Forex Overnight: EUR trading under pressure
The EUR has weakened against most of the major currencies, this morning, ahead of the German and Portuguese bond auctions worth €5.0 billion and €1.0 billion, respectively, later today. Traders are also keeping an eye on the Eurozone consumer price inflation data slated for release today, which is expected to show that inflation in December eased from a three-year high. At 6 am, the EUR has lost 0.1 percent each against the USD and the GBP, to trade at $1.3032 and £0.8335, respectively.
The JPY has advanced 0.2 percent against the EUR, while it has gained marginally against the USD.
The AUD and the CAD are trading 0.2 percent lower each against the USD.
UK Stocks: Expected to open weaker
The FTSE 100 is likely to open 9 to 17 points lower.
Construction Purchasing Managers’ Index (PMI), Net Consumer Credit, Net Lending Secured on Dwellings, Mortgage Approvals and M4 Money Supply are the key economic indicators scheduled for release today.
William Sinclair Holdings is scheduled to report its results today.
Royal Dutch Shell has closed oil flows of 70,000 barrels per day from the Nembe Creek Trunkline in Nigeria, due to a leak caused by the theft of crude oil.
According to Bloomberg, BP will shut several gasoline-making units at its California refinery in March for planned maintenance. However, Scott Dean, a BP spokesman, has declined to comment on the planned work.
Asia: Trading mostly in negative territory
Asian markets are trading mostly lower this morning.
In Japan, Elpida Memory has edged up, amid reports that it is in discussion with Toshiba Corporation for a possible integration of their operations. Banking sector stocks, Mitsubishi UFJ Financial Group and Sumitomo Mitsui Financial Group have rallied, following an upbeat broker comment on the Japanese banking sector. Komatsu has advanced, amid reports that it plans to invest up to ¥15.0 billion to increase capacity at three domestic factories by March 2014. Automakers, Toyota Motor Corporation, Honda Motor and Nissan Motor have added value, following expectations of an improvement in automobile demand. At 6 am, the Nikkei 225 index has climbed 1.2 percent to trade at 8,553.5.
In South Korea, Nong Shim Holdings is trading lower, amid reports that a group of supermarkets is planning to boycott its instant noodle products. In Hong Kong, Swire Pacific Limited has slumped, after a broker indicated that the company may be valued differently by investors as it proposes to spin-off its property unit. In China, Shenzhen Development Bank and China Citic Bank Corporation are trading in the red, after Premier, Wen Jiabao, stated that business conditions may be “relatively difficult” this quarter. China Cosco Holdings has dropped, after an index of export orders, released yesterday, indicated a third month of contraction in December.
US Stocks: Futures trading weaker
At 6 am, S&P 500 futures are trading 0.7 points in the red.
Key economic indicators scheduled for release today include MBA Mortgage Applications, Factory Orders, Total Vehicle Sales and Domestic Vehicle Sales.
UniFirst Corporation, Resources Connection, Sonic Corporation and National American University Holdings are scheduled to announce their results later today.
Team Inc jumped 4.4 percent, in after hours trading session yesterday, after it reported robust second quarter earnings and raised its revenue and earnings outlook for FY2012. TiVo surged 14.0 percent, after AT&T agreed to pay the former at least $215.0 million to settle a patent lawsuit. Among other major gainers, ITT Educational Services and I.D. Systems rose 7.2 percent and 4.2 percent, respectively. On the other hand, Acme Packet and National Instruments Corporation slumped 17.5 percent and 6.1 percent, respectively, after they reduced their fourth quarter revenue and earnings guidance. Eastman Kodak dropped 0.7 percent, after it received a notice from the New York Stock Exchange regarding non-compliance with listing requirements. Among other key losers, ReachLocal and HomeAway lost 8.3 percent and 3.9 percent, respectively.
The S&P 500 index advanced 1.5 percent in the regular trading session yesterday, as better-than-expected manufacturing data globally outweighed concerns about the European sovereign debt crisis. Coal producers, Peabody Energy Corporation and Alpha Natural Resources soared 9.5 percent and 8.0 percent, respectively, after a U.S. Federal court late last week delayed an air-pollution rule that was slated to take effect from 1 January 2012. Commodity sector stocks, Freeport-McMoRan Copper & Gold, Alcoa and United States Steel Corporation jumped 7.4 percent, 6.7 percent and 6.5 percent, respectively, amid optimism that strong manufacturing data will translate into increased demand for metals. Mead Johnson Nutrition rose 3.8 percent, after U.S. regulators indicated that they did not find any evidence of a connection between the company’s baby formula and illnesses in four infants. Cisco Systems advanced 3.4 percent, after a broker upgraded its rating on the stock to “Over-weight” from “Neutral”. On the other hand, Tenet Healthcare Corporation slumped 3.3 percent, after a broker downgraded its rating on the stock to “Sell” from “Neutral”.
European Stocks: Likely to open in the red
The DAX and CAC are expected to open 22 to 28 points and 16 to 18 points lower, respectively.
German, French & Eurozone Services PMI, French Consumer Spending and Eurozone Composite PMI & Consumer Price Index Estimate are the key economic indicators scheduled for release today.
No major corporate releases are scheduled for today.
The U.S. Justice Department has stated that the American unit of A.P. Moller-Maersk has agreed to pay $31.9 million to settle claims that it overcharged the U.S. military for transporting cargo to support American troops in Afghanistan and Iraq.
According to Bloomberg, the Board of UniCredit SpA plans to set the terms of its €7.5 billion rights offering at a meeting scheduled today.
Bloomberg has reported that Vestas Wind Systems A/S will announce a significant change to its corporate structure on 12 January 2012, after it lowered its revenue outlook recently, for the second time since October 2011.
Solaria Energia y Medio Ambiente SA has sold a solar-power plant in Germany to Solaria DTL Corporation SL for a consideration of more than €18.0 million.
Macro Update
Fed to communicate rate forecast
The minutes of the Federal Reserve’s (Fed) latest monetary policy meeting has indicated that Fed officials will start announcing their forecasts for the central bank’s key interest rate in an effort to enhance the clarity and transparency of its public communication.
China’s 2012 financing to be around CNY 14.0 trillion
According to a research report published by the state-run Shanghai Securities News, China’s total national financing will probably increase to around CNY 14.0 trillion in 2012, from an estimated CNY 13.0 trillion in 2011.
Singapore expects 2 years of sub-par growth, says Finance Minister
Tharman Shanmugaratnam, the Finance Minister of Singapore, has stated that the country may enter a period of slower growth for at least two years due to problems in the global economy.
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