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Daily Market News Digest

Discussion in 'Forex News' started by andy003, Jan 21, 2009.

  1. andy003

    andy003 Master Trader

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    Asian stocks declined for a second day, led by financial companies and metals producers, on concern mounting bank losses worldwide will deepen the global recession and squeeze demand for the region’s commodities.The following is excerpts from forex site Bloomberg.com.

    HSBC Holdings Plc, Europe’s largest bank, lost 3.7 percent in Hong Kong amid speculation banks globally need to bolster capital. BHP Billiton Ltd., the world’s biggest mining company, fell 2.1 percent after saying it will take a charge after closing a nickel mine. DBS Group Holdings Ltd., Singapore’s No. 1 lender, led the city’s equities lower after the government cut its economic forecast for the second time in three weeks.
    It’s uncertain how big loan losses at the banks will be as the economy continues to deteriorate. The average valuation of companies on the measure has fallen about two-fifths in the past year to 10 times reported profit. Financial stocks led U.S. equities lower yesterday as Barack Obama was sworn in as president. The Dow Jones Industrial Average declined 4 percent, its biggest Inauguration Day decline. The concern is that banks around the world are short of capital said one analyst.

    Australian Prime Minister Kevin Rudd said yesterday his government will take “whatever action is necessary” to stabilize financial markets. French President Nicolas Sarkozy also agreed to provide more funds to the country’s biggest lenders; a day after the U.K announced its second financial rescue plan in three months.
     
  2. FXexpert

    FXexpert Master Trader

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    Thanks for this news, asian stocks will most likely continue to decline over the next few weeks.
     
  3. andy003

    andy003 Master Trader

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    Emerging countries currencies can continue to lose on risk:

    Emerging-market currencies will extend losses in the first quarter as investors’ appetite for risk worsens amid the global recession, according to Brown Brothers Harriman & Co. in New York,reported Bloomberg.com.
    “Markets are only now beginning to fully appreciate the heightened risks to the global economic outlook and emerging markets remain vulnerable to class-wide waves of selling,” according to a weekly outlook report from Brown Brothers issued yesterday. “We remain most negative on emerging Europe, Middle East and African currencies due to poor fundamentals and are most constructive on Asian currencies in this environment.”
    Investors should continue to buy dollars on dips against emerging-market currencies, the report said.
    China on the other hand refuted U.S. President Barack Obama’s claims that China is manipulating its currency because economic conditions for the Yuan to gain “don’t exist".
    The global recession has narrowed China’s trade surplus in the past few months and reduced inflows of dollars, cooling demand for the nation’s currency, Hua, chief economist at China Construction Bank Corp and formerly a senior economist at the World Bank, said in a telephone interview. China Construction is the nation’s second-largest lender.
    “Naturally the conditions for the Yuan’s appreciation don’t exist any more,” he said. “The Yuan can’t be strong also because the dollar has much strengthened versus other currencies in the past few months.”
    The new U.S. administration believes China is “manipulating” its currency, Timothy Geithner, Obama’s nominee for Treasury secretary, told lawmakers yesterday. The Yuan’s appreciation halted in July, after the currency gained 21 percent since a dollar peg was scrapped in July 2005.“I was very disappointed and surprised at the remarks,” Hua said. “We are concerned about rising trade protectionism in the U.S.”

    China’s currency fell 0.08 percent to 6.8429 per dollar as of 1:08 p.m. in Shanghai, from 6.8371 yesterday, according to the China Foreign Exchange Trade System.
     
  4. andy003

    andy003 Master Trader

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    Currency update:Yen falls for the second day; Pound on a high

    The yen weakened for a second day against the dollar and the euro as gains in stocks reduced demand for the currency as a haven from the financial crisis. Japan’s currency also fell against the Australian dollar and the Brazilian real as measures of bond risk declined after Barclays Plc said it doesn’t need to raise further capital because revenue increased last year. The British pound and the euro strengthened as speculation eased that losses will widen at European banks.
    “We’re seeing an improvement in sentiment because it appears Barclays has avoided a crisis,” said Akio Shimizu, chief manager of foreign-exchange trading in Tokyo at Mitsubishi UFJ Trust & Banking Corp., a unit of Japan’s largest publicly listed lender. “People will trim their bets on declines in the euro and the pound. There’s a bias for the yen to weaken.” The yen declined to 89.50 against the dollar as of 1:29 p.m. in Tokyo from 89.10 late yesterday in New York. Japan’s currency fell to 118.46 per euro from 117.51. The euro climbed to $1.3236 from $1.3189.
    Sterling on the other hand touched a one-week high of $1.4080 after Barclays said yesterday it retains more than 17 billion pounds ($23.9 billion) even after it wrote down another 8 billion pounds of bad loans. The currency rose to $1.4059 from $1.3993.

