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Global stocks, euro slip on weakening growth
(Reuters) - U.S. stocks and the euro edged lower on Thursday as data suggested Europe's debt woes were spreading and worsening a global economic slowdown.
In a volatile session, investors looking for bargains earlier bought equities, oil and gold which have been battered this week by worries Greece would leave the euro zone. But the buying of growth-oriented assets faded as worries about the euro zone's drag on the world economy returned.
Stocks and other riskier assets turned negative as disappointing data from Europe, China and the United States compounded concerns about the economic contraction moving across Europe.
Amid speculation of more coordinated efforts from major central banks to stem further deterioration of the euro zone debt crisis, bond yields of Spanish, Italian and ...
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Dukascopy Afternoon Forex Overview : 24/05/2012
Fundamental Analysis
EUR
European stocks returned to growth, despite services and manufacturing purchasing managers indices across Europe and German business confidence shrank more than expected. The Stoxx Europe 600 Index added 1.0 percent to 241.81. Cable & Wireless Communications Plc soared 19 percent. Sonova Holding AG gained 2.5 percent. Bayer AG declined 1.1 percent. U.S. futures and Asian stock little changed. S&P 500 futures gained 0.3 percent, MSCI Asia Pacific index added 0.1 percent.
USD
The US Dollar followed bullish trend on Thursday as Germany disapproves issuance of Eurobonds that may help to ease Greek debt burden. Traders are also cautions ahead of Euro Zone's manufacturing data release due later today. The US Dollar index, which tracks the greenback's performance ...
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Gold rebounds on the dollar’s drop, yet still faces pressure
Gold managed to rebound after the release of softer than expected U.S. durable goods report which pushed the dollar down and gave an advantage to dollar-denominated commodities.
The report showed that durable goods advanced 0.2% in April from a revised of -3.7%.
Accordingly, the U.S. dollar reversed its earlier gains to drop against a basket of major currencies. The dollar index fell to a low of 81.84 after touching a high of 82.36.
Recently, the inverse relation is becoming stronger and mainly the shiny metal’s direction is relying on the dollar’s movements.
However, gold may once again track the losses in the euro which remains under pressure amid worries the debt crisis is intensifying.
Yesterday, the informal EU summit showed disagreement over introducing Eurobonds as German ...
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Weaker euro zone economy sends dollar higher
(Reuters) - The U.S. dollar climbed to a 20-month high and safe-haven German bonds set record low yields, after data showed Europe's economic woes intensifying as business confidence is undercut by talk of a Greek exit and slow progress in tackling the debt crisis.
Private-sector factory activity in China also faltered in May as demand for exports fell, in a worrying sign the impact of the euro zone crisis could be undermining the global economic recovery. Europe is China's largest export market.
But U.S. stock index futures have edged higher as investors remain hopeful that pending data on durable goods orders and initial jobless claims will show the world's largest economy is staying on track for recovery.
The slowdown in economic activity in Europe's powerhouse Germany sent the euro ...
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Markets Ignore Pessimistic Data after China Commits to Boost Growth
After the huge selloff seen through the week, markets returned once again to correct some of the losses incurred supported by the Chinese commitment to support growth and revive the recovery, where investors ignore the heavy load of pessimistic data as Greece still the highlight in markets amid the disappointing informal European Summit yesterday.
Surely, the sentiment is still negative and markets are to resume the bearish wave, but currently markets react to the positive Chinese announcement as the nation pledged to implement more and more measures to boost growth and revive the slowing pace of recovery, noting that China used to lead the pace of recovery worldwide.
Another bullish fact for markets today is the durable goods report from the world`s largest economy, where the critical ...
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U.K. first-quarter GDP downwardly revised to add to worries
U.K. GDP first quarter reading showed worse than expected contraction, adding to concerns the British economy needs more time to recover amid the escalating European debt crisis and weak consumer demand.
The preliminary reading was downwardly revised to 0.3% contraction from both advanced and expected readings of -0.2%, while on the year 0.1% contraction was recorded from both flash and estimated readings of 0.0%.
Details with the release showed that the quarterly drop was triggered by the drop in exports to 0.1% from 1.6% while imports, on the other hand, advanced 0.4% from 0.9%.
In fact, the drop in exports reflect the weak demand from the euro area, U.K.’s main trading partner, and worldwide in addition to the strengthening sterling in the first quarter.
Gross fixed capital ...
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Persistent fears over debt crisis keep the euro near its lowest in 22 months
Investors continue to limit their risk exposure on Thursday, heading towards the safe haven dollar and the Japanese yen, as European leaders failed to adopt concrete actions during yesterday’s summit while manufacturing in China is seen shrinking for a seventh month in May according to HSBC.
With the risk of Greece exiting the euro zone not being eliminated by officials yesterday, the sentiment is seen negative, pushing the euro near the lowest since July 2010, especially after Italian Prime Minister Mario Monti backed French President Francois Hollande’s proposal of jointly underwrite regional bonds that Germany still opposes.
The risk remains subdued and markets trade with volatility today as data may show that Europe’s services and manufacturing industries shrank for a fourth month, ...
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Gold under pressure after EU summit, eyes to track European manufacturing and services
Gold is showing slight decline on Wednesday’s early trading to continue its drop for the third consecutive session on worries from the euro area amid frictions among European leaders over methods to tackle crisis and amid speculations of Greek exit to the euro area.
The main highlight yesterday was the informal EU summit that tackled euro area fiscal problems, where the meeting showed disagreement over introducing Eurobonds as German Chancellor Angela Merkel said after the EU summit that her country support her opposition to jointly issued common European bonds.
On the other hand, still there are many speculations that Greece may leave the euro zone which would lead to many negative consequences on European banks providing loans to Greece.
As long as debt crisis is intensifying, gold is ...
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EUR/USD Falls to 21-Month Low
The EUR/USD fell as low as 1.2614 yesterday, a 21-month low, after investors grew increasingly concerned regarding Greece's fate in the euro-zone and shifted their funds to safe-haven assets. The currency pair staged a mild upward correction later in the day, eventually stabilizing around the 1.2655 level. Turning to today, euro traders will want to pay attention to several potentially significant news events. Specifically, the German Manufacturing PMI and Ifo Business Climate may help the euro recoup some of yesterday's losses if they come in above expectations.
Economic News
USD - Dollar Sees Significant Gains amid Risk Aversion
The US dollar moved up against several of its main currency rivals yesterday, as ongoing fears regarding Greece's future in the euro-zone have led to risk ...
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