07:30 March Challenger Job Cuts
08:00 Brazil Feb Industrial Production
08:30 Initial Jobless Claims, Continuing Claims
10:00 March ISM Manufacturing, March ISM Prices Paid, Feb Construction Spending, Brazil March Trade Balance
10:30 Natural Gas Inventories
11:00 Treasury's 10-yr TIPS announcement, note announcement
Today’s Headlines
5:32:18 AM
(US) USDA announces 2010 US prospective plantings: To plant 88.8M corn acres (+2.7% y/y), to plant 78.1M soybean acres (+0.8% y/y); to plant 10.5M cotton acres (+15% y/y); to plant 53.8M all-wheat acres (-9% y/y)
- Corn Planted Acreage Up 3 Percent from 2009
- Soybean Acreage Up Less Than 1 Percent
- All Wheat Acreage Down 9 Percent
- All Cotton Acreage Up 15 Percent
7:30:04 AM
*DOE CRUDE: +2.9M V +2.4ME; GASOLINE:+315K V -1.8ME; DISTILLATE: -1.1M V -1.3ME; UTILIZATION: 82.6% V 81.3%E
- Distillate demand -165K bpd to 3.65M bpd
- Gasoline demand -30K bpd at 9.06M bpd
- 9th straight weekly build for Crude inventories
9:30:28 AM
(US) Fed's Lockhart: It is premature to assume tightening may occur imminently; inappropriate to place dates on 'extended period' language; could tighten before jobs rate is acceptable
- Guides Q1 GDP slightly below 3%
10:14:43 AM
(US) Fed's Lockhart: There will likely be a small impact from the end of the MBS program scheduled to end shortly - Q&A
- The private sector will enter the MBS market in the space vacated by the Fed
- Closely watching measures of inflation expectations
- Confident of sustained recovery and doesn't see a double dip in the economy
- Fed is watching the situation in Greece, not completely discounting the chances of contagion
10:18:21 AM
(CH) US Trade Rep's National Trade Estimate: China still maintains high bars to entry into banking, telecommunications and insurance industries, has significant non-tarriff barriers
- Agricultural imports face selective and unwarrented requirements.
- Mandatory labor unionization seems to specifically target Fortune 500 firms.
Please read our disclaimer:
Trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the markets. The videos are neither a solicitation nor an offer to Buy/Sell futures or options. The past performance of any trading system or methodology is not necessarily indicative of future results.
Rule 4.41 - Hypothetical or simulated performance results have certain limitations. Unlike an actual performance record, simulated results do not represent actual trading. Also, since the trades have not been executed, the results may have under-or-over compensated for the impact, if any, of certain market factors, such as lack of liquidity. Simulated trading programs in general are also subject to the fact that they are designed with the benefit of hindsight. No representation is being made that any account will or is likely to achieve profit or losses similar to those shown. Learn to trade futures forex stocks.
08:15 March ADP Employment Change
08:30 Canada Jan GDP
09:30 Brazil Feb Net Debt to GDP, Budget Balance
09:45 March Chicago PMI
10:00 Feb Factory Orders, March NAPM Milwaukee
10:30 DoE Crude Oil/Gasoline/Distillate Inventories
12:00 Colombia Feb Unemployment
Today’s Headlines
2:50:00 AM
(FR) Hearing vague chatter that sovereign ratings of France could be downgraded soon
- Moody's current rating at Aaa outlook stable
- S&P current rating at AAA outlook stable
- Fitch current rating at AAA outlook stable
5:00:29 AM
(PO) Bank of Portugal Spring Economic Bulletin: lowers GDP growth for 2010 and 2011
- Lowers 2010 GDP view to 0.4% from 0.7% prior view
- Lowers 2011 GDP view to 0.8% from 1.45 prior
- Notes that lower forecast comes from public spending cuts and a bigger-than-expected decline in business investment and construction spending.
5:30:03 AM
*(CA) CANADA FEB INDUSTRIAL PRODUCT PRICE M/M: 0.0% V 0.1%E; RAW MATERIAL PRICE INDEX M/M: 0.4% V -0.5%E
- Prior Industrial Product Price MoM revised from 0.3% to 0.4%
- Prior Raw Material Price Index MoM revised from 3.3% to 3.4%
7:33:10 AM
(BR) S&P analyst: No factors seen that would cause S&P to change sovereign debt ratings for Brazil
- highlights that if stable and sustainable growth levels continue, could prompt a rating action.
- sees no significant change in Brazil exchange rate over the next two years.
9:51:42 AM
(US) White House Advisor Volcker: Optimistic that the financial reform legislation will receive both House and Senate support, believes reform will get done in 2010
- Questions gains made in financial sector, as it sustained imbalances in economic growth.
- Core challenge of financial reform is tackling moral hazard that protects creditors, management and even stockholders.
- There is no economic need for commercial banks to be involved in proprietary trading, which conflicts with their fiduciary duties.
Please read our disclaimer:
Trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the markets. The videos are neither a solicitation nor an offer to Buy/Sell futures or options. The past performance of any trading system or methodology is not necessarily indicative of future results.
Rule 4.41 - Hypothetical or simulated performance results have certain limitations. Unlike an actual performance record, simulated results do not represent actual trading. Also, since the trades have not been executed, the results may have under-or-over compensated for the impact, if any, of certain market factors, such as lack of liquidity. Simulated trading programs in general are also subject to the fact that they are designed with the benefit of hindsight. No representation is being made that any account will or is likely to achieve profit or losses similar to those shown. Learn to trade futures forex stocks.
08:00 Chile Feb Unemployment, Industrial Production, Total Copper production
09:00 Feb S&P/CS Home Price Index, Feb S&P/CS Composite-20
10:00 March Consumer Confidence
16:30 API Crude Oil/Gasoline/Distillate Inventories
Today’s Headlines
3:29:27 AM
(GR) Moody's comments on Greece's structured finance deals, may achieve AAA ratings under certains conditions
- Moody's believes that Greek structured finance and covered bond transactions could achieve a Aaa rating subject to three main conditions.
3:30:28 AM
(GR) ECB's Nowotny: Collateral changes are not designed to help any single member of the Euro Zone
- Collateral changes should bring down spreads on Greek debt.
- Collateral changes would reduce dependence on sovereign ratings.
- Plan for cooperating with the IMF on Greece is "adequate," notes that cooperating with IMF must not impact ECB independence.
5:05:33 AM
(IN) US signs nuclear fuel reprocessing pact with India
- US and India have reached an agreement on reprocessing nuclear material, a key element of a landmark atomic energy pact, the State Department said Monday.
-The agreement permits India to reprocess spent nuclear fuel from the US. The deal removes the final roadblock to full implementation of a 2008 agreement.
5:30:02 AM
*(US) FEB PERSONAL INCOME: 0.0% V 0.1%E; PERSONAL SPENDING: 0.3% V 0.3%E
- Prior Personal Income revised higher from 0.1% to 0.3%
- Prior Personal Spending revised lower from 0.5% to 0.4%
6:07:53 AM
(GE) Preview: Germany Preliminary Mar CPI data expected at 9:15am ET (13:15 GMT)
**Consesnus Expectatiuons
- CPI MoM: 0.3%e v 0.4% prior; YoY: 0.9%e v 0.6% prior
- CPI EU Harmonized MoM: 0.3%e v 0.4% prior; YoY: 0.9%e v 0.5% prior
8:41:41 AM
(GR) Greece confirms final pricing of €5B in 7 year bonds at 310bps/swaps; coupon 5.9%
*** Reminder: On Mar 26th Financial Times reported that Greece would launch next multi billion Euro bond this week and that Greece was aiming to borrow approx €5B.
-This would be the first bond issue following the EU Summit reached an agreement for Greece's fiscal situation.
Please read our disclaimer:
Trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the markets. The videos are neither a solicitation nor an offer to Buy/Sell futures or options. The past performance of any trading system or methodology is not necessarily indicative of future results.
Rule 4.41 - Hypothetical or simulated performance results have certain limitations. Unlike an actual performance record, simulated results do not represent actual trading. Also, since the trades have not been executed, the results may have under-or-over compensated for the impact, if any, of certain market factors, such as lack of liquidity. Simulated trading programs in general are also subject to the fact that they are designed with the benefit of hindsight. No representation is being made that any account will or is likely to achieve profit or losses similar to those shown. Learn to trade futures forex stocks.
“When everyone is against you, it means that you are absolutely wrong-- or absolutely right.”
Market Week Wrap-up
- Equity indices gapped lower this week in the face of growing risk aversion, with traders disregarding robust corporate earnings and a strong first reading of US GDP. The Shanghai Composite dropped below 3,000 for the first time since late 2008, while the DJIA closed within 44 points of 10,000 and commodities traded off hard. On Friday, advance GDP showed the US economy grew faster than expected in Q4, at an annualized rate of 5.4%. If the GDP reading holds up upon revision, GDP in the final quarter of 2009 would be higher than at any time since September 2003. Housing data was mixed: the November S&P/CS index gained for the sixth consecutive month, although the move up was modest. Meanwhile, December new home sales fell nearly 8% m/m (following an 11% m/m decline in November), prompting Yale Economist Robert Shiller to reiterate that he believes home prices could be faltering yet again. President Obama gave his first State of the Union speech on Wednesday, offering a trenchant defense of his first year in office while also admitting certain mistakes had been made. The President promised to double US exports over the next five years and make job creation a primary focus, and also said $30B in repaid TARP funding would be redirect to loans for small businesses. Ahead of the speech, the Congressional Budget Office released predictions for a $1.35T deficit for this year as the economy continues to slowly recover from the recession. After a flurry of Washington drama last week (full of implicit threats to Fed policy independence), the Senate handed Ben Bernanke a second term as Fed chairman in a 70 to 30 vote. For the week, the DJIA lost 1.1%, the Nasdaq dropped 2.6% and the S&P 500 fell 1.7%.