    Britain’s currency plunged to $1.3503 on Jan. 23, the lowest level ever since September 1985, after the government announced a second bank bailout in three months and a further injection of funds into Royal Bank of Scotland Group Plc.The above is news excerpt from Bloomberg.com
     
  5. FXexpert

    FXexpert Master Trader

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    Emerging countries currencies can be very profitable, the Iraqi Dinar is showing future promise.
     
  6. andy003

    andy003 Master Trader

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    Tough time ahead for investors with the FOMC meeting beginning today

    Investors will have a tougher time assessing Federal Reserve policy when officials today replace interest rates with emergency credit programs as their main tool for steering the economy. That means analysts can’t base their predictions for Fed decisions on a simple interest rate benchmark for the first time since the FOMC began releasing policy statements in 1994.The FOMC will release a statement at about 2:15 p.m (GMT) on in Washington at the conclusion of a two-day meeting.

    The FOMC statement in recent years has followed a clear structure: After a decision on the main interest rate came a paragraph on the economy, one on inflation and another one on the policy stance. The release usually ran about 100 words, fitting on a single page.
    Since October, US interest rates have been reduced from 2% to 0.25%. With the FOMC meeting starting on January 28th and Obama finally in office, investors’ attention is turning to policy decisions and the Fed’s response to the crisis.s
    According to Reuters FEDWATCH, there is a 75% chance that interest rates will stay at 0.25% and a 25% chance that the rates will drop to 0% for the first time in USA history!
    In this scenario, the USD is expected, by some analysts, to decline substantially against all other currencies.
    Crude oil inventories will also dominate the calendar on the 28th, as the market will watch how big the slide in demand becomes (all eyes turn to China).
    The combined two events are expected to have a significant impact on price action on Wednesday, and might provide big market movements and excellent profit opportunities
     
  7. andy003

    andy003 Master Trader

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    You're welcome.You can also share related news in this thread.This is news digest for today-Friday 30th January 2009

    World crisis are deepening
    Somber figures from Japan,the US and other parts indicate World crisis are deepening. While Japan sank deeper into recession with industrial output tumbling and inflation slipping to almost zero, key U.S. data later on Friday is also expected to mirror the worsening global financial crisis.Here are compiled news excerpts from Forexpros.com.

    Japanese economy worsening:
    Japan's industrial production fell a record 9.6 percent in December, while annual core inflation slowed to a mere 0.2 percent. Rising unemployment, slowing household spending and no improvement in the industrial outlook added to fears that Japan was flirting with deflation and would post a horror GDP figure in February if exports do not bail it out. Wider Asian stocks were down 1.1 percent, the first daily drop in a week. Those falls followed similar declines on Wall Street after record monthly U.S. unemployment figures.Japanese companies including the Toyota Motor Corp, Sony Corp along with rival Nintendo Co, Ford Motor Co and Eastman Kodak Co, provided daily evidence of how deeply the global crisis was biting, costing governments trillions of dollars and threatening millions of jobs in the company.

    More bad news is expected in the United States on Friday:
    Economists think the U.S. Commerce Department will say gross domestic product, the broadest measure of U.S. economic activity, shrank at an annualized 5.4 percent in the fourth quarter even as the recession in the US is getting hold. As more jobs and company wealth were lost, Obama railed against "shameful" Wall St bonuses paid to executives at a time when taxpayer money was being used to shore up the crumbling financial system. Four U.S. airlines, led by Continental Airlines Inc, also posted losses, while Boeing Co shares fell 5.9 percent after it said it planned 10,000 job cuts

    The picture in Europe is hardly any sunnier:
    German unemployment rose almost twice as much as expected in January, euro zone economic sentiment hit a new low, while hundreds of thousands of French workers staged a nationwide strike demanding more was done to protect jobs and wages.

