Stocks slumped as the ECB failed to give further indications on the target of the ABS and covered bond purchase program. It appears that the central bank attempted to downplay the target of the balance sheet expansion. Crude oil prices traded with high volatility.
Here is the original:
Market Sentiment Slumped as ECB Disapponted
Mixed economic data damped market sentiment, sending both crude oil and gold prices lower. Disappointing Chinese PMI was partly offset by encouraging UK PMI. However, the mixed US data raised concerns over the country’s recovery outlook. The front-month contract for WTI crude oil initially plunged to a 6-week low of 98.74 before ending the day at 99.42, down -0.32%, while the Brent crude contract declined to as low as 106.85 before settling at 107.76, down -0.29%. Gold was also pressured with the benchmark Comex contract losing -0.96%.
View post:
Investors Holding Breath for US Payrolls
Although Fed’s Vice Chairman Janel Yellen is a well-know dove and her official testimonial statement before the Senate was released beforehand, her comments at the Q&A session yesterday did move the market. Wall Street gained with the DJIA and the S&P 500 indices gained +0.35% and +0.48% respectively. The US dollar and Treasury yields fell amid expectations that QE measures might stay longer.
Original post:
Risk Appetite Soared as Dovish Yellen Maintained Accommodative Bias
WTI-Brent spread has narrowed this week as trading had been rather stretched. Indeed, the CME announced that the daily trading volume for its NYMEX WTI-Brent Crude Oil Spread Option contract (BV) reached a record high of 25 474 contracts on October 23, compared with the previous high of 19 400 on July 1, 2013.
Go here to read the rest:
Gasoline Led Gains in the Oil Sector
Conflicts between the US and Syria continued to dominate headlines with latest news reporting that the US was able to confirm that Syria did use chemical weapons against its civilians because of intercepted “panicked phone calls” between Syrian officials and the commander of a chemical weapons.
Original post:
US and UK Discussed Possible Actions to Handle Syria’s Use to Chemical Weapons
Gold has continued to trade above 1300 in European session. The rally yesterday amid decline in the US dollar has sent mixed signals about the yellow metal’s turnaround. Goldman Sachs has remained bearish over gold price, forecasting that it would decline further in the medium-term “given our US economists’ forecast for improving economic activity and a less accommodative monetary policy stance”.
Originally posted here:
Gold’s Recent Rally Fails to Change Bearish Views
UK sterling to the US dollar exchange rate is holding steady in currency markets today as traders await the details surrounding the US Fed’s decision on asset purchases which may or may not begin the process of normalising monetary policy in the US.
Latest UK Sterling Rates
As of 10:26 GMT today, one pound UK sterling bought 1.16670 euro (0.13 percent lower) and against the US dollar the rate was $1.56240 (0.13 percent lower). A weaker British pound makes commodities including oil prices more expensive for UK consumers, whilst some believe that UK exports will get a boost on a devalued UK currency.
Fed Meeting – Details
Investors are waiting to see if the US Fed, which wraps up a two day policy meeting later in today in America will make changes to its strategy of low interest rates and easy money that is helping to shore up the American economy. Any change is likely to ripple through the markets this afternoon.
Bank of England & QE
Mark Carney, the incoming governor of the Bank of England who starts his new role in July may want to devalue UK sterling to help reverse Britain’s sluggish growth, the world’s biggest bond fund Pimco has predicted.
Mike Amey, head of sterling portfolios at Pimco, said that Carney could attempt to depreciate UK sterling by as much as a massive 15 percent from today’s rates as he seeks to help British exporters tap into foreign demand. Such a move may or may not help Britain to recover from its worst recession in 50 years.
Meanwhile, Adam Posen, the external member of the Bank of England’s Monetary Policy Committee has upped his call for more quantitative easing (QE) to £100 billion and proposed a public bank for businesses struggling to find credit on the high street.
Posen has long been the MPC’s lone voice calling for a £50bn increase in the asset purchase programme which has seen the bank buy up £200 billion of gilts on the secondary market to help kick start the UK economy.
However, more QE in the UK may not be such a wise idea. The best thing that Mark Carney could do is probably to ease off the money printing. But investors are going to be looking at Carney and asking if he’s paid so much, why doesn’t he do something smart? Maybe he will be forced by media pressure to show he’s worth his salt, but what can he do? He could either raise UK interest rates and crash the UK housing market and maybe a few banks along the way, or pump up the printing machine and wreck savings further?
One thing is for sure, it seems that Mark Carney is not alone with a view to more QE coming to the UK soon.
Original post:
UK sterling to dollar holds steady as traders await Fed meeting details
Asian shares climbed higher on Monday ahead of the FOMC meeting. Investors continued to gauge policymakers’ opinions on whether or when to taper QE measures. Bond guru Bill Gross anticipates the Fed would end QE later this year. His forecast was not driven by expectation of sustainable recovery in the US economy but the Treasury will lack bonds to issue due to lower than expected deficits.
Go here to see the original:
Asian Shares Climbed Higher although Gross Expected Fed to Taper QE This Year
Wall Street gained on improvement in economic data although speculations of Fed’s early exit remained popular. Initial jobless claims slipped to 346K in the week ended June 1 from an upwardly revised 357K in the prior week. The 4-week moving average, however, gained +5K to 353K, the highest level since April 20. The DJIA and the S&P 500 indices added +0.53 and +0.85% respectively.
Go here to see the original:
Sentiment Improved on US Job Data, Market Awaits Payrolls Report
Asian shares soared as Cyprus reached a last minute deal over the weekend ahead of the deadline set by the ECB. Cyprus Popular Bank, also called the Laiki, would be shut down and split and the good assets would be taken over by the Bank of Cyprus together with 9B euro provided by central bank through the ELA.
View original post here:
Sentiment Improved on New Cyprus Plan