- The DJIA and S&P500 pushed out to fresh 16-month highs this week as the first quarter lurched towards its close and volume sagged. With an underlying bid in equities appearing unwavering, markets have forced traders to be leery on the short side and pressured investors to keep putting cash to work, even in an atmosphere of dollar strength. Over in the European disunion, the Greek drama has come to what appears to be an intermission. German Chancellor Angela Merkel won a high-stakes game of poker with her Euro Zone colleagues, who have agreed to bring in some IMF funding to help fund a stand-by package for the Hellenic Republic. Another sovereign debt cliffhanger also seemed to resolve itself this week, as Dubai's government agreed to pump $9.5B into failing development group Dubai World, helping to further calm investors. Fed Chairman Bernanke once again reiterated that the US economy still needs accommodative policies and economic slack warrants low rates for an "extended period." In Washington, selected drug and hospital names benefitted from the final passage and signing of the health insurance despite numerous state AGs lawsuits, while members on both sides of the aisle engaged in escalating rhetoric with Chinese officials related to exchange rates and various other business topics. Note that Former Fed Chairman Alan Greenspan offered a warning on Federal deficits, stating that rising Treasury yields are "the canary in the coal mine" and that Federal debt is clearly influencing bonds. These comments came at the end of a week which saw the US 10-year yield rise some 20 basis points and trade back to the top of the range is has seen since the market collapse in late 2008. For the week, the DJIA gained 1%, the Nasdaq rose 0.9%, and the S&P500 climbed 0.6%.
- Selected financial stocks have risen sharply this week as the Obama Administration rolled out its latest plan for curtailing foreclosures in housing. The White House has been quietly negotiating with banks on the details of the program, which is focused on aiding homeowners with underwater mortgages, for some time. On Thursday the Treasury said the two-year plan would make it easier for the GSEs and other lenders to restructure mortgages and would look to restructure 2-3 million distressed mortgages, utilizing $50B in funds originally authorized under the TARP program. Bank of America announced that it would forgive loan principle of up to 30% on certain mortgages, although no other major banks have disclosed similar plans as of yet. At the end of 2009, there were about 11.3M US households that were underwater, about 24% of total US households. Citi, BoA and JP Morgan are up 5-10% this week. Meanwhile, shares of mortgage insurers have gained even more sharply, with PMI up 50%, RDN up 30% and MTG up nearly 20%.
- Notable moves were seen in the tech sector. Mobile handset chipset manufacturer Qualcomm raised its guidance for next quarter substantially on much improved revenue streams in licensing and chip businesses. Taiwanese smartphone name HTC said its earnings in the coming quarter would exceed expectations on robust demand for phones. Oracle's Q3 results and guidance came in a slightly above expectations and the firm's guidance was its strongest forecast in some time. Smaller tech names are also looking bright: Linux software firm Red Hat beat expectations on strong growth in subscription revenue, Integrated Silicon doubled its earnings guidance for next quarter thanks to growing DRAM demand and advantageous pricing and SSD hard drive specialist SMART Modular exceeded expectations and offered very strong guidance for next quarter.
- The news was mixed for the delicate US housing sector this week. US new home sales fell to their lowest level ever in February, while existing home sales data declined very slightly from January levels, in line with expectations. The NAR said that the bad weather in February may have masked underlying demand as closings were postponed by winter storms and buyers couldn't get out to look at homes in some areas. Homebuilder Lennar reported a smaller than expected quarterly loss in its Q1, while the losses at KB Homes were nearly twice the expected amount. KB's backlog is up sequentially, however, and its cancellation rate continues to fall. Note also that the Fed's Bullard commented that weakness in housing data makes him nervous in using asset sales as an tool when the Fed executes its exit policy.
- US Treasury markets opened on solid footing on Monday, with yields quietly drifting around the middle of a month long range. By Wednesday, however, concerns were swirling that rates were poised to move higher. Each the 2-yr and 5-year coupon auctions saw uninspiring bid-to-cover ratios accompanied by several basis point tails, fanning fears that the huge wave of government debt supply is beginning to affect Treasury prices. The auctions came in the wake of news out of interest rate swaps markets that investors were actually paying more for private sector debt than that backed by the US government. Throw in the impending end of the Fed's MBS purchases set for next week, increasing tensions between US and China on a host of economic/trade related issues, and a government that continues to debate and pass legislation predicated upon dramatic increases in spending in the face of ballooning deficits; the environment was ripe to push US yields up towards the loftiest levels seen since the darkest days of the financial crisis. The US benchmark 10-year gained 20 bps on the week and briefly traded above 3.9%. The 2-year ticked above 1.1% before backing off some 5 bps. The shape of the US curve didn't change much with as 10-2 spread still hovering around 280bp, but the spread between the German Bund continues to widen towards levels not seen since 2007 surpassing 70 bps.
- The week in currency trading began on a subdued note as European leaders continued to send out conflicting signals over aid to Greece ahead of Thursday's EU Summit. Tensions within the EMU were highlighted by comments from the Greek Deputy PM, who accused Germany of letting its banks to speculate against Greece in order to achieve a weaker euro (which aids German exports). The spread between the Greek 10-year bond and the corresponding German 10-year Bund jumped over 30 bps to test above 350bps ahead of the summit as concerns intensified that Greece might walk away from the summit empty handed. Intra-Euro Zone rhetoric hardened battle lines over how to proceed. Other peripheral debt concerns ballooned after Fitch cut Portugal's sovereign ratings on Wednesday. By mid-week the euro was ignoring better economic data to test 10-month lows against the dollar after German Chancellor Merkel appeared to triumph over other Euro Zone officials in her attempts to involve the IMF in the Greece rescue package. The ECB's position on the IMF appeared to go through a quick evolution: initially ECB rhetoric seemed to indicate the bank believed IMF involvement would be a troubling development for the euro. ECB Chief Trichet minced no words in stating that IMF aid for Greece would be "a very bad idea," but later backed away from this statement, saying he had been misunderstood. Later the ECB's Gonzalez-Paramo noted that IMF involvement does not conflict with Euro Zone rules and treaties. EUR/USD ended the week off its worst levels above 1.34.
- With the April 15th publication of the US Treasury's semi-annual currency report just around the corner the valuation of China's currency has been a hot subject this week. There has been growing political pressure to name China a "currency manipulator" in the report, and senior US senators Chuck Schumer (D-NY) and Lindsey Graham (R-SC) urged the Treasury to take this step. Schumer has threatened to have the Senate pass a bill to punish China for currency issue by May. The Chinese have reacted coolly to overheated comments out of the US. Chinese Vice Commerce Minister noted that China was willing to strengthen communication with the US over the valuation on the yuan and PBoC advisor Fan Gang warned that a stronger yuan would not help US employment and might undermine the US economic recovery. In another interesting development, Premier Wen said early in the week that China's March trade balance deficit might $8B in deficit, which would be China's first monthly trade deficit since April 2004 (note also that China's February trade surplus hit its lowest level since March 2007).
- The yen initially benefited from risk aversion and probed the 90 handle. However, sentiment soon turned against the JPY as dealers discussed press reports that Japanese insurance companies would increase dollar buying to invest in overseas bonds. Dealers also cited interest rates as a factor adding to the firm tone in USD/JPY. Meanwhile US 2-year rates moved back above the 1.08% level while the corresponding JGB yields were less than 0.2%. USD/JPY tested one-month highs above 92.70, then probed the key weekly pivot point of 92.30, which represents the current three-year downtrend line in the pair. Downward pressure on Japanese inflation continues to ease, as the February CPI data hit a nine-month highs. Speaking after inflation report, Japan's Finance Minister Kan called for additional measures to address deflation but also acknowledged slowing pace of declines and denied rumors of additional fiscal steps to support the economy.
- The main event for sterling was the initial presentation of plans for trimming the UK's FY11 budget. Early in the week GBP/USD managed to hold mostly above 1.50 but remained vulnerable ahead of the budget release following softer than expected inflation data for February. Following the release of the budget sterling tested two-week lows around 1.4870 following Chancellor Darling's budget speech. Although he highlighted that UK budget deficits would be smaller than previously forecasted (with an overall debt level nearly £100B smaller by 2013-14 than expectations in last year's budget), the comments failed to convince markets that Labour could improve the UK's dire fiscal situation. Major rating agencies will now review the budget to see if Britain's "AAA" ratings can be maintained. An EU deficit report stated that the economic assumptions in the document were a bit over optimistic.
- In Australia, RBA Deputy Governor Lowe forecasted additional hikes and warned that any delay in tightening could be costly. Regarding the AUD's prospects, Lowe said the currency over the next few years would remain above the average seen over the past decade. He urged the government monitor against a speculative housing cycle and calling for higher rates because of appreciation in the resource sector. Fixed-income markets were notably impressed with Lowe's bullishness, as OIS-derived expectations for early April RBA tightening rose about 10 points to near-60% chance. New Zealand's Q4 GDP registered its first increase since mid 2008. Speaking after the GDP report, NZ Finance Minister English said domestic economy is still facing challenges and has serious imbalances. The New Zealand Dollar continues outperform the aussie, with AUD/NZD reaching three-week lows around 1.2850.
- Several emerging market central bank decisions were also in focus. The South African Central Bank surprised the market with a 50bps rate cut while the Czech Central bank stated that its next move could be a cut after keeping its repo rate steady on Thursday. The Brazil Central bank stated outright that it has reached a consensus to raise rates at its next policy meeting.
