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Jobs Markets ReturnTitle:
Euro Succeeds Short Squeeze
Sunrise Market Commentary
- Fixed Income: Global core bonds take a breather
- Investors remained mostly sidelined in an uneventful session on Friday. The G-8 meeting stressed the need for growth, besides fiscal consolidation and sees Greece staying inside EMU. This shouldn’t surprise markets today. With a razor thin calendar, trading might start the week in a lackluster mode.
- Currencies: Euro succeeds short squeeze
- On Friday, the decline of the euro halted and EUR/USD succeeded a cautious rebound, even as uncertainty on the EMU debt crisis persisted. Technical considerations will also dominate trading today as the G8 meeting provided no high profile measures to address the debt crisis.
The Sunrise Headlines
- US Equities rose for a second consecutive session on ...
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Gold off 4-1/2 month low on increased physical buying
Gold rose more than 1 percent on Thursday, bouncing off a 4-1/2 month low, as weaker prices attracted new physical buyers, but gains were likely to be limited as the euro was undermined by fears of a deepening debt crisis in Greece.
Spot gold rose 1 percent to $1,553.80 an ounce by 09.07 a.m. EDT, from $1,538.30 late in New York on Wednesday, when it plunged to $1,527 - its weakest since December 29.
The precious metal rose to a high of $1,557.56 earlier, helped by the approaching expiry of gold options in the COMEX futures market.
U.S. gold futures hit a high of $1,557.90 an ounce and were at $1,554.30, up 1.1 percent. The contract had plunged to a multi-month low of $1,526.70 on Wednesday.
Gold, traditionally a safe-haven asset, has been moving in tandem with riskier assets such as ...
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Canada's Economy Turns the Hiring Machine Back on
Canada's Economy Turns the Hiring Machine Back on
-58,200 jobs created in April 2012, beating the consensus forecast for a 10,000 increase.
- Unemployment rate inched up to 7.3% from 7.2% in March as the labour force grew by 72,500.
-April marked the second monthly increase in employment and boosted the tally of job gains so far this year to 140,000 or an average monthly gain of 35,000 jobs. This result beat the 29,000 average monthly increase recorded in early 2011 and far exceeds the 8,000 per month pace recorded in the next eight months of that year. This stepped up pace of job creation is more consistent with an economy that grew at an above-potential 2.5% rate last year and is on track to grow at a 1.8% pace in the first quarter of 2012. The weaker performance in first- ...
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Oil choppy; weighs China, OPEC, U.S. jobs data
Oil prices were mixed in choppy trading on Thursday as investors weighed weaker-than-expected Chinese trade data and higher OPEC production against a better picture of the U.S. jobs market, muddling the oil demand outlook.
China, the world's second largest oil consumer after the United States, saw its exports and imports in April grow at a far slower rate than forecast, government data showed.
Its trade performance that month was also surprisingly weak, and analysts said the government would need to loosen monetary policy to spur expansion or risk missing annual growth targets.
The Organization of the Petroleum Exporting Countries said it pumped 1.62 million barrels more per day, to 31.62 million barrels per day last month as Iraq ramped up output and Libya's oil industry recovered.
...
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Greek Elections Lead to Significant Euro Losses
The results of Greek parliamentary elections held over the weekend kept the euro low against virtually all of its main rivals throughout yesterday's trading session. Investor concerns about Greece's new government and how it will act toward tough austerity measures imposed on the country brought the euro down to a 3 ½ year low against the British pound and a three-month low against the US dollar. Turning to today, euro-zone news is once again forecasted to impact the markets. The German Industrial Production figure and a speech from the ECB President have the potential to create significant volatility.
Economic News
USD - USD Takes Slight Losses against Main Currency Rivals
After seeing significant gains when markets opened for the week, the US dollar staged a minor downward correction ...
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Euro Testing Key Support Levels
Sunrise Market Commentary
- Fixed Income Weak US payrolls push core bonds higher again
- On Friday, it was weaker US payrolls that helped core bonds eke out more gains, but non-core bonds held up quite well. Spreads even narrowed in the intra-EMU bond markets. We fear that this won't be the case today, as French and Greek election results inject uncertainty into markets.
- Currencies: Euro testing key support levels
- On Friday, trading in the major euro cross rate was rather calm, but the pressure remained to the downside. The US payrolls were unable to change this pattern. This morning, EUR/USD is testing the key 1.2974 support while EUR/GBP is trading south of the 0.8068 level. A sustained break below these levels would raise a red alert for the single currency.
The ...
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The Weekly Bottom Line : 04/05/2012
The Weekly Bottom Line
HIGHLIGHTS OF THE WEEK
United States
- U.S. job creation may have weakened in the last few months, but the grounds for sustaining stronger employment growth are more fertile now than have been since the economic recovery began. Europe's labor market, by contrast, is likely to deteriorate further before it gets better.
- Europe's (nonfinancial) corporate sector is highly leveraged. As balance sheet adjustments are made, Europe risks further decreases in investment, higher layoffs, and lower economic growth. These effects are compounded by deleveraging in the public sector.
- U.S. corporations, by contrast, are more profitable and liquid than they have ever been. At some point some of these funds will be unleashed towards new investment, creating a positive ...
Title:
When Will Volatility Pick Up
The Week Ahead
Highlights
When will volatility pick up
Digesting payrolls
Will there be more QE for the UK?
Data Watch
When will volatility pick up?
Volatility in US Treasuries is at its lowest level since 2007, so too is volatility in the FX options market for short-term EURUSD products and the Vix has fallen sharply since peaking in autumn 2011. Yet Europe's sovereign stresses remain as strong as ever, Spain and Italy are struggling to sell their sovereign debt to anyone bar their domestic banking sectors and election risks are enormous as Greece and France go to the polls on Sunday.
So why is volatility so low? The answer lies with central banks and fairly tight FX ranges. When central banks come in and pledge that interest rates will remain extremely low until 2014, ...
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European Services Data to Confirm the Coming Recession Ahead of U.S. Jobs Report
Another week is to end today, while markets are fluctuating heavily with the start of the final session, where markets are waiting services data from the euro zone for more confirmations whether the region is slipping into another phase of recession, ahead of the closely watched jobs report from the world's largest economy.
The European common currency as seen yesterday was able to recover most of the losses incurred earlier, where after the European Central Bank rate decision and Draghi's press conference the euro rebounded supported by the downbeat services data from the world's largest economy, which sent the dollar south supporting high yielding currencies to rebound.
Mario Draghi, the European Central Bank President, reassured yesterday that downside risks to growth remain evident, ...
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