Industrial metals prolonged their rally on Monday on escalated hopes for easing measures in the US and China. Meanwhile, market participants anticipated an outcome of the German Constitutional Court hearing regarding the ESM existence. Aluminum climbed on hopes that recent negative headlines from the US and China will force the central banks to implement stimulus measures. Copper rallied to three-month high on
US equities dropped on Monday amid increased cautiousness in the market ahead of the German Constitutional Court decision on whether to suspend the ESM. Recent pessimistic data releases from the US and China also added pressure on the US stocks. Even speculation that the Fed and POBC will loosen their monetary policies failed to buoy US shares. The S&P 500
Precious metals were mixed on Monday, with platinum and palladium extending previous gains and gold and silver retreating. Mounting hopes that the Fed will ease its monetary policy failed to lift gold and silver. Meanwhile, market players were cautious ahead of the German Constitutional Court decision on whether to suspend the ESM. Gold retreated from recent highs despite speculation that US
Natural gas futures soared 5% and reached a four-week high on Tuesday, as traders looked for the U.S. government's report on natural gas stockpiles scheduled for later this week. October natural gas rocketed 4.5% to$2.939 per million British thermal units.
Wall Street turned green on Tuesday, as Germany's highest court announced it won't delay its ruling on the Eurozone's permanent bailout fund. The Dow Jones Industrial Average rose 0.3%, to 13,280; the Standard & Poor 500 Index gained 0.41%, to 1,432.30, while Nasdaq-100 futures jumped 0.3%, to 2,792.75.
The U.S. trade deficit widened a slight 0.2%, as both exports and imports fell. Nation's trade deficit widened to a seasonally adjusted $42.0 billion in July from $41.9 billion in prior month, the U.S. Bureau of Economic Analysis said on Tuesday. Overall U.S. imports fell 0.8% to $225.3 billion, down from $227.1 billion, while exports declined by 1% to $183.3 billion from $185.2 billion in
On Tuesday, prices for treasuries declined, pushing yields up, as investor eyed the upcoming auction of 3-year government debt in the U.S, which may provide some clue on the discount potential of another round of monetary stimulus. Yields on 10-year notes gained 2 basis rose, and reached 1.68%. While yields on 3-year bonds increased by 0.01%, reaching 0.33%.
OECD area's unemployment rate rose slightly in July, following a cut of a modest fall in the preceding month. The jobless rate surged to 8% from 7.9% in June. On yearly basis, the rate was stable. July data shows 47.9 million unemployed people in the OECD, with Spain posting a rate of 25.1%, Eurozone 11.3%, U.S. 8.3% and Japan 4.3%.
Germany's statistics office said that wholesale price index in Europe's biggest economy picked up pace in August. Nation's Wholesale Price Index rose 1.1% month-on-month, up from 0.3% in July, and added 3.1% year-on-year, as compared to a 2% climb in the previous month. In the meanwhile, forecasts were around 0.3% increase on monthly basis and 2.2% on yearly basis.
As reported by the Ministry of Finance, Japanese Business Index Survey of large manufacturing conditions, which measures business sentiment in manufacturing, rose to a seasonally adjusted annual rate of 2.5 in the third quarter, up from -5.7 in the prior quarter. Analysts had predicted Japan's BSI manufacturing index to fell to -6.1. A reading above 0.0 indicates optimism, below indicates pessimism.
On Tuesday, Spanish 10-year government bonds declined for the second consecutive day amid speculations that Spain will not seek for bailout. The yield on 10-year government debt in Spain added 3 basis points and reached 5.73%. Yesterday, the yield on bonds due January 2022 increased by 7 basis points. The Spanish 2-year note yield gained nine basis points, reaching 2.98%.
On Tuesday, the Euro grew versus the U.S. Dollar to almost 4-moth high on upcoming German court decisions about the country's role in European bailout plan and possible round of monetary stimulus in the U.S. The Euro gained 0.2% and reached USD1.2779 at 7:32 New York time. Earlier in the day, it hit USD1.2819, which was an almost 4-month high.
