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As Markets SuggestTitle:
Forex-Euro slides ahead of summit; yen tumbles
(Reuters) - The euro fell against the dollar for the first time in three days on Tuesday as investors doubted whether an informal meeting of European leaders this week would yield much progress in tackling the region's debt crisis.
The weakness in Europe's common currency suggested an uncertain outlook despite a fall in Spanish and Italian government bond yields, and some analysts said stretched positioning and oversold signals could lead to a short squeeze and a higher euro.
While there have been hopes that Wednesday's summit may lead to agreement on measures to boost euro zone growth, investors were not confident of a breakthrough given apparent differences in opinion between Germany and France.
French President Francois Hollande is expected to push for a joint euro zone bond, a ...
Title:
U.S. Existing Home Sales Rose as Expected in April While Resale Prices Posted Solid Gains
U.S. Existing Home Sales Rose as Expected in April While Resale Prices Posted Solid Gains
- Existing home sales in the U.S. rose 3.4% from March's downwardly revised pace to 4.62 million annualized units in April, meeting market expectations.
- The median price of existing homes jumped 10.1% on a year-over-year basis and reached the highest level since July 2010.
- Months' supply of unsold homes rose to 6.6 as homes available for sale surged 9.5%.
- Anecdotal reports noted that the unseasonably warm temperatures seen early this year supported the outsized gain in resale activity in the first quarter (existing home sales were up by an annualized 20% on a quarterly basis), suggesting that some retracement of the recent strength may be in the offing. Today's reported increase in ...
Title:
U.S. Existing Home Sales Increase in April
U.S. Existing Home Sales Increase in April
- Existing home sales rose 3.4% in April to 4.62 million units (annualized), slightly ahead of market expectations.
- Sales of single-family homes rose 3.0% to 4.09 million units. Sales of condos/co-ops rose 6.0% to 0.53 million units.
- The median sales price for all homes was $177,400 in April, up from $164,800 in March. Median prices are up 10.1% from year ago levels.
Key Implications
- As expected, home sales in April continued their slow, but steady march upward. More eye-catching was the surge in the national median sales price to a level not seen since July 2010.
- We suspect that home prices will turn a corner by the second half of the year, and indeed this could be the first indication of that. Data from the most recent ...
Title:
Shares up on Europe summit hopes, euro dips
(Reuters) - World shares gained for a second day on Tuesday amid speculation of fresh action by European leaders to tackle the region's debt crisis, even as the euro fell on doubts that much would come of this week's meeting.
A rise in existing home sales to their highest annual rate in nearly two years in April and a decline in foreclosures added to the positive tone in equity markets.
The National Association of Realtors said existing home sales increased 3.4 percent to an annual rate of 4.62 million units, the highest since May 2010. Across the U.S., the median price for a home resale jumped to $177,400 in April, up 10.1 percent from a year earlier.
"The housing market is showing some signs of life and the April number suggests that sales of single-family homes are rising again," ...
Title:
The Endgame of the Greek Crisis
Forex News and Events:
It has taken two-and-a-half years, and nearly USD 300bn of IMF/EU funds for markets to finally weigh in a more probable than not exit of the debt-laden country. Greece’s EMU exit is imminent for the second time in the last six months. Surprisingly though, the trigger for the recent gloomy expectations for Greece was not exclusively of an economic nature but also politics. During May 6 elections, the Greeks expressed their unwillingness to abide by the agreed-upon austerity measures. It wouldn’t have been a very dangerous position had Greece been solvent, but regardless of EU officials’ reassurance of continued help for Greece throughout the process, the country would run out of funds for the next installments due end of June and early July. In addition to markets ...
Title:
EUR/USD Rebound On Profit Taking
Sunrise Market Commentary
- Fixed Income: limited profit taking on core bond markets
- Global core bond markets fell prey to some profit taking in a thin, dull trading session. However, given the strength of equities, bond losses were very limited and occurred at the onset of trading. Today, the eco calendar remains thin and the profit taking might go some further in the run-up to tomorrow's informal EU Summit.
- Currencies EUR/USD rebound on profit taking
- The correction in EUR/USD was prolonged, but the euro gains were modest and mostly technical in nature. The UK inflation report is the eye-catcher of the day as it may influence sterling. However, overall trading might again be thin ahead of tomorrow's euro Summit.
The Sunrise Headlines
- US Equities rose for a second ...
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Exclusive: U.S. lets China bypass Wall Street for Treasury orders
(Reuters) - China can now bypass Wall Street when buying U.S. government debt and go straight to the U.S. Treasury, in what is the Treasury's first-ever direct relationship with a foreign government, according to documents viewed by Reuters.
The relationship means the People's Bank of China buys U.S. debt using a different method than any other central bank in the world.
The other central banks, including the Bank of Japan, which has a large appetite for Treasuries, place orders for U.S. debt with major Wall Street banks designated by the government as primary dealers. Those dealers then bid on their behalf at Treasury auctions.
China, which holds $1.17 trillion in U.S. Treasuries, still buys some Treasuries through primary dealers, but since June 2011, that route hasn't been necessary.
...
Title:
Oil turns upwards, Greece still weighs
(Reuters) - Oil prices rose back towards $108 per barrel on Monday, after last week's falls, supported by tension between Western countries and Iran as talks were resuming this week and further lifted by the possibility of growth stimulus in China.
Fears of a Greek exit from the euro continued to weigh, however.
A summit of the Group of Eight major economies at the weekend failed to deliver any signal Europe would act quickly to address the risk of a chaotic Greek exit from the euro, leaving investors on alert and curb an upturn in oil prices.
"Gains may be short-lived as EU politicians as usual are having a hard time agreeing on anything. However (there is) an interesting week ahead with the European debt crisis posing a risk on the downside and the potential for nuclear talks with ...
Title:
Greek Chaos Continues But Solution Ultimately Found
- While waiting for the Greek election on 17 June we are likely to see continued high uncertainty and continued high stress in the markets. Things are likely to get worse before they get better.
- Amid this uncertainty, Greek citizens are likely to withdraw more money from their banks and this could escalate into a real bank run.
- A major game of chicken has started between the EU on the one hand and Greek politicians on the other.
- The EU is likely to stand firm on its demands for Greece to deliver austerity and give only a few concessions. The rethoric from the left coalition party Syriza is likely to continue to be fiercely against the EU as it is aiming to become the biggest party and get 50 bonus mandates for this.
- We look at three different post-election scenarios. ...
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