Week of 3/29/2010 thru 4/2/2010
Monday, March 29, 2010
Economic
08:30 Feb Personal Income, Feb Personal Spending, Feb PCE Core
10:30 March Dallas Fed Manufacturing
Tuesday, March 30, 2010
Economic
08:00 Chile Feb Unemployment, Industrial Production, Total Copper production
09:00 Feb S&P/CS Home Price Index, Feb S&P/CS Composite-20
10:00 March Consumer Confidence
16:30 API Crude Oil/Gasoline/Distillate Inventories
Wednesday, March 31, 2010
Economic
08:15 March ADP Employment Change
08:30 Canada Jan GDP
09:30 Brazil Feb Net Debt to GDP, Budget Balance
09:45 March Chicago PMI
10:00 Feb Factory Orders, March NAPM Milwaukee
10:30 DoE Crude Oil/Gasoline/Distillate Inventories
12:00 Colombia Feb Unemployment
Thursday, April 01, 2010
Economic
07:30 March Challenger Job Cuts
08:00 Brazil Feb Industrial Production
08:30 Initial Jobless Claims, Continuing Claims
10:00 March ISM Manufacturing, March ISM Prices Paid, Feb Construction Spending, Brazil March Trade Balance
10:30 Natural Gas Inventories
11:00 Treasury's 10-yr TIPS announcement, note announcement
Friday, April 02, 2010
Economic
08:30 March Unemployment Rate, March Nonfarm Payrolls, March Manufacturing Payrolls, March Average Hourly Earnings
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Please read our disclaimer:
Trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the markets. The videos are neither a solicitation nor an offer to Buy/Sell futures or options. The past performance of any trading system or methodology is not necessarily indicative of future results.
Rule 4.41 - Hypothetical or simulated performance results have certain limitations. Unlike an actual performance record, simulated results do not represent actual trading. Also, since the trades have not been executed, the results may have under-or-over compensated for the impact, if any, of certain market factors, such as lack of liquidity. Simulated trading programs in general are also subject to the fact that they are designed with the benefit of hindsight. No representation is being made that any account will or is likely to achieve profit or losses similar to those shown. Learn to trade futures forex stocks.
08:30 Final Q4 GDP, Q4 GDP Price Index, Q4 Personal Consumption, Q4 Core PCE
09:55 March Final University of Michigan Confidence
15:00 Argentina Jan Economic Activity Index
Today’s Headlines
4:32:34 AM
(BR) Brazil Central Bank (COPOM) Monetary Policy Meeting: Consensus reached to raise interest rates at next meeting
- CPI dynamics have deteriorated since the last meeting.
- 2010 and 2011 inflation outlook markedly above the midpoint of the central bank target.
- COPOM agrees on the need to raise interest rates.
5:00:57 AM
(EU) ECB's Wellink: Sees risk of "W" shape global recovery
- Loose monetary policies might fuel new instabilities; Timely exit from special measures remains key
- Return to normal rates inevitable in the long term
- Supports possible IMF standby facility for Greece
- Not clear if the Greece fiscal situation is isolated
5:30:03 AM
*(US) INITIAL JOBLESS CLAIMS: 442K V 450KE; CONTINUING CLAIMS: 4.65M V 4.562ME
- Prior Initial Claims revised lower from 457K to 456K
- Prior Continuing Claims revised higher from 4.579M to 4.70M
6:02:10 AM
(SA) South Africa Central bank Gov Marcus: Inflation forecast has improved, inflation expectations are well anchored
- Demand side of economy currently does not present upside risks to inflation.
- Credit conditions remain a constraint.
- Unemployment trends appear to be flattening; employment to lag economic recovery.
- Tight credit conditions are constraining spending.
7:00:20 AM
(US) Fed Chairman Bernanke: Economy still needs accomodative policies; economic slack warrants low rates - testimony similar to Feb 10 release
- Fed has proper tools to withdraw stimulus
- reiterates discount rate increase does not signal broader tightening
- reiterates rates should remain low for extended period
8:03:03 AM
(US) Fed's Bernanke: Reiterates there are no plans to monetize the debt; have not been doing so
- If inflation expectations change, the Fed will act appropriately. Looks at both inflation numbers and inflation expectations when determining rates.
- May sell assets in a gradual and predictable way at some point in time; affirms MBS program to end in March.
Please read our disclaimer:
Trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the markets. The videos are neither a solicitation nor an offer to Buy/Sell futures or options. The past performance of any trading system or methodology is not necessarily indicative of future results.
Rule 4.41 - Hypothetical or simulated performance results have certain limitations. Unlike an actual performance record, simulated results do not represent actual trading. Also, since the trades have not been executed, the results may have under-or-over compensated for the impact, if any, of certain market factors, such as lack of liquidity. Simulated trading programs in general are also subject to the fact that they are designed with the benefit of hindsight. No representation is being made that any account will or is likely to achieve profit or losses similar to those shown. Learn to trade futures forex stocks.
08:00 Brazil Feb Unemployment Rate
08:30 Initial Jobless Claims, Continuing Claims
10:30 Natural Gas Inventories
11:00 Mexico Feb Unemployment Rate
12:00 Colombia Q4 GDP
12:30 UK 2011 Budget Proposal
13:00 Treasury's $32B 7-yr note auction
Today’s Headlines
6:25:54 AM
(SP) ECB's Ordonez: Spain needs major reforms in order to return to growth, Spain's high deficit might undermine its economic recovery
- Higher deficits raise borrowing costs.
- Spain needs to strictly adhere to deficit cuts.
- Spanish families and companies need to rebuild balance sheets first before consumption and investment can recover.
7:00:01 AM
*(US) FEB NEW HOME SALES: 308K V 315KE (-2.2% M/M) (308K is lowest on record)
- prior revised higher from 309K to 315K
7:45:19 AM
(US) Fed's Hoenig: Endorses Volcker rule; US must encourage competition
- Expects credit growth to begin coming back slowly
- Sees a improvement of regulation may come with the reversal of some prior deregulation
- Feels financial holding companies should not engage in propo trading or handling hedge funds
- In favor of some basic supervisoy techniques that deal with maximum leverage levels and loan to value
7:48:15 AM
(SZ) SNB Vice Chairman Jordan: Banking collapse must not threaten financial system in the future, Swiss banking sector is overly large in proportion to Swiss economy
- No bank should be considered too big to fail in the future.
- Swiss banks will likely fight implementation of drastic measures.
- Switzerland may need more rigorous bank regulation than other countries
8:54:16 AM
Fed's Hoenig: Have no idea when rates should rise; will depend on economy and data - TV interview
- affirms 2010 GDP expectation at 3%.
- if US can show consistent growth at 3%, it would move Fed towards thinking about rate hikes.
- need to focus on leading indicators, if you wait for all the lagging indicators (such as employment data) to be perfect, 'you've waited too long.'
10:01:44 AM
*(US)TREASURY'S $42B 5-YEAR NOTE AUCTION DRAWS 2.605%; BID-TO-COVER RATIO: 2.55 V 2.75 PRIOR AND 2.53 AVG OVER THE LAST 10 AUCTIONS
- indirect bidders take 39.7% of competitive bids with 29.97% allotted at the high.
- direct bidders take 10.79%, primary dealers 49.6%.
- median 2.539%, low 2.450%.
Please read our disclaimer:
Trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the markets. The videos are neither a solicitation nor an offer to Buy/Sell futures or options. The past performance of any trading system or methodology is not necessarily indicative of future results.
Rule 4.41 - Hypothetical or simulated performance results have certain limitations. Unlike an actual performance record, simulated results do not represent actual trading. Also, since the trades have not been executed, the results may have under-or-over compensated for the impact, if any, of certain market factors, such as lack of liquidity. Simulated trading programs in general are also subject to the fact that they are designed with the benefit of hindsight. No representation is being made that any account will or is likely to achieve profit or losses similar to those shown. Learn to trade futures forex stocks.
08:30 Feb Durable Goods Orders
10:00 Feb New Home Sales
10:30 DoE Crude Oil/Gasoline/Distillate Inventories
11:00 Mexico Feb Trade Balance
13:00 Treasury's $42B 5-yr note auction
Today’s Headlines
3:46:02 AM
(EU) ECB's Constancio: There is no need for eurobonds in sovereign debt crisis; believes eurobonds would violate EU treaties
- Not in favor of sending Greece to IMF, as this would hurt the euro.
- Against totally banning naked short selling of CDS, which would totally kill the market for CDS.
- Monetary policy should not be used to maintain exchange rates at a certain level
- Bilateral loans to Greece is possible if necessary
- Open to idea of European Monetary Fund (EMF)
- Greek measures are convincing
4:00:06 AM
(UK) MAR CBI DISTRIBUTIVE TRADES: +13 V +23 PRIOR
-Components:
- Order Volume Balance: +7 v +12 prior
- Volume of Underlying Sales: +9 v +9 prior
- Expected Sales Balance: +14 v +16 prior
4:02:47 AM
(UK) BoE: Publishes long-term repo proposal paper, would offer long-term repos once a month under new framework
- Plans to conduct two three-month operations, one smaller six-month operation each quarter and offer £total 15B
- Would consult on the plans until mid-April, then would conduct training in May with a view to implementing the new framework later this year
6:31:46 AM
*(BR) BRAZIL FEB TOTAL OUTSTANDING LOANS (BRL): 1.44T V 1.42T PRIOR; PRIVATE BANK LENDING: 833M V 828B PRIOR
- Prior Private bank Lending revised from 827B to 828B
- Central Bank Feb default rate at 5.3% v 5.5% prior month (Jan)
7:00:03 AM
*(US) FEB EXISTING HOME SALES: 5.02M V 5.0ME (-0.6% M/M)
- No revisions
- Median existing home price $165.1K v $164.9K (revised from $164.7K) in Jan (+0.1% m/m); vs $168.5K (-2.1%) y/y
- Total Months Supply: 8.6 v 7.8 months in Jan
- Distressed sales: 35% v 38% in Jan
Please read our disclaimer:
Trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the markets. The videos are neither a solicitation nor an offer to Buy/Sell futures or options. The past performance of any trading system or methodology is not necessarily indicative of future results.
Rule 4.41 - Hypothetical or simulated performance results have certain limitations. Unlike an actual performance record, simulated results do not represent actual trading. Also, since the trades have not been executed, the results may have under-or-over compensated for the impact, if any, of certain market factors, such as lack of liquidity. Simulated trading programs in general are also subject to the fact that they are designed with the benefit of hindsight. No representation is being made that any account will or is likely to achieve profit or losses similar to those shown. Learn to trade futures forex stocks.