    Little appetite:
    Australian private sector credit shrank in December for the first time since 1992 as foreign banks cut lending to local companies.
    Reserve Bank of Australia figures showed that total credit fell 0.3 percent in December, well below a forecast 0.5 percent rise, fuelling expectations the RBA would announce another hefty interest rate cut next week. Across the Tasman Sea, the once-favored New Zealand dollar fell to another six-year low after the central bank said interest rates would likely have to be cut further, a day after the benchmark rate was slashed by 150 basis points.
     
  8. andy003

    andy003 Master Trader

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    Japan sees investment opportunities in Asia, US

    Japanese companies see plenty of opportunities to make acquisitions and investments in Asia and in environmental business in the United States, the Japan External Trade Organisation JETRO said on Friday.But the strong yen and credit crunch mean investment into Japan is likely to continue falling, Yasuo Hayashi, chairman and CEO of JETRO, which promotes trade and investment between Japan and the rest of the world, told Reuters.Here's the compiled news excerpt from Forexpros.com.
    Hayashi said India would offer major investment opportunities because the authorities lacked basic infrastructure.

    Japanese companies were also well placed to pick up investment projects in China, especially in the environment sector, he said in an interview.
    "Japanese business is looking very eagerly at business in China and sales to China of environmental equipment," he said.

    Even in the United States there were opportunities, despite the economic crisis, because the new administration of President Barack Obama wanted to invest in the environment sector, an area of expertise for Japanese firms, he said.

    Japanese companies will also look for investment opportunities in Southeast Asia, including plans to construct an industrial corridor linking India and Vietnam, and in commodities-rich countries in Latin America and Africa seeking to develop their resources, he said.
    The long-term approach of Japanese business meant it was well placed to exploit opportunities even when commodities and energy prices were low, he said.

    "For companies that are cash-rich, strong and able, now is a good opportunity," he said.Because many Japanese companies have relatively strong balance sheets after restructuring following Japan's financial crisis, they are well placed to make foreign acquisitions as well as investments, he said."Many find it a good opportunity to purchase good foreign companies which are in trouble at a reasonable price," he said.

    As a result, Japanese foreign direct investment (FDI), which fell 4.7 percent year-on-year in the first 11 months of 2008 to 4.48 trillion yen, could increase this year, he said.
    But FDI into Japan would continue to decline, after falling 13.5 percent in the first 11 month of 2008 to 6.43 trillion yen, reducing the outstanding stock of inward investment in the country.Hayashi said investment to Japan was falling because the financial crisis made it difficult for investors to raise capital and the strength of the yen was also a deterrent.

    The poor state of the Japanese economy, which suffered a record 9.6 percent fall in industrial output in December, also discouraged inward investment, he said.
     
  9. andy003

    andy003 Master Trader

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    Oil hovers near $42 as US crude workers may strike

    Oil futures rose near $42 a barrel on Monday, buoyed by threats of major strikes by refinery workers in the United States and Britain, but the gains were tempered by concerns of sagging global energy deman, reported Reuters.

    "The slew of economic and oil demand data which came out of the U.S. last week was all pretty negative energy demand outlook," said David Moore, a commodity analyst at the Commonwealth Bank of Australia.” But threats of refinery strikes on both sides of the Atlantic are probably giving oil some support", he further added. A report from the U.S. Energy Information Administration on Friday showed U.S. oil demand in November was 305,000 barrels per day less than previously estimated and was down 1.577 million bpd from a year earlier. Data also showed U.S. gross domestic product fell at a 3.8 percent annual rate in the fourth quarter, the biggest drop since the first three months of 1982.


    In Britain, Prime Minister Gordon Brown on Sunday condemned nationwide wildcat strikes over the use of foreign workers, but unions warned more staff may down tools this week. But fears of a deep global recession and a tumble in world energy consumption continue to unsettle investors.OPEC secretary- general, said $70 to $90 a barrel is a “reasonable” oil price to support investment in new production
     
  10. andy003

    andy003 Master Trader

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    Currencies Update for the Day

    Source: Bloomberg
    US dollar
    The dollar edged up against a basket of currencies in cautious trade on Wednesday before jobs data in the United States and interest rates decisions by central banks in Europe. The U.S. currency made up for some of its losses the previous day, when an unexpected rebound in housing data and hopes for fresh stimulative economic packages in the United States sapped investor demand for the dollar as a safe haven.

