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Far As The Price Is BelowTitle:
Asia shares gain as U.S. data raises hope of Fed easing
(Reuters) - Asian shares rose on Monday as weaker-than-expected U.S. growth data left open the possibility of further monetary stimulus from the Federal Reserve to boost growth, but trading was subdued with Japanese and Chinese markets closed.
The dollar remained pressured by Friday's report showing annual growth in the U.S. economy cooled in the first quarter to 2.2 percent, below a 2.5 percent forecast, and concerns about lower fuel demand brought oil prices lower.
"A flavor of QE (quantitative easing) is back in the air, driving the U.S. dollar lower and risky assets higher," said Sebastien Galy, strategist at Societe Generale.
Asian equities followed the rise in global equities on Friday on the back of strong earnings reports, although Asian growth prospects were clouded as South ...
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Natgas drilling rig count hits new 10-year low
(Reuters) - The number of rigs drilling for natural gas in the United States fell this week to the lowest level in 10 years as historically low prices continued to force producers to slow dry gas operations.
The gas-directed rig count has dropped in 14 of the last 16 weeks, sliding 18 this week to 613, matching the number of rigs drilling for dry gas back in April 2002, data from Houston-based oil services firm Baker Hughes showed on Friday.
The count climbed last week for only the third time this year.
One of the mildest winters on record sharply cut gas demand and built up a huge surplus inventory that has steadily pressured gas prices this year.
Front-month gas futures hit a 10-year low of $1.902 per mmBtu late last week, a level that crimped producer profits and made most dry gas ...
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Weekly Economic and Financial Commentary : 27/04/2012
Weekly Economic and Financial Commentary
U.S. Review
First-Quarter GDP Growth Slows
The U.S. economy grew at a 2.2 percent annual rate in the first quarter, somewhat slower than the consensus had expected. Consumption remained the primary driver of growth as business spending slowed and the government sector continued to scale back spending.
In our U.S. review section this week, we discuss the GDP report in the context of the big miss in durables and consider what it means for business spending going forward. We also look at a very small change in the Fed statement this week that reflects an improving view on the troubled housing sector.
Business Spending Poised for a Slowdown?
Durable goods orders for March were ugly. The 4.2 percent drop was the largest decline since the U.S. ...
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US Employment Data in Focus
The Week Ahead
Highlights
US employment data in focus
Bank of Japan underwhelms
RBA likely to cut
The SNB talks tough on the Swissie
Is the UK economy really that weak?
The Eurozone's growth pact
US employment data in focus
Earlier this week, the Federal Open Market Committee (FOMC) held its 2-day policy meeting. The bank kept policy on hold and upgraded the economic assessment, however comments from Ben Bernanke - which did not provide any new insight in our view - kept Treasury yields low, equity markets supported, and the dollar soft with QE3 speculation back into focus.
Fed projections showed upwards revision to real GDP growth with forecasts of 2.4%-2.9% for 2012 up from the prior 2.2%-2.7% estimate and the unemployment rate forecast was lowered to 7.8%-8% ...
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Oil pares losses after data
(Reuters) - Oil pared lossed on Friday to trade at around $119.90 a barrel after disappointing U.S. data revived hopes of further liquidity injections from the Federal Reserve to boost the flagging economic recovery.
Brent crude, widely used as a global oil benchmark, was down just 5 cents to $119.87 a barrel by 1341 GMT. U.S. crude oil was off 7 cents to $104.48 a barrel.
Oil was sold off earlier in the session after S&P downgraded Spain's credit rating but pared losses when U.S. first quarter GDP figures missed the consensus forecast. The data hit the dollar, and a weaker U.S. currency is supportive of commodities priced in dollars as it makes them cheaper for holders of other currencies.
Some traders also took the view that the below-expectations GDP figure would open the door to a ...
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Asia Session: The BOJ Stays Committed To Achieving Its Inflation Target
The BOJ stays committed to achieving its inflation target, but it fails to impress the market
As we expected the BOJ kept the overnight rate at <0.1%, expanded its asset purchase program by JPY10 trillion and extended the maturity of JGB buying to 3 years from 2 years. There were some market rumours that the bank would disappoint the market by not increasing its APP which was making some investors nervous, thus there were some market moves initially following the release.
USDJPY initially sunk lower on the back of the news, before shooting in the other direction. The only half-surprise to the market from the BOJ was the extension of the BOJ's bond purchases to 3 years. Thus, the Nikkei 225 and USDJPY retraced all of their respective gains shortly after posting them. The Nikkei 225 is ...
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JPY Advances ahead of Bank of Japan
USD remains soft after Bernanke indicated that the door was open for more stimulus if necessary at yesterday's press conference. Markets seemed to focus on this despite the upward revisions to the growth outlook and downward estimates of the unemployment rate this year. Weekly initial jobless claims today came in higher than consensus with a print of 388k from the prior 389k which was revised higher from 386k. The 4-week moving average in initial claims rose by over 6k for the third straight week - not an encouraging sign for the labor market. With employment struggling to gain traction and mixed interpretations of yesterday's FOMC meeting, markets are likely to focus on data surprises and price action will be impacted by QE3 speculation as it is still on the table.
UST yields are lower ...
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Dukascopy Morning Forex Overview : 26/04/2012
Fundamental Analysis
EUR
"There’s a bit of risk back on after some positive company numbers helped stocks and improved the tone of the markets"
- Eric Wand, a fixed-income strategist at Lloyds Banking Group Plc
Demand for Spanish and Italian debt rose, pushing Spanish and Italian bonds higher, as investors turned to higher-yielding assets after companies from Apple to Swedbank reported better than forecast earnings.
USD
"The committee expects economic growth to remain moderate over coming quarters and then to pick up gradually"
- Federal Open Market Committee
U.S. durable goods orders tumbled below forecast in March, a sign the manufacturing sector may be losing momentum. Bookings for long lasting goods dropped 4.2 percent, said the Commerce Department on Wednesday.
GBP
" could be ...
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UK Dips Back Into Recession
Forex News and Events:
UK GDP release today showed that the nation is technically in recession. UK Q1 GDP -0.2% q/q vs 0.1% exp, -0.3% prior; 0.0% y/y vs +0.3% exp, +0.5% prior read. The GBP took a hit on the news falling to 1.6082, but the generally feeling it’s the leading indicators have turned up significantly suggesting the worse is behind the UK. The highlight of the day will be tonights FOMC. The FOMC is expected to keep rates unchanged at 0.25% and maintain the current policy stance when it meets on Thursday. Although we do expect Bernanke to likely signal the end of operation twist at the scheduled end of June timing. We see little evidence of disinflation, but there is a portion of the FOMC which remains mindful of factors that might play out after energy price gains have ...
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