March 22, 2010
20 Ticks LIVE Today; Currencies Webinar Tues 530pm EST Dont miss it!
08:30 Canada Feb Leading Indicators
10:00 March Richmond Fed Manufacturing, Feb Existing Home Sales, Jan House Price Index
13:00 Treasury's $44B 2-yr note auction
15:00 Argentina Feb Trade Balance
16:30 API Crude Oil/Gasoline/Distillate Inventories
Today’s Headlines
2:55:29 AM
World Steel Association: Feb global steel output at 108M tons v 109M tons m/m (+24.2% y/y)
- Chinas crude steel production for February 2010 was 50.4 mmt, an increase of 22.5% on February 2009
- World crude steel capacity utilisation ratio for the 66 countries in February 2010 was 79.8%, a 15-month high since September 2008. Compared to February 2009, the utilisation ratio in February 2010 increased by 12.0 percentage points
3:02:16 AM
(SZ) SNB Quarterly Update: Economic recovery continued in Q1 but outlook remains fragile
- Cautiously optimistic over the next six months
- Reiterates that it would act decisively to prevent excessive CHF appreciation in EUR/CHF cross
4:00:43 AM
(GE) German Bundesbank Monthly report: German economic recovery to resume in Q2
- IMF should not finance countries' public deficits as it is not in line with IMF mandate
- Not in favor of one seat for EU at IMF as it might reduce influence
5:05:19 AM
(US) Fed's Bullard: The "extended period" language is putting the Fed in a box - CNBC intervew
- Do not want to convey uncertainty to markets over timing of tightening.
- Wants economic performance to dictate rate moves.
- Revealing discount window borrowers could be dangerous.
6:31:03 AM
(BR) BRAZIL FEB CURRENT ACCOUNT -$3.3B v -$2.0BE; FOREIGN INVESTMENT: $2.8B V $2.7BE
- Revises 2010 current account forecast to -$49B from -$40B.
- Followup: Brazil Central Bank revises 2010 Trade Surplus of $10B v $15B prior; Imports seen at $163B v $155B prior and Exports at $173B v $170B prior
- Forecasts Current Account deficit to GDP ratio at 2.5%
Please read our disclaimer:
Trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the markets. The videos are neither a solicitation nor an offer to Buy/Sell futures or options. The past performance of any trading system or methodology is not necessarily indicative of future results.
Rule 4.41 - Hypothetical or simulated performance results have certain limitations. Unlike an actual performance record, simulated results do not represent actual trading. Also, since the trades have not been executed, the results may have under-or-over compensated for the impact, if any, of certain market factors, such as lack of liquidity. Simulated trading programs in general are also subject to the fact that they are designed with the benefit of hindsight. No representation is being made that any account will or is likely to achieve profit or losses similar to those shown. Learn to trade futures forex stocks.
“There is no safety in numbers, or in anything else.”
Market Week Wrap-up
- Equity indices gapped lower this week in the face of growing risk aversion, with traders disregarding robust corporate earnings and a strong first reading of US GDP. The Shanghai Composite dropped below 3,000 for the first time since late 2008, while the DJIA closed within 44 points of 10,000 and commodities traded off hard. On Friday, advance GDP showed the US economy grew faster than expected in Q4, at an annualized rate of 5.4%. If the GDP reading holds up upon revision, GDP in the final quarter of 2009 would be higher than at any time since September 2003. Housing data was mixed: the November S&P/CS index gained for the sixth consecutive month, although the move up was modest. Meanwhile, December new home sales fell nearly 8% m/m (following an 11% m/m decline in November), prompting Yale Economist Robert Shiller to reiterate that he believes home prices could be faltering yet again. President Obama gave his first State of the Union speech on Wednesday, offering a trenchant defense of his first year in office while also admitting certain mistakes had been made. The President promised to double US exports over the next five years and make job creation a primary focus, and also said $30B in repaid TARP funding would be redirect to loans for small businesses. Ahead of the speech, the Congressional Budget Office released predictions for a $1.35T deficit for this year as the economy continues to slowly recover from the recession. After a flurry of Washington drama last week (full of implicit threats to Fed policy independence), the Senate handed Ben Bernanke a second term as Fed chairman in a 70 to 30 vote. For the week, the DJIA lost 1.1%, the Nasdaq dropped 2.6% and the S&P 500 fell 1.7%.
- Equity markets sustained their gradual upward trajectory this week, with the S&P500 and DJIA joining the Nasdaq at new 16-month highs, as traders were transfixed by finance and healthcare legislative dramas in Washington. The fate of the healthcare reform bill hung in the balance all week as the Democrats desperately tried to corral the simple majority they need to pass the final package in the House. The final House vote is expected on Sunday, with a final Senate vote seen early next week. Passage seems likely, although it appears to be far from a sure bet as of Friday evening. Meanwhile, policy meetings at the FOMC and the Bank of Japan left rates alone, most data was comfortably in line with expectations and at its Spring conference OPEC kept its output quotas unchanged for the fifth consecutive time. On Thursday, rumors of a second intra-meeting hike in the Fed discount rate made the rounds, prompting the Fed to issue a "no comment," but ultimately no discount rate action ensued. Among economic reports, the headline February PPI number showed its biggest decline since last July, prompting more deflation jitters. Stocks and commodities traded off somewhat on Friday when India surprised investors with a rate hike just after the US equity market open, driving a sudden wave of risk aversion (volatility in stocks was accentuated on Friday by quadruple witching). A down day on Friday broke an eight day win streak for the DJIA, but for the week, the DJIA still gained 1.1%, the Nasdaq rose 0.3%, and the S&P500 climbed 0.9%.
- Senator Dodd outlined his proposal for financial regulation reform on Monday. Dodd's bill would create an independent consumer agency within the Federal Reserve, require hedge funds with over $100M in assets to register with the Fed and force trading in certain derivative onto public exchanges. In an attempt to end the "too big to fail" problem, the bill would restrain the Fed's ability to bail out failing firms and require approval of three bankruptcy judges within 24 hours to liquidate a large firm. The Volcker Rule, restricting proprietary trading by banks, is part of the package. Republican members of the Senate Banking Committee have been surprisingly receptive to the measures after condemning Dodd just last week for unveiling the bill before it was totally complete. The major sticking point is apparently over regulating certain derivative contracts, which were at the heart of the financial crisis. Fed Chairman Bernanke told Congress that he is concerned about provisions that would limit the size of the banks regulated by the Fed, saying the Fed should have oversight over smaller banks. Former Fed Chairman Greenspan commented that increasing capital requirements for banks would be more effective than the new financial reform legislation. Dodd's committee will begin markup of the bill starting next Monday.
- There continues to be a susurrus of takeover rumors in circulation, including talk of private equity offers for Harley Davidson and Beazer Homes making the rounds. Teva signed a deal to acquire German drug maker Ratiopharm for €3.63B, further securing its position as the world's number one generic drug maker. Teva, which beat rival bids from Pfizer and Iceland's Actavis, said the combined company would have had 2009 revenues of more than $16B, up from Teva's own sales of around $14B. Phillips-Van Heusen said it would acquire Tommy Hilfiger from buyout shop Apax Partners in a cash-and-stock deal valued at about $3B. The combined company's revenue will total about $4.6B and allow PVH to introduce its brands in international markets. In other ongoing merger stories, BJ Services and Baker Hughes said the DoJ has raised some concerns about their pending merger deal. OSI Pharmaceuticals rejected Astellas' unsolicited tender offer for $52/share cash, stating that the offer substantially undervalues OSI.
- The TARP was back in headlines this week as three major firms, including Comerica, Hartford Financial and Discover Financial Services, signed deals to pay back their government funds. Discover surprised investors with a sizable quarterly loss, versus expectations of solid profitability. Discover's delinquency rates are improving, however its provision for loan losses continues to grow. In addition, Discover said the Treasury has approved its request to pay back TARP funds. HIG announced it would offer $1.45B of common stock and $500M of convertible preferred stock to pay back the TARP, and CMA said it redeemed the $2.25B of preferred stock issued to the U.S. Department of the Treasury.
- In tech, there were reports that Google would formally announce its withdrawal from the Chinese market next week, setting off a debate among industry watchers about which firms would most benefit from the move. Additionally, the London Independent reported that Facebook overtook Google as the most popular site in the US for the first time, based on data from Hitwise. Apple is reportedly encountering some difficulty getting media companies to provide content for its forthcoming iPad product; the tablet computer is scheduled to launch April 3rd. In earnings, Palm's quarterly losses was higher than expected as the smart phone maker's business continues to be hammered by the competition. Palm's CFO said he see next quarter's revenue at half the expected amount due to a "significant decline" in orders for its Pre and Pixi smart phones and building inventories caused by insufficient training of retailers' staff.
- The FOMC meeting, not surprisingly, was the main focus of Treasury market coming into the week. Prices rallied and yields dropped after the Fed left rates unchanged and indicated they were still months away from considering moving the funds rate. Fed fund futures even ticked a little higher initially, indicating slightly lower expectations the Fed will move at the end of this year, but better demand was primarily seen at the long end of the curve. Thursday's announcement the Treasury would be auctioning off another $108B in new short term paper this coming week returned focus to the government's historical borrowing needs. Also rumors that the Fed was considering another unscheduled hike in the discount rate helped reversed some bullish sentiment. The 2-year yield is stubbornly holding within striking distance of 1% while better demand has kept a lid on the 10 and 30-year yields. By Friday the spread between the 2 and 10-year narrowed to less than 270 basis points for the first time since late last year.
- FX traders shifted focus away from European peripherals and toward the FOMC and BOJ central bank meetings early on this week. But the Greek tragedy refused to leave the stage, and the euro continued to suffer from more EU discord over how to help Greece get out of its debt hole. EU Finance Ministers provided a strategy for emergency "standby" loans in case Greece's €4.8B austerity measures failed to bring the country's budget deficit back into line with Maastrict Stability Pact criteria. The ratings agencies were out once again with commentary on the stability of US and UK sovereign ratings. Moody's said the US's Aaa rating would see pressure from the budget's 10-yr projections and noted that higher Gilt yields could test the UK's "Aaa" sovereign status over time. Moody's also said that whichever party emerges the winner from upcoming UK elections would take appropriate action on the deficit, even if there is a hung parliament. US TIC data released on Monday provided some ammunition for dollar bears as Chinese holdings of US Treasuries declined for the third straight month.
