Allow The Euro To Bounce

Equities and risky FX bounce after G8 commitment to Greece and China hints of easing Economic Data (JP) JAPAN MAR ALL INDUSTRY ACTIVITY INDEX M/M: -0.3% V -0.1%E (3rd consecutive decline) (NZ) NEW ZEALAND APR NET MIGRATION: -850 V 230 PRIOR (NZ) NEW ZEALAND APR CREDIT CARD SPENDING M/M: 0.2% V 0.4% PRIOR; Y/Y: 3.7% V 5.3% PRIOR (TH) THAILAND Q1 GDP Q/Q: 11.0% V 10.0%E; Y/Y: +0.3% V -0.5%E (UK) UK MAY RIGHTMOVE HOUSE PRICE M/M: 0.0% V 2.9% PRIOR (4-month low); Y/Y: 2.0% V 3.4% PRIOR Markets Snapshot (as of 04:30GMT) Nikkei225 +0.7% S&P/ASX +0.3% Kospi +0.9% Shanghai Composite +0.2% Hang Seng -0.1% Jun S&P Futures +0.5% at 1,297 June gold +0.4% at $1,599/oz June Crude +0.5% at $91.90 Overview/Top Headlines Asian equity markets, commodities, and risk-on FX opened the new week ...

The Weekly Bottom Line : 19/05/2012 HIGHLIGHTS OF THE WEEK United States - Global economic concerns ratcheted up this week. Widespread discussion of a Greek exit continued, Spanish banks faced rating downgrades and periphery sovereign debt yields moved higher. - Financial markets have responded to these global worries with increased risk aversion. The S&P is poised to end the week 3% lower, and 10-year treasuries are yielding just 1.7%. - U.S. economic data has proved somewhat more encouraging, but growth is still struggling to breakout beyond a moderate pace. This has kept the possibility of additional monetary stimulus alive even if the threshold remains quite high. Canada - Recent economic indicators are showing a resurgence of strength in the Canadian economy. Strong ...

Forex News and Events: While the news flow emanating from Europe has slowed, proving a temporary respite from risky assets, the pressure on Greek banks is growing. After market chatter and media reports, the ECB confirmed that some Greek banks had turned to the Bank of Greece for Emergency Liquidity Assistance (ELA) pending recapitalization. The recapitalization that was to be finalized 'soon', and in theory would allow troubled Greek banks to return to normal ECB funding channels. However, with the other story that massive deposits are being withdrawn from Greek banks (€700bn ins May 6th election) circulating, the erosion of core capital means the prospects of these institution quickly returning to ECB seem unlikely. The recent ECB 3 year LTRO operation was an attempt to build a firewall ...

Germany: The Savior Of Europe? Germany: The Savior Of Europe? It's official, the German economy is single handed propping up the Eurozone after its economy grew five times more than forecast in the first quarter. Growth expanded by 0.5% on the quarter, pushing the annual growth rate to 1.2%, which is fairly healthy considering how dire the growth outlook is elsewhere in the currency bloc. We know that some large German companies like BMW had their best ever quarter in the first three months of the year, thus there were signs that Germany could do better than expected. But what is surprising is that even though Italy contracted more than expected at 0.8% in the first quarter, the Eurozone managed to avoid a recession and registered flat growth overall between January and March. Germany ...

The euro gained against the dollar on Thursday, snapping eight straight sessions of declines and bouncing from its recent 3-1/2-month low as stress in Spanish debt markets eased and Greece secured funds to repay its bondholders. The tempering of the dual threats of a Greek insolvency and the country's potential exit from the euro also had the single currency rebounding from a mid-February low against the Japanese yen. Greece averted an imminent funding crisis after the board of the European Financial Stability Facility agreed to release a scheduled payment. The allocation allows the country to meet near-term bond redemptions, helping the euro stabilize after an eight-day sell off. "The EFSF agreement could be viewed as euro-positive, and data in the U.S. and overseas was not negative, ...

The euro rose against the dollar for the first time in nine sessions on Thursday, bouncing from its recent 3-1/2-month low as stress in Spanish debt markets eased slightly and after Greece secured funds to repay its bondholders. The tempering of the threat of a Greek insolvency and the country's possible exit from the euro also had the single currency rebounding from a mid-February low against the Japanese yen. Greece averted an imminent funding crisis after the board of the European Financial Stability Facility agreed to release a scheduled payment. The allocation allows the country to meet near term bond redemptions, helping the euro stabilize after an eight day sell off. "The EFSF agreement could be viewed as euro-positive, and data in the U.S. and overseas was not negative, but ...

Sunrise Market Commentary - Fixed Income: Little support from elections - Global core bonds set new contract highs at the start of the European session after the French and Greek elections. However, the negative sentiment surprisingly didn't push through and many markets bounced off key levels. - Currencies: euro limits the damage after French and Greek elections. - On Monday, the euro opened sharply lower after the election results in Greece and Spain. However, the price moves developed in an orderly way. Even more, the single currency showed remarkable resilience and reversed part of the early losses. The test of the 1.2974 support was rejected. The EUR/GBP 0.8068 support remains under pressure. The Sunrise Headlines - US Equities hovered sideways on Monday, halting a ...

The Weekly Bottom Line HIGHLIGHTS OF THE WEEK United States - U.S. job creation may have weakened in the last few months, but the grounds for sustaining stronger employment growth are more fertile now than have been since the economic recovery began. Europe's labor market, by contrast, is likely to deteriorate further before it gets better. - Europe's (nonfinancial) corporate sector is highly leveraged. As balance sheet adjustments are made, Europe risks further decreases in investment, higher layoffs, and lower economic growth. These effects are compounded by deleveraging in the public sector. - U.S. corporations, by contrast, are more profitable and liquid than they have ever been. At some point some of these funds will be unleashed towards new investment, creating a positive ...

Fundamental Analysis EUR Unemployment in Spain approached a new record of 5.64 million in March while the jobless rate topped 24.4%, reported the national statistics office. Analysts expect the Spain's officials to confirm that the country is falling into recession. Meanwhile, retail sales in the country declined by 3.7% in March on an annual basis. USD US consumer spending surged in March, adding to the previous gains as incomes increased. Household purchases that account about 70% of the US economy surged by 0.3%, following a 0.9% increase in February. Experts projected consumer spending to rise by 0.4%. Meanwhile, incomes eased up 0.4%, indicating the largest increase in the last three months. GBP UK home value accelerated in April, the second straight month, Hometrack Ltd said on ...