Downbeat Industrial Production

(Reuters) - Copper firmed a little on Thursday after sinking to a 4-1/2 month low in the previous session but remained under pressure as downbeat data from the European Union raised worries that global economic weakness will hit demand for industrial metals. Benchmark copper on the London Metal Exchange was trading at $7,589.50 a tonne by 0939 GMT, 0.8 percent up from a close at $7,531 on Wednesday. The metal, used in power and construction, has dropped on risk aversion triggered by worries about Greece's possible exit from the euro zone. Business surveys showed Germany's manufacturing sector has been shrinking at the fastest rate in three years in May and the euro zone's private sector has sunk further into the doldrums this month as new orders shrivel, forcing firms to run down ...

The week has come to an end and still Greeks cannot find common grounds regarding the creation of the coalition government, where after the effort made by Samaras and Tspiras failed, the focus will shift now to the former finance minister, Evangelos Venizelos, who will be meeting the leaders of other parties in attempt to end the political turmoil seen in Greece, and accordingly ease tension that controlled markets through the week. Eyes turned now to the PASOK Party to create the government, where Venizelos, who dropped his job as a finance chief to lead the party, is expected to negotiate his peers today in attempts to create a government to avoid bankruptcy, as the Greek financial situation is critical now and austerity for sure is the best interest for Greece. The sentiment continued ...

Sunrise Market Commentary - Fixed Income: new contract highs - London-traders returned and the market seemed to react with a lag to this weekend's election results. In a risk off session, both the German Bund Future and the US Note Future set new contract highs, respectively at 142.62 and 133-04. - Currencies EUR/USD testing key support - On Tuesday, sentiment on the euro remained fragile even as there was little news from the political scene in France or Greece. EUR/USD is again testing the key 1.2974/55 support area. A break below this level would be highly significant from a technical point of view. The Sunrise Headlines - US Equities dropped sharply lower yesterday, but reversed most of their losses in the final hours of trading. The S&P ended the session 0.43% lower. ...

The cheery sentiment we have seen within the past two days was dampened by the lower than expected pace of growth in China; the Chinese economy grew at 8.1% rate in the first quarter below market consensus of around 8.4% expansion rate; and down from 8.9% in the fourth quarter of 2011. While retail sales and industrial production showed slight expansion however just around market expectations, and fixed assets investment dropped from 21.8% to 20.9%. The numbers from China has drawn a downbeat start for the session and could continue to dampen investors’ appetite; markets continue to be data sensitive specifically from major global economies, where fears could infiltrate into the trade that China would not escape a hard landing; thus we have not seen the trough of the economic cycle yet. ...

The U.S. dollar continued the upside move for the third consecutive day as more investors are holding the low yielding currency in order to avert as much risk as possible, ahead of the Bank of England rate decision and as borrowing costs in Europe return to incline, with fears unsustainable yields on Spanish and Italian bonds might pressure the nations toward the debt-trap. Borrowing costs on Italian and Spanish bonds continued to force more pressures on both nation, as yields on 10-year Spanish bonds reached the highest since December, adding so far 24 basis points to currently hover around 5.71%. Yields on the Italian 10-year benchmark climbed 11 basis points to 5.4%, adding concerns Spain and Italy are not well-protected and might follow other weak indebted nations, unless lawmakers ...

The Asian region is about to start a calm week, as the eyes will be focused on Japan except for Japan that dominates the week's data. The data starts with February's industrial production along with the CPI and the unemployment figures. Japan’s February preliminary industrial production index is due for release where the prior reading indicated an increase by 1.9%; also February's unemployment data will be released, which is expected to hold at 4.6%. The Japanese economy is currently struggling to recover and to beat its chronic problems, and on top of these problems comes the yen's ongoing appreciation. The currency recently retreated to its lowest level in 11 months to give some room for Japanese companies; however it's not enough especially after the recent contraction in the fourth- ...

With the start of the session today markets rebounded to the upside, correcting some of the huge losses incurred yesterday, supported by eased concerns in regards to the Greek debt-swap deal, where more large financial entities are joining the debt swap campaign in attempts to save Greece from a financial disaster. Eyes are still focused on the Greek debt swap deal with the private sector, where a deal should be reached maximum on Thursday, while some kind of improvement was seen today after Societe Generale, UniCredit and Assicurazioni Generali all agreed to participate in the Greek debt-swap deal, joining several other firms already committed to the campaign that aims at helping Greece to avert a financial collapse. The Greek government expressed that 75% of the total bondholders must ...

Weekly Economic and Financial Commentary : 11/02/2012 U.S. Review The Moderate Economic Recovery is Still Underway Consumer credit surged by $19.3 billion in December, the second consecutive solid monthly increase reflecting growth in credit cards, student loans and car loans. Weekly first-time jobless claims fell by 15k to 358k and the Job Openings and Labor Turnover Survey showed the number of job openings in December rose 2.5 percent. Data on international trade show the nominal U.S. trade deficit widened 3.7 percent to $48.8 billion in December from $47.1 billion in November. Light Week for Data, but the Economy is Still Improving Despite headlines dominated by the Eurozone sovereign debt crisis, the flow of economic releases in the U.S. this week was fairly light and ...

The sentiment is mixed in the market today as investors are still waiting the results of the Greek debt-talks with creditors, which lasted for a long period of time, where Greece remains in focus as the nation's future should determine the economic situation in the euro-area region in 2012. Greece returned to be the main focus in the market, where all eyes are still tracking any developments in the Greek debt talks with the private sector over the coupon rate paid on the new bonds to be issued instead of the current Greek debt held by the private sector, where Greece is pressured now by the International Monetary Fund, the European Union and the European Central Bank, as the nation must reach an agreement very soon in order to obtain the second bailout package worth 130 billion, and in ...