- Greece submitted a progress report on its €4.8B deficit cutting plan to the EU. The rating agencies seem pleased with Greece's progress so far. On Tuesday S&P took Greece off its credit watch negative list and affirmed the country's BBB+ sovereign rating. At their meeting this week, European finance minters discussed the proposed European Monetary Fund (EMF), while France and Germany exchanged barbs over how best to handle the problem. The Greeks mainly wants lower borrowing costs now that they feel they've taken appropriate steps and appear to be threatening to go to the IMF for aid (the feeling is that this would embarrass the Euro Zone). Traders are now focusing on the EU Summit scheduled for March 25th.
- The hot-button Chinese currency issue hit a fever pitch this week ahead of next month's semi-annual US Treasury report that could see China formally labeled a currency manipulator. Bipartisan support quickly fell in behind Senator Schumer, who said he would reintroduce legislation to confront China on currency late last week. A group of 130 members of the House sent a letter to Treasury Secretary Geithner urging him to name China a currency manipulator. The Treasury response was measured, calling the currency concerns significant and warranting review of Senate proposal, though Geithner told one interview the Treasury does not believe China is a currency manipulator. The IMF's Strauss-Kahn also chimed in on the debate, suggesting the Yuan is "much undervalued." Later in the week, China Commerce Ministry called US currency demands unfair and harmful to China-US trade concerns, echoing weekend commentary from Premier Wen rejecting the notion that renminbi is undervalued. Conflicting opinions were heard from other quarters: Morgan Stanley's Steven Roach said calls for a strong yuan is "very bad advice," while noted US Economist Joseph Stiglitz said yuan appreciation would not fully resolve trade imbalances and could affect China's demand for US Treasuries.
- All in all the euro maintained its now familiar range of 1.34 to 1.38 but saw bearish momentum from the Greek situation. The currency hit 17-month lows against the Swiss Franc at 1.4315 (just above the all-time low made back in Oct 2008 at 1.4297) after the SNB newest member Danthine said exchange rates should be guided by market forces, seeming to go against the SNB's well established policy of fighting CHF appreciation. After the currency reacted sharply, he later added that the standard SNB statement that the central bank will continue to fight excessive Franc strength
- Sterling price action continued to reflect political uncertainties, setting out on a soft tone as the latest election polls continued to point toward a hung parliament. Comments from BoE's Barker about a possible negative GDP reading also weighed on the early sentiment. Overextended bearish technicals coupled with the largest monthly decline in the jobless claimant count since Nov 1997 provided the basis for a rebound above 1.5350 before drifting back to probe the mid 1.51 area.
- The Bank of Japan yielded to political pressure to address deflation with new easing measures by expanding its 3-month 0.1% funding operation to ¥20T from ¥10T, but failed to impress the markets, which had expected either a 6-month lending expansion or an increase in monthly JGB purchasing. Instead, the BoJ left its JGB buying unchanged at ¥1.8T and pointed to a moderating trend in deflationary pressure. Governor Shirakawa further downplayed the measure by calling it a part of monetary policy rather than quantitative easing, also suggesting market operations alone will not increase economic activity. In turn, Japan Government Spokesperson Hirano said the cabinet welcomes the BoJ's doubling of its lending program, reiterating the need for the government and central bank to cooperate in fighting deflation.
Week of 3/22/2010 thru 3/26/2010
Monday, March 22, 2010
Economic
10:00 Feb Chicago Fed Activity
Tuesday, March 23, 2010
Economic
08:30 Canada Feb Leading Indicators
10:00 March Richmond Fed Manufacturing, Feb Existing Home Sales, Jan House Price Index
13:00 Treasury's $44B 2-yr note auction
15:00 Argentina Feb Trade Balance
16:30 API Crude Oil/Gasoline/Distillate Inventories
Wednesday, March 24, 2010
Economic
08:30 Feb Durable Goods Orders, Feb New Home Sales
10:30 DoE Crude Oil/Gasoline/Distillate Inventories
11:00 Mexico Feb Trade Balance
13:00 Treasury's $42B 5-yr note auction
Thursday, March 25, 2010
Economic
08:00 Brazil Feb Unemployment Rate
08:30 Initial Jobless Claims, Continuing Claims
10:30 Natural Gas Inventories
11:00 Mexico Feb Unemployment Rate
12:00 Colombia Q4 GDP
13:00 Treasury's $32B 7-yr note auction
Friday, March 26, 2010
Economic
08:30 Final Q4 GDP, Q4 GDP Price Index, Q4 Personal Consumption, Q4 Core PCE
09:55 March Final University of Michigan Confidence
15:00 Argentina Jan Economic Activity Index
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Please read our disclaimer:
Trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the markets. The videos are neither a solicitation nor an offer to Buy/Sell futures or options. The past performance of any trading system or methodology is not necessarily indicative of future results.
Rule 4.41 - Hypothetical or simulated performance results have certain limitations. Unlike an actual performance record, simulated results do not represent actual trading. Also, since the trades have not been executed, the results may have under-or-over compensated for the impact, if any, of certain market factors, such as lack of liquidity. Simulated trading programs in general are also subject to the fact that they are designed with the benefit of hindsight. No representation is being made that any account will or is likely to achieve profit or losses similar to those shown. Learn to trade futures forex stocks.
07:00 Canada Feb CPI, Jan Retail Sales
11:00 Mexico rate decision
15:00 Argentina Q4 GDP, Industrial Production
Today’s Headlines
4:00:05 AM
*(UK) MAR INDUSTRIAL TRENDS TOTAL ORDERS: -37 V -36 PRIOR
- Avg expected prices (Industrial Output Balance) +17% v +8% prior
- Expected Output Volume: +5% v +7%
- Export Orders: -18% v -23%
4:14:27 AM
(GR) Greece Fin Min: Denies earlier press speculation that Greece could ask IMF for aid in early April
***Reminder: Before the European morning an unnamed Greece Official commented that Greece sight IMF aid during April 2-4 Easter weekend and was in steady contact with IMF Chief Strauss-Kahn. The official noted of a growing rift with Germany over the debt crisis was deepening (sse our 00:54am ET headline)
8:40:53 AM
(US) Hearing rumor of Fed plans for a discount rate increase
***Note that a few weeks after the Jan 27 FOMC meeting, on Feb 18 the Fed raised the Discount rate 25 bps to 0.75%, but couched it as a move toward "normalization" that does not reflect a change in policy outlook.
9:37:01 AM
(US) Congressional aide highlights health care legislation to include 3.8% tax on unearned income
- Note: In Feb Obama proposed a health care reform bill that included a 2.9% tax on unearned income
10:08:09 AM
(TU) Turkey central bank leaves base rate at 6.50%, as expected
- reiterates interest rates must stay low for a long time
- expects inflation to remain below target rate
10:00:40 AM
(SZ) SNB's Danthine: Generous monetary policy cannot go on forever, economy needs to prepare for rate hikes; Swiss economic outlook is very favorable
- Says exchange rates should be guided by market forces.
- SNB has the toolbox it needs to exit tight monetary policy.
- Fear of deflation is receding but is not gone.
**note: Danthine is the newest member of the SNB board, having joined in January.
Please read our disclaimer:
Trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the markets. The videos are neither a solicitation nor an offer to Buy/Sell futures or options. The past performance of any trading system or methodology is not necessarily indicative of future results.
Rule 4.41 - Hypothetical or simulated performance results have certain limitations. Unlike an actual performance record, simulated results do not represent actual trading. Also, since the trades have not been executed, the results may have under-or-over compensated for the impact, if any, of certain market factors, such as lack of liquidity. Simulated trading programs in general are also subject to the fact that they are designed with the benefit of hindsight. No representation is being made that any account will or is likely to achieve profit or losses similar to those shown. Learn to trade futures forex stocks.
07:00 Canada Feb CPI, Jan Retail Sales
11:00 Mexico rate decision
15:00 Argentina Q4 GDP, Industrial Production
Today’s Headlines
4:00:05 AM
*(UK) MAR INDUSTRIAL TRENDS TOTAL ORDERS: -37 V -36 PRIOR
- Avg expected prices (Industrial Output Balance) +17% v +8% prior
- Expected Output Volume: +5% v +7%
- Export Orders: -18% v -23%
4:14:27 AM
(GR) Greece Fin Min: Denies earlier press speculation that Greece could ask IMF for aid in early April
***Reminder: Before the European morning an unnamed Greece Official commented that Greece sight IMF aid during April 2-4 Easter weekend and was in steady contact with IMF Chief Strauss-Kahn. The official noted of a growing rift with Germany over the debt crisis was deepening (sse our 00:54am ET headline)
8:40:53 AM
(US) Hearing rumor of Fed plans for a discount rate increase
***Note that a few weeks after the Jan 27 FOMC meeting, on Feb 18 the Fed raised the Discount rate 25 bps to 0.75%, but couched it as a move toward "normalization" that does not reflect a change in policy outlook.
9:37:01 AM
(US) Congressional aide highlights health care legislation to include 3.8% tax on unearned income
- Note: In Feb Obama proposed a health care reform bill that included a 2.9% tax on unearned income
10:08:09 AM
(TU) Turkey central bank leaves base rate at 6.50%, as expected
- reiterates interest rates must stay low for a long time
- expects inflation to remain below target rate
10:00:40 AM
(SZ) SNB's Danthine: Generous monetary policy cannot go on forever, economy needs to prepare for rate hikes; Swiss economic outlook is very favorable
- Says exchange rates should be guided by market forces.
- SNB has the toolbox it needs to exit tight monetary policy.
- Fear of deflation is receding but is not gone.