Fitch Ratings on Tuesday confirmed New Zealand's major ratings despite significant external indebtedness and worldwide economic slowdown. The long-term foreign currency Issuer Default Ratings was affirmed at "AA", while local currency rating was at "AA+", with stable outlook.
The Sterling climbed to a four-month high against the U.S. counterpart after a report posted the U.K. trade gap narrowed in July amid surge in exports, adding signs the economy is coming out of recession. On Tuesday, the Pound rose 0.2% to $1.6021, after reaching $1.6037, the highest since May 15, and was little changed versus the common currency at
On Tuesday, futures for oil were traded close to 3-week high on expectations of further monetary stimulus in U.S. and concerns over Europe's bailout plan. On the NYMEX, October delivery futures for crude were traded at USD96.50 per barrel at 12:12 London time, which was a USD0.04 decline. Yesterday, the contracts grew to USD96.54, which was a 3-week high.
Gold advanced as investors await Fed's meeting at Sept. 12-13 and Ben Bernanke signaled a possibility of an additional round of quantitative easing. On Tuesday, gold for December delivery gained 0.1% to $1,734.10 per ounce in New York, while immediate-delivery metal surged 0.3% to $1,371.82 per ounce in London.
The Shanghai Composite Index lost 0.7% and closed at 2,120.55 points. Today's performance was the worst in a week, after the index rallied by 4.8%, when China's government approved huge domestic infrastructure projects. Asian stocks fell after auto sales data was below estimations and Macquarie Group Ltd cut China's growth outlook from 8.1% to 7.7%.
The German Federal Statistical Office reported on Tuesday that the wholesale price index in Germany grew to 1.1%, compared to the August's figure of 0.3%. This was a higher than expected growth, since analysts expected that the index would held steady and be equal to the previous month's reading of 0.3%.
The Office for National Statistics reported on Tuesday that the U.K.'s trade deficit decreased in July to GBP7.2 billion from the June's figure of GBP10.1 billion. Economists, however, expected that the trade deficit would witness a more modest decline and would be equal to 9 billion pounds. Britain's export grew by 9.3%, while imports decreased by 2.1%.
The South Pacific currencies, namely the Australian and New Zealand Dollar, stayed lower amid weak demand for commodity currencies on escalating concern about China's economic slowdown. The Aussie Dollar was little changed at $1.0330 following a 0.5% decline yesterday, the biggest decrease since September 3. The Aussie touched 80.80 Yen from 80.91. The Kiwi fetched 80.95 U.S. cents from 80.88.
Consumer credit in the U.S. unexpectedly fell in July for the 1st time in a year. According to the Fed, a $3.28 billion decline followed a revised $9.8 billion increase in a month earlier, beating economists' expectations of $9.2 billion jump. Revolving credit including credit card spending dropped $4.2 billion, the most since 2011.
The Canadian Dollar reached 1-month high against the U.S Dollar and outperformed all of the major counterparts as investors await the Fed will introduce more stimulus measures to prop up growth. The Loonie gained 0.1% to 97.76 cents per U.S. Dollar, following an earlier rise to 97.55 cents, the highest level since September 2011. One Canada's Dollar buys $1.02291.
The U.S. Dollar weakened versus most of the 16 major counterparts before the FOMC's 2-day meeting tomorrow. The Dollar Index fell 0.1% to 80.361, 4-month low, on speculation the Fed will launch third round of QE, which usually debases the Dollar. The USD lost 0.1% to 78.22 Yen and 0.1% to $1.2765 per 17-nation currency.
The U.S. trade deficit probably expanded in July after narrowing to almost 2-year low as a global slowdown curbed demand for US-made goods. The gap increased from $42.9 billion in June to $44 billion in July. Weakening economies in emerging markets like China and debt-stricken Europe may start curtailing demand for American goods, a source of the expansion in the Q2.