    AUD & NZD
    Bloomberg reported the Australian and New Zealand dollars rose for a second day as regional stocks gained and government spending worldwide boosted investor appetite for higher-yielding assets. Australia’s currency climbed the most in seven days.

    EURO
    The euro fell toward an eight-week low against the dollar before a report that may show retail sales slid for a seventh month, supporting the case for the European Central Bank to cut interest rates.

    POUND
    The British pound weakened versus the greenback on concern an industry report will show U.K. services shrank at close to the fastest pace in 12 years.
     
  11. andy003

    andy003 Master Trader

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    Oil falls below $41 in Asia, US unemployment data reflect deep recession

    6th February,2009

    Oil prices fell below $41 a barrel on Friday in Asia as soaring U.S. unemployment and bleak corporate results kept investors pessimistic about demand for crude."We’re seeing too much bad news coming out of companies," said an energy analyst with Fuel First Consulting in Sydney. "If companies are still laying off workers, then economic reports are going to be pretty bad going forward.” With millions out of work, investors fear a downward spiral of falling consumer demand and company losses could lead to further job cuts and weakening crude demand reported the Associated Press.

    The Dow Jones industrial average rose 1.3 percent Thursday.

    Investors are also watching for possible further production cuts by the Organization of Petroleum Exporting Countries, which has already promised to reduce output by 4.2 million barrels since September.

    Meanwhile Bloomberg reported Crude oil fell on concern that fuel demand in the U.S., the world’s biggest energy consumer, may decline as a report showed the number of newly jobless climbed to a 26-year high. A release today may show the jobless rate rose to 7.5 percent in January. Oil is poised for a 2 percent drop this week, the smallest weekly change in more than five months. Prices declined 10 percent last week.
     
  12. andy003

    andy003 Master Trader

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    Asian Currencies Climb This Week on Efforts to Revive Economies

    7th February 09

    An Asian currency gauge rose for a second week as policy makers stepped up efforts to revive economies reeling from the global recession, raising speculation overseas investors are returning to emerging markets.

    The Philippine peso capped the biggest weekly advance in a month. India’s rupee had a second week of gains with an advance of 0.3 percent this week to 48.7250 versus the U.S. currency. Malaysia’s ringgit traded at a one-week high as regional stocks rallied. . Malaysia is prepared to take “radical” steps to boost the economy, the government said on Feb. 5, while the Indonesian rupiah rose 0.3 percent to 11,720 today, paring this week’s decline to 2.4 percent. Indonesia a day earlier cut interest rates for a third straight month. The peso climbed 0.5 percent yesterday to 47.202 per dollar, a weekly gain of 0.4 percent Taiwan will offer tax breaks and subsidized loans to lure local investors back from China, which is increasing export tax rebates for textiles. The Bloomberg-JPMorgan Asia Dollar Index, which tracks the region’s 10 most-active currencies excluding the yen, rose 0.4 percent for the week to 105.10. Elsewhere, The Thai baht fell 0.2 percent on the week to 35 per dollar and Vietnam’s dong was little changed at 17,485.
     
  13. ForexTrader

    ForexTrader Master Trader

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    Excellent Job andy thanks very much.

    Something to add here, with 5.2 Million Chinese Graduates this year, unemployment is set to rise.
     
  14. andy003

    andy003 Master Trader

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    FOREX- Yen Rises on Speculation, Dollar Gains highest against Yen, Retreats shortly

    Thank you forex Trader.
    Unemployment is China's worst nightmare.However,in a way, this crisis could work out well for China. It has the potential to assist re balancing its economy away from production to the creation of more jobs in the service sector.