**note: Danthine is the newest member of the SNB board, having joined in January.
Please read our disclaimer:
Trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the markets. The videos are neither a solicitation nor an offer to Buy/Sell futures or options. The past performance of any trading system or methodology is not necessarily indicative of future results.
Rule 4.41 - Hypothetical or simulated performance results have certain limitations. Unlike an actual performance record, simulated results do not represent actual trading. Also, since the trades have not been executed, the results may have under-or-over compensated for the impact, if any, of certain market factors, such as lack of liquidity. Simulated trading programs in general are also subject to the fact that they are designed with the benefit of hindsight. No representation is being made that any account will or is likely to achieve profit or losses similar to those shown. Learn to trade futures forex stocks.
08:30 Feb CPI, Feb CPI Ex Food & Energy, Feb CPI Core Index SA, Q4 Current Account Balance, Initial Jobless Claims
10:00 Feb Leading Indicators, March Philadelphia Fed
10:30 Natural Gas Inventories
11:00 Treasury note announcement
17:00 Colombia Jan Industrial Production, Retail Sales
18:00 Chile rate decision
Today’s Headlines
4:00:11 AM
OPEC Sec General El-Badri: Leaves quotas unchanged; Next meeting to be in mid-October in Vienna (all as expected)
- Urged better compliance levels within OPEC
- Agreed to roll over quota figures
3:45:59 AM
(EU) EU Commission comments on 14 Euopean govt economic assumptions: Noted that many govt growth and deficit assumptions are "overly optimistic"; Sees 'ambitious deficit cuts in 2011
- Calls on UK to strengthen pace of fiscal consolidation.
- Believes that UK deficit program will not meet 2015/14 goal and needs to act more quickly
6:00:50 AM
(HU) Hungary Central Bank minutes: Voted 6 to 3 to lower rates by 25bps; easing cycle could end at any time
- Expects to meet CPI target by mid 2010
- Rate cuts hinge on risk assessment; CPI and GDP might allow lower interest rates
- Greece fiscal situation could increase uncertainty
6:13:52 AM
(GE) German Gov't: EU treaties do not allow bailouts; Sees no decision on Greece at next week EU Summit
- Reiterates that Greece has not asked for aid
- Greece has a good chance to solve its own fiscal situation and trust that it can refinance its debt
5:30:02 AM
*(US) FEB PRODUCER PRICE INDEX M/M: -0.6% V -0.2%E; PPI EX FOOD&ENERGY: 0.1% V 0.1%E
- PPI YoY: 4.4% v 4.9%e
- PPI Ex Food & Energy YoY: 1.0% v 1.0%e
- Headline largest drop since July, 2009.
Please read our disclaimer:
Trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the markets. The videos are neither a solicitation nor an offer to Buy/Sell futures or options. The past performance of any trading system or methodology is not necessarily indicative of future results.
Rule 4.41 - Hypothetical or simulated performance results have certain limitations. Unlike an actual performance record, simulated results do not represent actual trading. Also, since the trades have not been executed, the results may have under-or-over compensated for the impact, if any, of certain market factors, such as lack of liquidity. Simulated trading programs in general are also subject to the fact that they are designed with the benefit of hindsight. No representation is being made that any account will or is likely to achieve profit or losses similar to those shown. Learn to trade futures forex stocks.
08:30 Feb PPI, Feb Feb PPI Ex Food & Energy
10:30 DoE Crude Oil/Gasoline/Distillate Inventories
Today’s Headlines
3:03:15 AM
(GE) ZEW's Franz: German recovery still far from full recovery
- Says business activity has moved from intensive car to rehab
- Interest rate expectations are largely unchanged
4:39:19 AM
(GR) Greece Fin Min: Greek austerity plan ahead of schedule
- Euro Group decision on committment to Greece is very important
- Lower borrowing costs would help euro currency stability
- European Monetary Fund worthy of debate and would be a medium term concept
- No comment on planned bond issues as market remains volatle
5:29:48 AM
(UA) UAE Oil Min: Oil prices are disconnected to basic supply and demand fundamentals; Oil markets may see demand decline in Q2 2020
- Oil prices fluctuations are connected to movements in USD and global economic indicators
- Current fundamentals in oil markets do not make case for changes to OPEC quota targets
5:31:35 AM
*(US) FEB HOUSING STARTS: 575K V 570KE; BUILDING PERMITS: 612K V 601KE
- Prior Housing Starts revised higher from 591K to 611K
- Prior Building Permits revised higher from 621K to 622K
8:16:03 AM
(SP) Moody's discusses sovereign ratings: Spains' AAA rating is 'well placed'; France's AAA rating is "comfortable"
- notes French and German ratings are under less pressure than US and UK ratings, but US and UK are not likely to lose their Aaa ratings (similar to comments on 3/14)
Please read our disclaimer:
Trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the markets. The videos are neither a solicitation nor an offer to Buy/Sell futures or options. The past performance of any trading system or methodology is not necessarily indicative of future results.
Rule 4.41 - Hypothetical or simulated performance results have certain limitations. Unlike an actual performance record, simulated results do not represent actual trading. Also, since the trades have not been executed, the results may have under-or-over compensated for the impact, if any, of certain market factors, such as lack of liquidity. Simulated trading programs in general are also subject to the fact that they are designed with the benefit of hindsight. No representation is being made that any account will or is likely to achieve profit or losses similar to those shown. Learn to trade futures forex stocks.
08:30 Feb Import Price Index, Feb Housing Starts, Feb Building Permits, Canada Jan Wholesale Sales
14:15 FOMC rate decision
16:30 API Crude Oil/Gasoline/Distillate Inventories
17:00 Colombia Jan Trade Balance
Today’s Headlines
4:25:40 AM
(EU) ECB's Gonzalez-Paramo: Fiscal policy should be more tightly coordinated and rules strengthened
- Open to any proposal that would asist in credibility.
- Says risk control just as important as collateral
- Sees inflation just above 1% in 2010 and near ECB's target of 2.0% in 2011
- Reiterates that ECB interest rates are appropriate.
- Exit from liquidity measures should be gradual so as not to surprise markets.
5:19:49 AM
(GE) German BDB Banking Association: Remain cautious on 2010 sector outlook
- Banks not seen reaching 2007/08 operating levels until 2013/14
5:30:03 AM
*(US) MAR EMPIRE MANUFACTURING: 22.9 V 22.0E
- No revisons
Feb Components:
- Prices Paid: 29.6 v 31.9 prior
- New Orders: 25.4 v 8.8 prior (best since October, 2009)
- Employment: 12.4 v 5.6 prior
6:37:20 AM
(LB) Libya Oil Min: Looking for foreign partners to assist in increasing capacity of three refineries
- says early results from Libyan fields being explored by BP are encouraging.
- believes demand for oil may not be stable during 2010; need better compliance; any increased demand will likely be met by non-OPEC members.
7:01:51 AM
(EU) ECB's Paramo: Problems could occur if rates remain low for too long a time
- sees difficulties from high budget deficits as it could make fiscal exit strategies more difficult
- reiterates that many stimulus packages will come to an end naturally
7:25:08 AM
(US) 130 members of the US House of Reps have reportedly requested US Treasury Sec Geithner name China as a currency manipulator in the upcoming report in April
- claim the currency intervention is a subsidy
- Note: on 2/25 15 US Senators requested the Commerce Dept investigate whether the China currency pratices should be considered an 'illegal subsidy' ; and suggested the Commerce dept implement duties
Please read our disclaimer:
Trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the markets. The videos are neither a solicitation nor an offer to Buy/Sell futures or options. The past performance of any trading system or methodology is not necessarily indicative of future results.
Rule 4.41 - Hypothetical or simulated performance results have certain limitations. Unlike an actual performance record, simulated results do not represent actual trading. Also, since the trades have not been executed, the results may have under-or-over compensated for the impact, if any, of certain market factors, such as lack of liquidity. Simulated trading programs in general are also subject to the fact that they are designed with the benefit of hindsight. No representation is being made that any account will or is likely to achieve profit or losses similar to those shown. Learn to trade futures forex stocks.
“Of course the game is rigged. Don't let that stop you--if you don't play, you can't win.”
Market Week Wrap-up
- Markets whipsawed lower then higher this week in an atmosphere of uncertainty as conflicting headlines out of Europe on Greece and mixed US data kept trading unsettled. The week began on a strong note, with China back in the mix after its week-long Lunar New Year holiday and Europe seemingly ready to disclose firm details about how much it would spend to save Greece. But the Greek situation quickly devolved back into rounds of accusations and vapid rhetoric, the US February Consumer Confidence index hit its lowest level in almost a year and the FDIC released a dire quarterly troubled bank list, all contributing to fresh risk aversion Tuesday morning. The FDIC increased the number of institutions being monitored by 27% q/q and noted its deposit insurance fund is now deeply in deficit, at -$20.9B compared to -$8.2B q/q. Markets steadied briefly on Wednesday as Fed Chairman Bernanke and Treasury Secretary Geithner testified on Capitol Hill. In his annual monetary policy report, Bernanke reiterated that the key rate was likely to stay low for an "extended period." Commenting on fiscal policy, Bernanke warned that the government's current budget path is not sustainable given CBO projections and said bond markets could get worried and drive up rates. Thursday saw steep declines in equity markets thanks to the softer than expected weekly claims data, weak ex-transport durables and another round of Greece jitters - then investors drove equities higher Thursday afternoon, recouping much of their earlier losses ahead of the second reading of US Q4 GDP on Friday morning. The US GDP data was a bit higher than the advance reading, hitting 5.9%. Meanwhile the UK managed to eke out a Q4 GDP rating that was a bit firmer than expected as well. But despite theses unexpectedly robust GDP numbers, uncertainty over the recovery remains. Fed Governor Pianalto said the recovery "does not feel like one" while BoE Governor Barker warned the UK could see another quarter of negative production (but would not describe this outcome as a "double dip"). For the week, the DJIA dropped 0.7%, the Nasdaq declined 0.3%, and the S&P500 fell 0.4%.
