Forex Overnight: EUR trading under pressure
The EUR is trading lower against the USD, this morning, amid rising concerns about the European debt crisis, after French bond yields rose at an auction yesterday. Markets are eagerly awaiting the release of Eurozone consumer confidence and U.S. non-farm payrolls data later today. At 6 am, the EUR has declined 0.1 percent each against the USD and the GBP, to trade at $1.2771 and £0.8247, respectively.
The JPY is trading 0.1 percent lower against the USD, while it is trading flat against the EUR.
The AUD has weakened 0.3 percent against the USD, amid waning demand for high yield currencies.
UK Stocks: Expected to open lower
The FTSE 100 is likely to open 3 to 7 points in the red.
New Car Registrations for December is the key economic indicator scheduled for release today.
Terrace Hill Group is scheduled to report its results later today.
The Financial Times has reported that Royal Dutch Shell is likely to close its U.K. final salary pension scheme to new workers from 2013.
The CEO’s of BP and ConocoPhillips have stated that the only way to exploit vast but stranded quantity of Alaska’s North Slope natural gas is to export it to Asia Pacific markets.
Asia: Trading in negative territory
Asian markets are trading in the red, this morning, as rising pessimism about the European sovereign debt crisis overshadowed positive U.S. jobless claims data.
In Japan, shipping sector stocks, Nippon Yusen K.K., Kawasaki Kisen Kaisha and Mitsui O.S.K. have edged lower, following a sharp decline in the Baltic Dry Index yesterday. Mitsui Chemicals has slid, after a broker downgraded its rating on the stock to “Neutral” from “Over-weight”. Chip makers, Elpida Memory and Renesas Electronics Corporation have lost value, after a broker lowered its 2012 guidance for global DRAM shipment growth. At 6 am, the Nikkei 225 index has lost 1.2 percent to trade at 8,285.5.
In South Korea, SK Holdings has lost value, after its Chairman, Chey Tae Won, was indicted on embezzlement charges. Daewoo Shipbuilding & Marine Engineering has dropped, following news that Korea Development Bank plans to revive the sale of its stake in the company. In Hong Kong, Esprit Holdings has edged lower, amid rising concerns about the European debt scenario. In China, SAIC Motor Corporation has slumped, following renewed growth worries. On the other hand, PetroChina has jumped, following news that the government has increased the threshold of a windfall tax on crude oil.
US Stocks: Futures trading weak
At 6 am, S&P 500 futures are trading 4.0 points lower.
Unemployment Rate, Change in Non-farm, Private & Manufacturing Payrolls, Average Hourly Earnings and ICSC Chain Store Sales are the key economic indicators scheduled for release later today.
Key corporate results scheduled for release today include IHS Inc, Robbins & Myers, PriceSmart, Commercial Metals Company and Greenbrier Companies.
In after hours trade yesterday, Jazz Pharmaceuticals jumped 4.2 percent, after it guided to higher-than-expected earnings for FY2012. Oritani Financial Corporation and Human Genome Sciences featured among other gainers, rising 4.2 percent and 2.7 percent, respectively. On the other hand, worse-than-estimated revenue guidance for the third quarter led RF Micro Devices to edge 15.8 percent lower. Family Dollar Stores shed 2.9 percent, after it reported lower-than-expected first quarter revenue. Among other key laggards, Morgans Hotel Group and Zoltek lost 5.2 percent and 4.0 percent, respectively.
The S&P 500 index closed 0.3 percent higher in the regular trading session yesterday, as improving jobless claims data reinforced optimism about the economy. Banking sector stocks, Bank of America Corporation, Suntrust Banks and Fifth Third Bancorp soared 8.6 percent, 5.4 percent and 2.9 percent, respectively, amid speculation that the U.S. government may introduce a nationwide mortgage refinancing program. However, Federal officials later denied that administration is considering any such plans. LSI Corporation jumped 7.7 percent, after a broker upgraded its rating on the stock to “Out-Perform” from “Neutral”. Monsanto surged 5.5 percent, as it reported better-than-anticipated first quarter earnings. Macy’s advanced 3.9 percent, after it reported higher-than-estimated same store sales for December. On the other hand, lower-than-expected fourth quarter net new additions led MetroPCS Communications 8.9 percent down. Tesoro Corporation plunged 5.9 percent, after it reported a loss for the fourth quarter, missing market estimates for a profit.
European Stocks: Likely to open in the red
The DAX is expected to open 0 to 6 points lower, while the CAC is likely to open 1 point higher to 3 points lower.
Key economic indicators scheduled for release today include German Factory Orders, Eurozone Retail Sales, Unemployment Rate, Business Climate Indicator, Economic & Consumer Confidence Index and Swiss Consumer Price Index.
Bell AG is scheduled to report its results later today.
ArcelorMittal SA has stated that its ArcelorMittal Annaba unit in Algeria is not in default and that both the shareholders of the unit will temporarily offer a guarantee in order to resolve the situation.
Transocean Limited has stated that the Executive Vice President and Chief Financial Officer, Ricardo Rosa, will quit the company, with effect from 9 January 2012.
Les Echos has reported that Natixis will probably announce “several hundred” job cuts at its corporate and investment banking unit next week.
In an interview with Boersen- Zeitung, Markus Gunter, the CEO of DAB Bank AG, has stated that the company expects profit growth in 2012, following a marginal decline last year.
Macro Update
Germany is biggest barrier to raising emergency funds, says Knot
Klaas Knot, the Governing Council member of the European Central Bank, has stated that Germany is the “most important” obstacle in raising the European emergency fund, and urged Germany to support raising the fund to help contain the region’s sovereign debt crisis.
China seeks to spur consumption, says Chen
Chen Deming, the Commerce Minister of China, has stated that the country will roll out measures to bolster consumption in 2012, as it strives to meet challenges posed by a global economic slowdown.
China’s FDI rises in 2011
The China Daily has reported, citing a statement by Liu Yajun, Director-General of the Department of Foreign Investment Administration with the Ministry of Commerce, that China’s Foreign Direct Investment (FDI) rose 9 percent Y-o-Y to $115.0 billion in 2011.
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