Precious metals prolonged slump on Thursday on broadly stronger US Dollar and weak global equities. Moreover, investors started to reduce their holdings in precious metals after the ECB refrained from additional easing measures at the moment. Gold dived under one-week low on lack of additional stimulus from the Fed, ECB and BoE. Meanwhile, traders are cautious ahead of US non-farm payrolls
On Friday, gold advanced first time in five days in London amid speculation investors will start purchasing after gold's worst time in six weeks. Immediate-delivery futures gained 0.3% to $1,593.75 per ounce. December-delivery bullion increased 0.4% to $1,596.60, while bullion tumbled to $1,584.08 per ounce, the lowest level since July 25.
Wall Street fell on Thursday as the ECB announced no plan of action to address Eurozone's debt crisis. The Dow Jones Industrial Index dropped 0.7 per cent, to 12,886.52; the S&P 500 Index tumbled 0.7%, to 1,366.50, and the Nasdaq Composite declined by 0.1 per cent, to 2,917.17. Meanwhile, the ECB is planning to cooperate with governments in bond-purchasing program in order to stimulate Eurozone's economy,
Mario Draghi disappointed markets by providing no action plan to save the Euro, what caused the depreciation of oil on Thursday. Crude oil with September contract fell by 2 per cent, to $87.12 per barrel, before it was stuck for movement in anticipation of ECB's meeting. European leaders failed to meet expectations of markets, after pledging their commitment to protect the Eurozone.
During today's press conference, the ECB's president Mario Draghi, claimed ECB's readiness to resume bond purchasing program as soon as Eurozone's governments will activate bailout funds. The European Central Bank already acquired bonds at a total value of 210 billion euros, but it had a limited impact. At the same time, the ECB left the benchmark interest rate unchanged, at a record low of 0.75
On Thursday, August 2, gold futures fell sharply as the ECB disappointed trader's expectations for bold actions in order to curb Eurozone's debt crisis. Gold futures with the October contract erased 0.79 per cent to $1,592.65 per troy ounce during today's New York trading session. September Silver and September copper also declined, by 1.22 per cent and 1.50 per cent respectively.
More Americans filed applications for jobless benefits last week, the Labor Department reported on Thursday. Initial claims jumped by 8,000 to a 365,000 during the previous week. The department also reported that the number of people already receiving unemployment benefits declined by 19,000 to a 3.27 million people, in the week ended July 21. Meanwhile, monthly employment is growing too slowly in order to lower
The Markit PMI for Britain's services sector unexpectedly slipped to 51.0 last month from 51.3 in June, showing the weakest reading since December 2010 and getting critically close to 50, which marks line that separates expansion from contraction. U.K.'s economy dropped 0.7% in the second quarter of the year, prolonging recession that began late 2011.
New Zealand's currency rose against most of its counterparts after S&P said nation's outlook is stable and affirmed its credit rating. S&P noted New Zealand's flexible economy, fiscal resilience and policy institutions favourable for immediate and decisive policy reform. The kiwi gained 0.4% to 81.32 U.S. cents as well as 0.4% to 63.64 Yen.
The Russian currency declined for a third day and Russia's government debt yields gained after central banks in the U.S., Europe and China failed to introduce immediate policies to support global economy. The Ruble fell 0.2% to 32.55 per Dollar, the currency also weakened 0.2% to 39.677 per Euro. Brent crude advanced to $106.50 per barrel.
Australian and Japanese stock futures declined after the ECB President Mario Draghi failed to convince investors on decisive actions to prop up growth. Increasing Spanish borrowing costs escalated concern over the Eurozone debt crisis as well. Futures on Nikkei 225 Stock Average closed at 8,565 down from 8,630, while futures on S&P/ASX 200 Index lost 0.7%.
German government bonds dropped before a report that is expected to show Eurozone retail sales tumbled in June, boosting concern that the debt crisis stagnates economic recovery. On Friday, the two-year bond yields rose to -0.07%, after touching a record low of -0.097 yesterday. The 10-year note yield advanced to 1.26%.