- It has been a quiet week on Wall Street, with little economic data or corporate earnings on the docket. The week before quadruple witching, the Nasdaq showed above average volumes pushing tech-heavy index out to 16-month highs, helped by a steady stream of takeover chatter. All three leading US equity indices made slow, steady gains, with risk appetite of a tepid variety driving trade. The euro bounced higher as the Greek situation calmed down, despite nationwide general strikes that made for dramatic coverage in the general press. President Obama's legislative agenda moved closer to key votes, with prospects for healthcare and financial reform looking stronger. Crude moved slightly lower, closing the week just above the $81 handle, while gold came off a little, to close just above $1,100. With employment levels a central focus for markets, traders mulled over chatter that the March US nonfarm payrolls could be broadly positive: a note from Goldman Sachs projected a +275K number (comprising an underlying trend assumption for March of 50k, a weather snapback of 100k, and census hiring of 125k). Better than expected US February Advanced Retail Sales on Friday gave stocks a lift early on, but they fizzled for the rest of the day, helping to break a 10 day winning streak in the S&P 500 index (though S&P futures maintained an 11 day streak, the best since 1982). For the week, the Nasdaq rose 1.8%, the DJIA increased 0.5%, and the S&P500 climbed 1.0%.
- In Washington, the two of centerpieces of President Obama's domestic agenda moved closer to key votes in the US Senate. On healthcare, a vote using reconciliation looks likely for sometime next week, following comments from House Speaker Pelosi on Friday afternoon. President Obama delayed a trip to Asia originally scheduled for next week, presumably to seize on improved prospects for passage. On financial regulation, Senate Banking Committee Chairman Dodd said he would release his overhaul bill on Monday, without the support of his Republican colleagues, senators Corker and Shelby. Dodd said his bill would address too big to fail, consumer protection, financial industry transparency, and derivatives oversight, although apparently work remains to be accomplished on this last point. The bill would put consumer financial products agency under the control of the Fed, which would also retain supervision authority over banks with more than $50B in assets (i.e banks 'too big to fail').
- Shares of AIG and Citibank made big moves this week on both news and rumors. On Monday AIG clinched a deal to sell its foreign life insurance unit to MetLife for about $15.5B in cash and stock as the firm continues to raise funds to repay US government aid. On Tuesday, rumors circulated that new short selling rules would restrict shorting Citi, AIG and GSEs. The SEC was out within hours denying the reports, but not before both AIG and Citi rose sharply. Rochdale's Dick Bove said demand for Citi preferred securities was propelling the bank's common stock higher (he also said Citi would post a loss in Q1 and Q2). There were other unconfirmed reports that Citi would sell its real estate investment unit to Apollo Management. Various sources attributed strength in the firms to a possible short squeeze. At its highest point on Wednesday, AIG was up nearly 30% on last Friday's close, while Citi was up nearly 18%.
- Semi industry bellwethers Texas Instrument and Novellus systems offered subdued quantitative mid-quarter guidance this week. Qualitative comments were more bullish: TXI executives said demand is robust, with strong orders driven by the demand side rather than just the supply side. Novellus boosted its orders forecast for the quarter. Burger King warned that January and February comps were severely impacted by the winter weather, with a loss of 3.0 percentage points to comps. Meanwhile McDonald's made no such excuses, reporting Feb global SSS +4.8%, its best monthly reading since May of last year. CF Industry's long-running pursuit of Terra Industries came to a successful conclusion after CF finally named a price CF's board could accept, at $37.15 in cash and 0.0953. Agrium abandoned its offer for CF as a result.
- With the Greek debt tragedy seemingly out of the headlines and US employment fears in the rear view mirror, bond traders saw much of their focus shift to a robust supply calendar in both corporate and government markets. Stellar auction results on both sides of the Atlantic were ultimately offset by strength in riskier asset markets (the S&P 500 closed at fresh 2010 highs on Thursday at 1,150) allowing prices to drift lower and yields higher as the week progressed. Perhaps the biggest story of the week for debt markets was Thursday's 30-year bond sale. Direct bidders accounted for almost 30% of competitive bids - a record high and the first time in a bond auction that the direct bidding category exceeded indirects. It still remains unclear just which direct institutions are bidding so aggressively and why, but regardless in general bulls are comforted by what appears to be investors' ravenous appetite for yield. This point was only further illustrated by heavy corporate issuance, where sizeable offerings denominated in both euros and dollars, across the investment grade spectrum came to market. Bank of America, Novartis, Amgen, Commerzbank, Medtronic, Steel Dynamics, Nelnet were some of the offerings that were well received in what was one of the most active weeks on record since the financial crisis.
- The battered euro made steady gains against the dollar this week - EUR/USD tested its highest level since early February around 1.3800 - as the Greece situation quieted down and other factors benefited the European currency. Traders described the bounce as primarily technical, even as short positions in EUR/USD remain at record levels. The Russian Central Bank continued to shift its floating ruble band lower all week. The Russians have adjusted the basket sixteen times since mid-February, and dealers say this has fueled demand for the euro. President Obama's drive to double US exports within five years is weighing upon dollar sentiment. Even the Poles beat up on the greenback, with the Polish Central Bank commenting that it has lowered its portion of dollars (and sterling) it its reserves and increased holdings of AUD and NOK.
- While Greece's predicament steadfastly refuses to fade into the background, investors seemed to gain more confidence in the Euro Zone's plan to deal with its wayward member. Essentially Germany and France have made it clear that the Euro Zone stands ready to provide aid should Greece struggle to fund its budget deficit, although no direct financial backing or guarantee has been offered for now. The EU Commission said the Greek austerity plan appeared sufficient to reach its 2010 budget goals, although it warned projected tax revenues gains and spending cuts were a bit over optimistic. Portugal provided a roadmap for its 2010-13 austerity package, projecting a deficit-to-GDP ratio to 2.8% by 2013 via a combination of revenue boots, spending cuts and economic growth. Fitch aired its concerns about the European peripherals, generating a degree of risk aversion after warning that Portugal might be downgraded if its reforms were insufficient. Note that various European officials discussed proposals to form a European Monetary Fund (EMF) to combat Euro Zone financial crises.
- Sterling maintained a soft tone early in the week on more fears that the upcoming election will result in a hung parliament. The polls out this week suggest Labour and the Conservatives are neck and neck. Note that the UK is scheduled to disclose its 2011 budget on March 24, making a May 6th general election seem quite likely. Fitch said the UK's sovereign credit profile has deteriorated quite sharply and its economic outlook remains uncertain, but also commented that strong fundamentals support the UK's current AAA sovereign rating. UK production data declined for the first time since August GBP/USD tested 1.4885 at one point. However, the pair staged a technical rebound to trade near 1.52 area.
- The Swiss National Bank (SNB) left rates unchanged, as expected, and revised its economic growth forecasts higher. The bank's wording on the Swiss Franc appeared largely unchanged from past statements, indicating it will combat any strengthening of the franc. In addition, the SNB predicted Swiss inflation would breach the bank's 2% threshold for price stability by 2012. EUR/CHF moved below the 1.46 level for the first time in over a year.
- The yen was firmer in the early part of the week thanks to fiscal year end flows, in which exporters repatriate money back home. However, global interest rate differentials continue weigh on the yen and Japanese official seemed to have changed their tune on seeking a stronger currency. There was growing chatter that the BoJ might be leaning toward further easing monetary policy at its policy meeting next week. US three-month labor rates continued to remain above the corresponding yen libor fixing since the move last week. USD/JPY tested above the 91 level as the week ended. On a weekly note the last coordinated central bank move in this pair back in 1995 was performed under similar technical circumstances (the move occurred at 95 back then, after posting a 79.20 all-time low during that cycle).
- The week saw lots of action out of China, including key inflation data, continued comments out of the National Policy meeting and trade issues. Speculation mounted that China might announce a major policy change in interest rates or even currency valuation at one point during the week (nothing materialized on either front). Sharp comments from the China's Custom Bureau diminished any chance of a yuan revaluation for the time being. IMF's Strauss-Kahn commented in a speech that China's CNY currency was undervalued. PBoC Chief Zhou expressed greater flexibility toward the possibility of revaluing the yuan, but did not indicate any timing for a possible shift in the currency. Chinese Commerce Minister Chen downplayed revaluation talks, reiterating the cabinet position that yuan reform would be gradual and controlled.
- Chinese February economic data saw the pace of growth in industrial production slowing to a 5-month low of 12.8% V 19.0%E, but inflation printing at 16-month high for both CPI and PPI. CPI rose 2.7% y/y v 2.5% expected and PPI ticked up to 5.4% v 5.1%e. New Yuan loans fell 50% m/m and 36% y/y to CNY700B from January's CNY1.4T following monetary policy intervention in January and February. Chinese officials downplayed the fluctuations, attributing extreme changes to seasonality of the lunar New Year holiday falling on different months in 2009 and 2010. Chinese stats bureau reflected on high inflation levels, noting that CPI would decline in March from February as weather improves, with much of the pricing pressure coming from food shortages and overheated housing sectors.
- China's FX Regulator SAFE warned that the price of gold would rise if China purchased the metal in order to diversify its currency reserves. SAFE said that in the long term, the investment yield on gold not so good given the lack of interest yield and cost of insurance, and said it would be wary of adding to China's gold holdings. SAFE stressed that the treasury market was the best choice for China. Note that this report comes as China continues to seek out ways to diversify its foreign currency reserves away from dollar-denominated assets. Over the last several weeks, there have been various unsubstantiated rumors regarding China buying gold.
- In Australia, the disappointing data this week may put pressure on expectations for another rate hike. Aussie Jan home loans fell at the quickest pace in years at-7.9% v 2.0% increase expected, highlighting the impact of recent RBA rate hikes on financing activity. February jobs data saw only a few hundred net new jobs, well below the 15K expected, and the jobless rate ticked up to 5.3% from 5.2%. Following the jobs data, fixed income market probabilities for April RBA 25bp tightening fell about 10% below 30%.
