
  EUR ECB President Draghi Speaks

 

Gold Continues To Tumble Ahead Of Speeches From Yellen And Draghi

August 22, 2014

Barry Norman

draghi-yellenGold eased as traders reviewed data and minutes from the Fed. The minutes, released late Wednesday, showed that a majority of Fed policymakers believe the U.S. economy is improving enough for the central bank to start raising interest rates sooner than previously thought. The debate on when the Fed should begin increasing rates, which have been near zero since 2008, has intensified in recent months as the Fed winds down its other economic stimulus.

Fed Chair Janet Yellen will give a speech at an annual conference of central bankers and other policymakers in Jackson Hole, Wyoming on Friday. Investors will be watching closely for clues into her thinking on the timing of interest rate hikes.

Trading volumes have been light during the recent run-up in part because many investors are focused on the potential for central bankers to update their views on monetary policy. Federal Reserve Chairwoman Janet Yellen is slated to give a speech Friday in Jackson Hole, Wyo. European Central Bank President Mario Draghi is also due to speak Friday.

The speech from Mr. Draghi could have the greatest impact on the market.

“There is a greater element of surprise” from the ECB,. That is because the “policy arsenal” in Europe is broader, while most expect the Fed to continue to gradually reduce its stimulus efforts and begin to raise interest rates starting next year.

Gold slid around 1% to its lowest in two months on Thursday, extending losses to a fifth session on a firm dollar and after slightly better than expected US jobless claims fed expectations for an early interest rate hike.

gold stockpair

The US Labour Department report showed the number of Americans filing new claims for unemployment benefits fell slightly more than expected last week, pointing to a sustained improvement in labour market conditions.

Higher interest rates would dull the appeal of non-interest-bearing assets such as gold. Gold fell as much as 1.4% to its lowest since June 18 at $1,273.54 an ounce.

eurusd stockpair