European Central Bank
European stocks rose to a new five-year high on Wednesday, backed up by Federal Reserve Chairman Ben Bernanke’s statement that the Fed would retain its monetary stimulus until the economic improves.
The Stoxx Europe 600 Index added around 0.2 percent to 310.59 today. The equity benchmark closed at the highest level since June 2008 yesterday. The gauge has rallied 96 percent since March 2009 as European Central Bank President Mario Draghi pledged to preserve the euro and the Fed embarked on three rounds of stimulus.
STOXX 600 ended higher today by 0.19% at 310.59; STOXX 50 ended also in green, higher by 0.47% at 2835.01.
CAC 40 Index
The French benchmark index ended in the green today to settle at 4051.11, higher by 14.93 points or 0.37%. The index opened at 4035.43 recording a high ...
European Market Update
UK retail sales data comes in negative and well expectations; markets ahead Bernanke testimony for hints of QE tapering
Notes/Observations
Bank of Japan (BoJ) leaves policy unchanged (as expected). Upgrades economic outlook for 5th straight month
Japan Apr trade deficit worse than expected but smallest deficit in three months
Australia consumer confidence sees biggest drop in 17 months
USD corrects from recent strength as markets might have gotten ahead of itself on the debate over tapering of QE
UK retail sales come in negative and below expectations; cold weather blamed
Economic Data
(HU) Hungary Mar Avg Gross Wages Y/Y: 3.2% v 3.0%e
(DK) Denmark May Consumer Confidence: -2.6 v -2.5e
(EU) ECB: €206M borrowed in overnight loan facility vs. €190M prior; € ...
Sunrise Market Commentary
- Rates: Core bonds rebound on technical levels and dovish Fed Bullard
- In a session devoid of key eco releases, core bonds initially continued to move South, approaching key support levels in the US session. Afterwards, dovish comments of Fed Bullard triggered short covering as investors also eyed today's testimony of Bernanke.
- Currencies: Soft Fed speak triggers USD profit taking
- EUR/USD initially drifted south in technical trading yesterday. At the end of the day, soft comments from Fed Bullard pushed EUR/USD north of the 1.29 mark. Sterling was hit as a sharper than expected decline in inflation made markets think that there is still room of maneuver for the incoming BoE governor. EUR/GBP is trading north of 0.8500.
The Sunrise Headlines
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European shares opened mixed on Wednesday session as caution dominated markets ahead of minutes from the Bank of England and the United States Federal Reserve followed by Fed’s Chairman Ben S. Bernanke testimony before the Joint Economic Committee of Congress.
- Benchmark STOXX Europe 600 dropped 0.30 percent or 0.92 points to 309.07
- STOXX 50 fell 0.35 percent or 9.84 points to 2,823.55
Investors will turn their attention to the release of the Federal Open Market Committee minutes later todaym, looking for any signs after FOMC members indicated that they intend to end their 85 billion monthly bond purchases sometime in 2013.
Investors will be eyeing Fed’s Chairman Ben S. Bernanke, as he is scheduled to testify before the Joint Economic Committee of Congress later in the day for ...
Crude oil may extend its losses on Wednesday ahead of Bernanke`s testimony later in the day, as concerns over demand from the world`s top oil consumer were triggered following the unexpected rise in crude stockpiles last week.
Besides the housing and retail sales data set for later in the day from the U.S. and UK, investors are awaiting the U.S. Federal Reserve chief Ben Bernanke`s testimony amid believes the bond-buying stimulus has further to run.
Adding to the downside pressures on oil was the report by the American Petroleum Institute released Tuesday and which showed that U.S. crude oil stockpiles rose by 532,000 barrels last week although inventories were expected to drop.
The U.S. Energy Information Agency (EIA) will release its data on inventories later on Wednesday. The report ...
European stocks ended slightly higher, yet below record highs on Tuesday, with Britain’s FTSE 100 shooting past its 13-year high amidst a barrage of company results, and continued stimulus support from world central banks.
Such stimulus by global central banks - including asset purchases and ultra low interest rates - has been the key driver of equity market gains over the past year.
London`s benchmark FTSE 100 index added 0.71 percent to 6,803.87 points, surpassing the 13-year closing high point reached a day earlier.
Carnival, the world’s largest cruise operator, slid 5.9 percent. Daimler AG declined 2.1 percent as a gauge of automakers fell from the highest close since 2007. Marks & Spencer Group Plc rallied 4.8 percent after saying it will reduce capital spending in an effort to ...
European Market Update
UK inflation comes in lower than expected and offers BOE more room to stimulate if data does disappoint
Notes/Observations
RBA minutes: rate cut appropriate to boost growth; subdues growth & inflation provided room to cut rates; AUD high by historical standards
The USD/JPY was steady after the Japanese Econ Min Amari backed off from his comments expressing satisfaction with the current value of the JPY
Germany's Chancellor Merkel said to be considering certain treaty changes aimed at giving more powers to Brussels
Draft EU law to protect insured bank depositors under €100k; larger depositors could suffer losses after equity and bond holders hit
UK inflation comes in lower than expected and offers BOE more room to stimulate if data does disappoint
Thursday ...
The dollar gave up some of its recent gains against other major currencies on Monday amid bets the Federal Reserve will slow its stimulus program on signs the world’s biggest economy is accelerating.
Dallas Federal Reserve’s President Richard Fisher told CNBC reporters earlier that a scale back for the Fed’s monthly $85 billion in bond purchases should be the key, as halting it would be “too violent for the market.”
Fishers comment came days after the Federal Reserve Bank of San Francisco’s President John Williams said that quickening economic growth and an improving labor market may prompt the central bank to start pulling its $85 billion of monthly bond purchases by summer.
The U.S. dollar extended gains after Williams commented that quickening economic growth and gains in the labor ...
European Market Update
Whit Monday holiday has Europe on the sidelines
Notes/Observations
Nikkei225 index trades higher than the US Dow Industrial 30 index for the first time since May 2010
Ceasefire in the currency war ??? Japan Econ MIn Amari suggesting that excessive gains have already been corrected by a large amount and any further weakness could actually become a detriment
Short-range North Korea missile launch into the Sea of Japan this weekend
China property sector retained its allure despite the govt steps to curb housing inflation. April property prices across 70 cities rose 4.9% y/y - the biggest increase since Apr 2011
European market participation light die to Whit Monday holiday (Pentecost)
Economic Data
(JP) Japan Mar Final Leading Index CI: 97.9 v 97.6 prelim; ...