China's non-manufacturing index slipped to 55.6 from 56.7 in June, as reported by National Bureau of Statistics in Beijing on Friday. The report shows that the decline in China's industrial production and exports may be expanding to services adding weight on Premier Wen Jiabo to find new policies to ease the slowdown.
Spain's service sector activity advanced unexpectedly in June, industry data posted on Friday. Markit Financial Information Services reported that Spain's services PMI increased to a seasonally-adjusted 43.7% last month, from 43.4% in June. The rise exceeded analysts' expectations of decline to 43.0%.
On Friday, Chinese authorities, trying to stop a 14% drop in the nation's stock market, diminished transaction payment on equities trading by 20%. The China Security Regulatory Commission reported that the effect of reduction will be seen Sept. 1 and investors will save 600 million Yuan ($94 million) on transaction fees in the last quarter of the year.
On Friday, National Institute of Economic and Social Research reported that the British economy will tumble 0.5% this year, resulting in miss of George Osborne's budget-deficit target. Osborne will acquire 12.5 billion Pound ($19.5 billion) loan, which is more than projected in the year till March 2013, Niesr announced.
U.S. treasuries continued to top-perform among world's bonds over three straight month before U.S. jobs data, which is expected to show an unemployment rate stagnation at 8.2%. 10-year and longer government securities regained 9.8% in the period, the rise was the biggest among 144 bond indexes. Average 10-year yields were 1.47%, after a record low of 1.38% on July 25.
The common currency weakened against most of its major counterparts after the ECB President Mario Draghi did not offer sufficient steps to curb the Eurozone debt crisis. The Euro lost 0.6% dropping to 95.30 Yen and fell 0.4% to $1.2180. The Pound rose for the first time in 3 days against the Euro after the BOE decided to keep its
The Australian Dollar headed towards 5-day loss before the U.S unemployment report, which might show that employers failed to lower the jobless rate, thus curtailing demand for higher-yielding assets. The Aussie lost 0.1% to 81.84, while declining from $1.0465 to $1.0465 against the US Dollar. On the contrary, the Kiwi gained 0.3% to 81.26 US cents and 0.2% to 63.53
The Canadian Dollar declined against the U.S. counterpart for a third day in a row as the ECB failed to take decisive actions to combat the Euro bloc's debt crisis, hence weighing on investors' risk appetite. The Loonie fell versus most of its 16 counterparts amid declines in crude oil and stocks, weakening 0.2% to C$1.0074 per U.S. Dollar, while
The Japanese Yen rose versus most of its major counterparts, due to escalating Eurozone debt crisis and weakening global growth, which spurred demand for safe haven assets. The Yen gained against the US Dollar for a sixth consecutive week as Asian stocks declined before the U.S. unemployment rate, which expected to show jobless rate above 8%. Demand for the Euro
Oil recovered from the lowest level in almost 3 weeks before job creation report, which might show increased hiring in the US. Analysts expect employers to add 100 000 work places in July. Oil futures gained as much as 0.5%, with Brent crude for September delivery rising 0.3% or 28 cents to $106.18 per barrel.
According to the Commerce Department's report, the number of order to U.S. factories unexpectedly fell in June, signalizing that demand for business equipment in the world's biggest economy contracted. After adding 0.5 per cent in May, the bookings tumbled by 0.5 per cent; while demand for durable goods increased by 1.3 per cent. At the same time, factory inventories rose by 0.1 per cent, while
On Thursday, August 2, European stock turned lower as Mario Draghi's comments failed to meet markets expectation. The Stoxx Europe 600 Index tumbled 0.8 per cent to 260.45 during today's London trading session. At the same time, the U.K.'s FTSE 100 Index declined by 0.6 per cent, Germany's DAX Index erased 1.4 per cent and France's CAC 40 Index fell by 1.6 per cent.