    As of today, February 09,09
    Dollar hits one month high vs yen later retreats

    The yen rose against the dollar on Monday with demand from Japanese exporters lending support after it earlier hit a one-month low. The dollar hit a one-month high against the yen earlier as the Japanese currency carried over its weakness from Friday, when U.S. shares rallied even as data showed that U.S. job losses in January were the deepest in 34 years
    But the dollar later shed its gains against the yen due to selling by Japanese exporters, traders said. The dollar fell 0.3 percent against the yen to 91.73 yen .The dollar earlier rose to 92.42 yen, its highest since early January.Against the yen, Australia’s dollar fell 1.3 percent to 61.23 and New Zealand’s dollar weakened 1.5 percent to 48.24. .Against the yen, the euro was 0.3 percent lower at 118.70 yen, having retreated from a three-week high of 119.99 yen hit on EBS earlier in the day. The pound fell for the first time in five days against the dollar.

    U.S. financial stability plan to be outlined on Tuesday

    In the near term, currencies are seen likely to take their cues from how the stock market reacts to President Barack Obama's financial stability plan, to be outlined by Treasury Secretary Timothy Geithner in a speech on Tuesday. The dollar broke above the triangle pattern against the yen on technical charts late last week, suggesting it has more room to rise.
     
  15. andy003

    andy003 Master Trader

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    US Equities Dive as Risk Aversion Prevails

    11th February,09

    The safe-haven currencies benefited amid heightened risk aversion, with the dollar and yen advancing against the majors.The Dow Jones and S&P 500 were both lower by over 4% and the NASDAQ sliding by nearly 3.5% in the New York afternoon.

    US Treasury Secretary Geithner described buying up to $1 trillion in banks’ toxic assets and up to $1 trillion in purchases of consumer debt – in an effort to free up the credit markets.

    Euro Pressured on Russian Debt Restructure rumor:
    The heightened risk aversion prompted the euro to slide to 1.2812 versus the dollar and 116.68 against the yen. EURUSD remains mired near the 1.29-level, with support seen at 1.2880, followed by 1.2820 and 1.28. Further selling pressure will be tempered at 1.2770, backed by 1.2740 and 1.27. Gains will target interim resistance at 1.2930, followed by 1.2970 and 1.30. Subsequent ceilings are seen at 1.3040, followed by 1.3070 and 1.31.
     
  16. andy003

    andy003 Master Trader

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    Asian Stocks Fall on Doubts U.S. Stimulus Will Revive Growth

    12th February 09

    Asian stocks fell for a fourth day, led by financial and consumer-related companies, on concern U.S. measures to alleviate the financial crisis won’t be enough to revive the world’s largest economy. The U.S. stimulus plans are still lacking in details,” remarked an analyst from China. “It’s still unclear how they are going to bailout the banks. The market had been awaiting the financial bailout plan with high hopes, but what was announced didn’t have much meat on the bone,” said a Tokyo-based strategist in an interview with Bloomberg Television.

    The MSCI Asia Pacific Index fell 1.5 percent to 81.75 at 11:32 a.m. in Tokyo, with about three stocks advancing for each one that declined. The gauge has lost 8.8 percent this year, extending 2008’s record 43 percent, as the credit crisis triggered by the collapse of the U.S. housing market dragged the world’s biggest economies into recession.

    Indian shares started 0.6 percent lower on Thursday following losses in Asian markets on uncertainty about the global economic outlook.Top-listed Reliance Industries and outsourcer Infosys Technologies were the main losers.
     
    Last edited: Feb 12, 2009
  17. andy003

    andy003 Master Trader

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    Congress dispatches Stimulus Package to Obama

    14th February 09

    An economic stimulus package worth $787 billion is headed to President Barack Obama’s desk after Congress passed the plan that Democrats say is critical to helping pull the U.S. economy out of recession. The Senate late yesterday voted 60 to 38 to approve the package of tax cuts and more than a half-trillion dollar in new federal spending marking also the first major legislative victory of Obama's presidency.


    Democrats predict the plan will save or create 3.5 million jobs. Its costliest item is a $400 payroll tax cut for individuals and $800 for couples. Retirees, disabled veterans and others who don’t pay payroll taxes will get a $250 payment. Democrats released the text of the plan late the night before the vote, prompting complaints from Republicans they didn’t have enough time to review the 1000 Page long legislation before voting on it.Republicans argued that the bill contains too much government spending and, because of that, won’t do enough to boost the economy. The New Hampshire Republican senator Judd Gregg, who withdrew this week as Obama’s commerce secretary nominee, voted against the plan saying the “so-called stimulus plan has become sidetracked by misplaced spending and a lack of attention to the true problems facing the nation.”

