Forex Overnight: EUR trading weak
The EUR is trading lower against its major counterparts, this morning, with markets keenly awaiting the outcome of the meeting between German and French leaders and the German industrial production data later today. Additionally, reports over the weekend suggesting that the International Monetary Fund was losing confidence in Greece to resolve its debt crisis also weighed on the Euro. At 6 am, the EUR has declined 0.1 percent each against the USD and the GBP, to trade at $1.2705 and £0.8237, respectively.
The JPY has gained marginally against the USD, while it has advanced 0.1 percent against the EUR.
The AUD has declined 0.6 percent against the USD, following weaker-than-estimated Australian retail sales for November.
UK Stocks: Expected to open in negative territory
The FTSE 100 is likely to open 17 to 25 points in the red.
No major economic and corporate releases are scheduled for today.
The Sunday Times has reported that Royal Bank of Scotland may offer a multi-million pound dowry to bidders for its stockbroking business, in an effort to secure a sale.
British Sky Broadcasting is buying a 10.0 percent stake in Zeebox, a social networking and social television website, for an undisclosed sum.
According to the Sunday Telegraph, William Morrison Supermarkets is in advanced talks with Carphone Warehouse to acquire 11 “big box” retail stores being vacated by Best Buy, in a move to convert them into its Kiddicare brand.
The Financial Times has reported that the Mecom Group is mulling selling its Polish division.
Asia: Trading mostly lower
Asian markets are trading mostly lower this morning, ahead of the crucial Merkel and Sarkozy meeting in Berlin today.
Japanese markets are closed today on account of Coming of Age Day.
In South Korea, downbeat broker comments led Samsung Electronics to edge lower. Korean Air Lines and Asiana Airlines are trading lower, after Incheon International Airport Corporation reported a decline in December cargo traffic. In Hong Kong, Li & Fung has edged down, after Federal Bank of St. Louis President, James Bullard, indicated that the Federal Reserve will probably wait to take the decision about more accommodative policies, amid “encouraging” U.S. economic data. Resource sector stocks, Aluminum Corporation of China and Jiangxi Copper have lost value, amid concerns about slowing demand. In China, financial sector stocks, Industrial & Commercial Bank of China, Agricultural Bank of China and Bank of China have advanced, amid speculation that monetary conditions may be easing, after data indicated that Chinese lending and money supply growth exceeded market consensus in December.
US Stocks: Futures trading weak
At 6 am, S&P 500 futures are trading 6.1 points in negative territory.
Consumer Credit Change is the key economic indicator scheduled for release today.
Key corporate results scheduled for release today include Alcoa, Schnitzer Steel Industries, Mistras Group, Standard Microsystems and VOXX International.
IPC The Hospitalist Company plummeted 14.6 percent, in after hours trading session on Friday, after it slashed its revenue and earnings guidance for FY2011. Lululemon Athletica lost 1.8 percent, after it announced that its founder, Chip Wilson, will step down from his position as Chief Innovation and Branding Officer. Among other key losers, Federated Investors and Lucas Energy dropped 4.1 percent and 3.4 percent, respectively. On the other hand, SunCoke Energy soared 6.5 percent, following the announcement that it expects a robust increase in its U.S. coke production for the fourth quarter. Among other major gainers, Complete Genomics and Halozyme Therapeutics jumped 6.7 percent and 5.3 percent, respectively.
The S&P 500 index lost 0.2 percent in the regular trading session on Friday, as concerns over the European debt crisis outweighed a drop in the U.S. unemployment rate. Lower-than-anticipated first quarter revenue led Family Dollar Stores to plunge 7.5 percent. Financial sector stocks, Genworth Financial, Morgan Stanley and Bank of America Corporation fell 2.7 percent, 2.3 percent and 2.1 percent, respectively, after a Federal official denied rumours that the government is considering a trillion-dollar nationwide mortgage refinancing program. Downbeat broker comments about Hasbro’s fourth quarter results led the stock to shed 2.3 percent. Alcoa dropped 2.1 percent, after it announced plans to reduce its global smelting capacity. On the other hand, Apollo Group jumped 5.4 percent, after it reported new-enrolment growth for the first time in at least a year. JC Penney Company advanced 3.5 percent, after a broker upgraded its rating on the stock to “Out-Perform” from “Neutral”.
European Stocks: Likely to open in the red
The DAX and CAC are expected to open 31 to 38 points and 22 to 26 points, lower, respectively.
German Trade Balance, Industrial Production & Current Account, French Trade Balance, Eurozone Sentix Investor Confidence and Swiss Unemployment Rate & Retail Sales are the key economic indicators scheduled for release today.
No major corporate releases are scheduled for today.
Novartis AG has stated that it is voluntarily recalling some over-the-counter products in the U.S., including its Excedrin headache pills and NoDoz medication, over packaging concern.
Martin Winterkorn, the CEO of Volkswagen AG, has stated that the company sold almost 8.22 million cars and trucks globally in 2011.
Jonathan Browning, the head of the U.S. division of Volkswagen AG, has stated that the company plans to sell more than 500,000 cars in the U.S. in 2012, compared to 444,192 vehicles sold last year.
Daimler AG and Nissan Motor have stated that they plan to build four-cylinder Mercedes-Benz and Infiniti gasoline engines together at a Nissan plant in the U.S.
Reuters has reported that E.ON AG has at least five potential bidder groups for its gas distribution network and is asking them to indicate interest by 20 January 2012.
Macro Update
New Fed buying unlikely in the near term, says Bullard
James Bullard, the President of the Federal Reserve Bank (Fed) of St. Louis, has stated that the Fed will not probably initiate a new round of bond purchases at least in the short term, following “encouraging” jobs data.
Australian retail sales remain unchanged
On a seasonally adjusted monthly basis, retail sales in Australia remained unchanged in November, compared to a 0.2 percent rise recorded in October.
Australian new home sales surge
On a seasonally adjusted basis, Australia’s new home sales have climbed 6.8 percent M-o-M in November, following a downwardly revised 2.8 percent rise posted in October.
Australia’s construction activity rises
The Australian Performance of Construction Index has risen to a reading of 41.0 in December, compared to a reading of 39.6 recorded in November.
South Korean producer price inflation eases
The annual producer price inflation in South Korea has eased to 4.3 percent in December, the first time since November 2010 that the inflation has dropped below 5.0 percent, and compared to a 5.1 percent rate recorded in November.
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