Another Successful Bond

Trading in the London Session was choppy with the market unwilling to take any clear direction as we lead up to tomorrow's informal EU summit. The market toyed with the idea of Eurobonds (they like that idea and risk assets may rally tomorrow on any signs they are on the horizon.) Then they focused on the prospect of a showdown between Germany and France, Europe's de facto leaders, which caused a mild sell off. Right now the chances of the latter happening are more likely especially since Merkel is unlikely to be re-elected next year if she agrees to Eurobonds (read Germany guaranteeing the bulk of Europe's debt), which would never fly with German voters. Although the EU President said that everything is on the table for discussion tomorrow, he also said that no concrete measures will be ...

Dukascopy Fundamental Analysis EUR Investors battered European stocks, dumped the bonds of Spain and Italy, and bid the euro down against the dollar Monday after the collapse of weekend coalition talks in Greece edged that country closer to an exit from the euro zone. USD Retail sales in the U.S. rose in April at the slowest pace of the year, showing unseasonably mild weather and pre-Easter shopping may have pulled consumers to stores the prior month. GBP Governor Mervyn King looks set to leave the door open to more support for the struggling economy when he presents the Bank of England's new economic outlook on Wednesday, which is likely to show a tricky mix of lower growth and higher inflation ahead. CHF Swiss stocks lost ground on Monday on concern Greece will exit the Eurozone. ...

www.sunbirdfx.com Wall Street closed a volatile trading week with declines of 1.0% in weekly summary, in spite of improving consumer sentiment data. The bearish momentum spread among the traders after JP Morgan declared a loss of 2 billion dollars and its downgrade by the ranking agency Fitch. On the technical aspect, the indices made retests to the break-down level in each index' daily chart. The S&P broke the important support at 1360 points but corrected up after reaching 1340 points, and the sellers showed up at 1360 several time during the week. Therefore, if the index successfully breaks-through this resistance, it might jump above 1380 points. However, if the bearish momentum continues, the large blend might break-down the recent low at 1340 point and slide towards 1300 points. ...

FUNDAMENTAL OUTLOOK at 0800 GMT (EDT +0400) WORLD The RBA’s quarterly Statement on Monetary Policy provided further colour on the decision to cut the cash rate by 50 bp on Tuesday. End-2012 forecasts for both core inflation and GDP were modestly downgraded. This came as a minor relief to FX investors, some of whom had feared such a large rate reduction might need substantial forecast downgrades in order to justify it. AUDUSD climbed 20 pips afterwards but eventually gave back all gains. Our analysts team note though that the bank’s assessment of domestic growth now appears to be much less upbeat. They also expect next week’s budget to confirm suspicions that a very significant amount of fiscal drag is in the pipeline over the coming 12 months. Consequently they now expect another 50 bp ...

The dollar has push higher after losing ground last Friday on the back of a successful bond auction in Italy and a weak US GDP report for Q1, with headline US growth slowing to +2.2% annualised rate (exp. +2.5% and prior +3.0%). These soft GDP figures added credibility to Fed Chairman Bernanke's general dovish sentiment, which is fuelling speculation of more easing. Shortly after the weak GDP print both the S&P500 and XAUUSD railed, and USDJPY is looking fairly heavy despite the BOJ announcing yet another round of policy easing on Friday. Nonetheless, most investors in Asia will be waiting for the two big releases of the week in the region which are the RBA's interest rate decision and manufacturing PMI data out of China tomorrow. After the improvement in the unofficial PMI figure the ...

The euro (EUR) rebounded against its major counterparts yesterday supported by surprisingly firm earnings from US companies including Apple which reported almost double quarterly earnings. World equities turned positive as sentiment in the market stabilized. Successful bond auctions in eurozone countries sent the Italian, Spanish and Dutch government bond yields lower. The single currency remains fragile as political uncertainty in the eurozone continues following the resignation of the Dutch prime minister and his cabinet and the first round of the French presidential vote. Versus the dollar, the euro climbed as high as 1.3217 close to a three-week high from 1.3144. The US dollar (USD) weakened against a basket of currencies as an improved risk appetite spurred a lower demand for the ...

The euro received a boost following the most recent German Ifo Business Climate figure to close out last week's trading session. The better than expected news resulted in the EUR/USD shooting up close to 100 pips to finish out the day at 1.3219. Turning to this week, traders can expect market volatility as the US is scheduled to release a batch of potentially significant indicators, including Tuesday's CB Consumer Confidence figure and Wednesday's FOMC Economic Projections. Today, traders will want to pay attention to the German Flash Services and Flash Manufacturing PMI's. Better than expected results could help the euro extend its current trend. Economic News USD - Dollar Drops vs. Main Currency Rivals The dollar reported losses against virtually all of its main currency rivals on ...

(Reuters) - London copper traded slightly above $8,000 a metric tonne on Friday, hovering near its previous close, as investors waited for more decisive cues on demand such as whether China loosens monetary policy and the health of the euro zone. Thursday's successful French and Spanish bond auctions eased some fears over the euro zone debt crisis, but the positive news was later offset by soft jobs data out of the United States. Three-month copper on the London Metal Exchange rose 0.3 percent to $8,070 a metric tonne by 11:56 p.m. EDT, after closing flat on Thursday, but is on track to record a 1 percent weekly rise. The most-active July copper contract on the Shanghai Futures Exchange lifted 0.3 percent to 57,860 yuan ($9,200) a tonne, after falling 0.3 percent in the previous session. ...

Fundamental Analysis EUR France and Spain plan to assemble EUR 13.5 billion (USD 17.6 billion) in bill auction today as Spanish PM Rajoy struggles to reduce budget deficit and presidential elections in the France drive yields up. France is issuing 2017 bills and 2018 inflation linked notes, a maximum target of EUR 11 billion while Spain is planning to raise EUR 2.5 billion in 2-year and 10-year bonds. USD The IMF announced that it has secured 320 billion US Dollars in drive for increasing the fund's lending capacity. Switzerland and Poland have already contributed to the fund expansion. The IMF hopes to raise about 400 billion US Dollars in commitments from countries around the world. The move followed surging borrowing costs of Italy and Spain that escalated concerns over the Euro ...