    The nonpartisan Congressional Budget Office said the stimulus package will cost $787 billion, rather than $789 billion lawmakers estimated earlier this week. The plan will pump $185 billion into the economy this year and $399 billion next year.
     
  18. andy003

    andy003 Master Trader

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    FOREX-Headlines on Monday

    Yen Rises, South Korean Won drops to two month low:
    The yen climbed to 91.65 against the dollar as of 2 p.m. in Tokyo from 91.93 late in New York on Feb. 13. It advanced to 116.92 per euro from 118.37. Japan’s currency gained 1.2 percent to 59.63 versus Australia’s dollar and rose 1.1 percent to 47.50 against New Zealand’s dollar. South Korea’s won shed 11 percent this year, the biggest drop among the 10 most-traded Asian currencies outside Japan, in a two- month low on concern that a deepening global economic slump will discourage investors from buying emerging-market assets.

    Geithner Pressed By G-7 to Push Ahead With Bank Bailout Plan:
    Finance chiefs from the Group of Seven nations joined the chorus of U.S. investors and lawmakers pushing Treasury Secretary Geithner to move faster to fix the banking system. The G-7 repeated its traditional message that “excess volatility” and “disorderly movements” in exchange rates must be avoided.


    White House dampens stimulus expectations:
    President Barack Obama's aides warned Americans on Sunday not to expect instant miracles from the $787 billion economic stimulus bill he will sign this week, but said it would help eventually. "...this economy is going to get worse before it gets better." Obama said. The republicans kept up their criticism on the.bill saying it is incredibly expensive. “It has hundreds of billions of dollars in projects which will not yield in jobs," John McCain was quoted.
     
  19. andy003

    andy003 Master Trader

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    FOREX-Euro falls to 2 month low vs. US dollar,Yen deteriorates

    17th February 09

    Euro Worsens Against Dollar,Yen:
    The euro fell to a 10-week low against the dollar adding to concern financial turmoil in the region is worsening. The euro also weakened against 14 of the 16 major currencies on speculation its recent declines triggered the execution of automatic sell orders.

    Report pushes euro further down:
    The Moody’s research and risk analysis report aided push euro down below 1.27 and accelerated dollar gains across the board.
    Traders said a sudden bout of heavy selling had forced the euro lower, triggering a series of sell orders and sending it down about 1 percent to $1.2665, it’s lowest since early December.

    Japan’s Concern:
    Japan’s Finance Minister’s resignation spurred growing concern over the world’s second-largest economy .The market sentiment currently is to short the dollar and long the yen, so there’s a bias to buy back the U.S. currency and sell Japan’s, with forecast predicting the yen may fall to 93 per dollar today. Japan’s benchmark index Nikkei fell to its lowest as well in more than two months.
     
  20. andy003

    andy003 Master Trader

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    FOREX-Daily Market Digest


    Wednesday, February 18, 2009

    Yen sees gain:
    The yen gained in currency trading for a third day against the euro on speculation European banks will reveal increasing losses due to the financial crisis in the region.
    Yen strengthened versus 13 of the 16 most-active currencies on concern stock declines will spur investors to sell higher-yielding assets they bought with funds from Japan.

    AUD weakens:
    Australia’s currency may slide to as low as 50 U.S. cents as the global recession can drive down commodity prices. The central bank may lower borrowing costs to a record.

    BSE and NSE move upwards:
    Indian shares turned positive after opening 1.1 percent lower on Wednesday as investors hunted for bargains in the battered market that had fallen 6.2 percent in the previous two days. By 10:05 a.m. (0435 GMT), the 30-share BSE index was up 0.38 percent at 9,069.26 points, with 21 components rising. The 50-share NSE index was up 0.47 percent at 2,783.60.

    Current recession one of the worse:
    Alan Greenspan, the former U.S. Federal Reserve Chairman on Tuesday said the current global recession will be the longest and deepest since the 1930s and more government rescue funds will be needed to stabilize the U.S. financial system.
     

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