- In New Zealand, the Reserve Bank left rates unchanged as expected at 2.50% and reiterated its commitment to withdraw policy stimulus in mid-2010 as previously forecasted. Kiwi dollar traded weaker across the board however after RBNZ warned that domestic recovery is still sluggish, business spending cautious despite improved confidence, and households remain cautious.
Week of 3/15/2010 thru 3/19/2010
Monday, March 15, 2010
Economic
08:30 March Empire Manufacturing, Chile Feb Copper Exports
09:00 Jan Net Long-Term TIC Flows, Jan Total Net TIC Flows
09:15 Feb Industrial Production, Feb Capacity Utilization
13:00 March NAHB Housing Index
Tuesday, March 16, 2010
Economic
08:30 Feb Import Price Index, Feb Housing Starts, Feb Building Permits, Canada Jan Wholesale Sales
14:15 FOMC rate decision
16:30 API Crude Oil/Gasoline/Distillate Inventories
17:00 Colombia Jan Trade Balance
Wednesday, March 17, 2010
Economic
08:30 Feb PPI, Feb Feb PPI Ex Food & Energy
10:30 DoE Crude Oil/Gasoline/Distillate Inventories
13:00 Treasury's $21B 10-yr note auction
Thursday, March 18, 2010
Economic
08:30 Feb CPI, Feb CPI Ex Food & Energy, Feb CPI Core Index SA, Q4 Current Account Balance, Initial Jobless Claims, Continuing Claims, Chile Q4 GDP
10:00 Feb Leading Indicators, March Philadelphia Fed
10:30 Natural Gas Inventories
11:00 Treasury note announcement
17:00 Colombia Jan Industrial Production, Retail Sales
18:00 Chile rate decision
Friday, March 19, 2010
Economic
07:00 Canada Feb CPI, Jan Retail Sales
11:00 Mexico rate decision
15:00 Argentina Q4 GDP, Industrial Production
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Please read our disclaimer:
Trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the markets. The videos are neither a solicitation nor an offer to Buy/Sell futures or options. The past performance of any trading system or methodology is not necessarily indicative of future results.
Rule 4.41 - Hypothetical or simulated performance results have certain limitations. Unlike an actual performance record, simulated results do not represent actual trading. Also, since the trades have not been executed, the results may have under-or-over compensated for the impact, if any, of certain market factors, such as lack of liquidity. Simulated trading programs in general are also subject to the fact that they are designed with the benefit of hindsight. No representation is being made that any account will or is likely to achieve profit or losses similar to those shown. Learn to trade futures forex stocks.
07:00 Canada Feb Unemployment Rate
08:30 Fed Advance Retail Sales (last 0.5%, ex auto 0.6%),
09:55 March prelim Univ of Michigan confidence (last 73.6)
10:00 Dec Business Inventories (last -0.2%), Mexico Dec Industrial Production
14:00 Argentina Feb CPI
Today’s Headlines
4:18:39 AM
(LV) Latvia Central Bank cuts refi rate by 50bps to 3.50% (unexpected)
- Cuts deposit rate by 50bps to 0.50%
- Maintains FY10 deflation target of 3.8%
- Sees economy returning to growth in Q4 2010
5:30:03 AM
*(US) JAN TRADE BALANCE: -$37.3B V -$41.0BE
- Prior revised from -$40.2B to -$39.9B
Components
- Imports M/M: $180.0B v $182.9B prior
- Exports M/M: $142.7B v $142.7B prior
6:06:55 AM
(PD) Poland Central Bank's Rzonca: Zloty currency strength is main threat to economy; Difficult to tighten Polish interest rates at this time due to potential external shocks
- Hope additonal Zloty appeciation can be avoided
- ees 2010 Polish GDP growth over 3%
5:30:04 AM
*(US) INITIAL JOBLESS CLAIMS: 462K V 460KE; CONTINUING CLAIMS: 4.558M V 4.500ME
- Prior Initial Claims revised down from 469K to 468K
- Prior Continuing Claims revised higher from 4.500M to 4.521M
- 4 week average for claims at 475.5K v 471K prior
7:02:06 AM
(US) Pres Obama: Export increases are key to G20 for sustainable and balanced economic growth
- Believes China allowing the yuan to increase would aid US exports.
- US must remain the world's number one exporter.
- Wants to move forward on trade pacts with South Korea, Panama, Colombia in ways that "uphold US values."
Please read our disclaimer:
Trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the markets. The videos are neither a solicitation nor an offer to Buy/Sell futures or options. The past performance of any trading system or methodology is not necessarily indicative of future results.
Rule 4.41 - Hypothetical or simulated performance results have certain limitations. Unlike an actual performance record, simulated results do not represent actual trading. Also, since the trades have not been executed, the results may have under-or-over compensated for the impact, if any, of certain market factors, such as lack of liquidity. Simulated trading programs in general are also subject to the fact that they are designed with the benefit of hindsight. No representation is being made that any account will or is likely to achieve profit or losses similar to those shown. Learn to trade futures forex stocks.
07:00 Brazil Q4 GDP, Brazil Jan Retail Sales
08:30 Jan Trade Balance (last -$40.2B), Initial Jobless Claims (last 469K), Continuing Claims (last 4.50M), Canada Jan Housing Price Index, Canada Q4 Capacity utilization
10:30 Natural Gas Inventories
13:00 Treasury's $13B 30-yr note auction
Today’s Headlines
3:50:15 AM
(EU) EU Draft Document on Exit strategies: No existing stimulus measures should be extended nor new measures introduced
- EU must exit industry aid as quickly as possible
- Labor market stimulus measures should begin by mid 2010 period and end when economic recovery is secured
- Sees substantial costs from a delayed withdrawal
5:10:13 AM
(UK) BoE's Posen: Should not read too much into short term moves in FX rates; Could add more quantitative easing measures if negative economic developments occur
- Additional BOE action not necessarily be quantitative measures (QE)
- GBP currency decline would have been much greater if market lost confidence in the BOE's CPI outlook
5:30:31 AM
(US) USDA March Crop Production Report/WASDE: FL 2009/10 orange crop seen at 131M boxes +1.6% m/m (-19% from 2008/09 output)
- US 2009/10 orange crop seen at 189.6M boxes v 185.6M prior view
- Florida frozen concentrated orange juice (FCOJ) yield forecast for the 2009-10 season is 1.53 gallons per box at 42.0 degrees Brix, down 2% from the February 1 forecast and down 8% from last season's final yield of 1.66 gallons per box.
6:00:51 AM
(EU) ECB's Weber: Markets have stabilized and economic recovery has begun
- Says the 'Volcker Rule' could adversely effect monetary policy transmission
- Sees three more years (2013) for Germany to regain lost output from recession
10:01:44 AM
TREASURY'S $21B 10-YEAR NOTE REOPENING DRAWS 3.735%; BID-TO-COVER RATIO: 3.45 V 3.00 PRIOR AND 2.88 OVER THE LAST 6
- Indirect bidders take 35.1% of competitive bids, with 70.94% alloted at high
- 17.5% go to Direct bidders
- Median 3.7%, Low 3.636%
Please read our disclaimer:
Trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the markets. The videos are neither a solicitation nor an offer to Buy/Sell futures or options. The past performance of any trading system or methodology is not necessarily indicative of future results.
Rule 4.41 - Hypothetical or simulated performance results have certain limitations. Unlike an actual performance record, simulated results do not represent actual trading. Also, since the trades have not been executed, the results may have under-or-over compensated for the impact, if any, of certain market factors, such as lack of liquidity. Simulated trading programs in general are also subject to the fact that they are designed with the benefit of hindsight. No representation is being made that any account will or is likely to achieve profit or losses similar to those shown. Learn to trade futures forex stocks.
10:00 Jan Wholesale Inventories (last -0.8%)
10:30 DoE Crude Oil/Gasoline/Distillate Inventories
13:00 Treasury's $21B 10-yr note auction
14:00 Feb Monthly Budget Statement (last -$42.6B)
Today’s Headlines
5:30:02 AM
*(US) INITIAL JOBLESS CLAIMS: 469K V 470KE; CONTINUING CLAIMS: 4.50M V 4.60ME
- Prior Initial Claims revised higher from 496K to 498K
- Prior Continuing Claims revised higher from 4.617M to 4.63M
4:00:37 AM
(CZ) Czech Central Bank Feb inflation seen below forecasts due lower adjusted inflation, excluding fuel prices
***Reminder: Czech CPI data was released earlier today and came in below expectations in both the MoM and YOY (see our 3;00 headline)
4:12:21 AM
(PD) Poland Central Bank Bratkowski: Poland Interest rates will likely remain unchanged in 2010
- Rate Panel should consider the Zloty currency more when conducting policy
- Forecasts 2010 GDP gorwth seen between 2.0% to 2.5%
-Earlier today Central Bank Gov Skrzypek commented that the: Monetary policy bias remained neutral (see our 4:37 headline)
4:34:14 AM
(US) NFIB: Small business continues to not spend on CAPEX at this time - CNBC
- Need to see consumer come back to ramp up sales
- Borrowing remains low as turnover levels do not call for further investment
5:00:39 AM
(EU) ECB's Weber: Does not think much on EMF plan; Euro Zone needs the power to correct deficits if plan creates more pressure on budgets
- Believes it is unhelpful to discuss creating new Euro Zone institutions, need to make existing Euro Zone framework more credible.
- Unclear whether the CDS market needs to be restricted.
- May impose bigger haircuts on lower-rated debt.
10:01:44 AM
*(US) TREASURY'S $40B 3-YEAR NOTES DRAW 1.437%; BID-TO-COVER RATIO: 3.13 V 2.83 PRIOR AND 2.89 AVG OVER THE LAST 10 AUCTIONS
- Indirect bidders take 51.9% of competitive bids, direct bidders take 10.3% of competitive bids, primary dealers take 37.8%
- 15.66% allotted at high
- Median 1.403%; Low 1.34%
Please read our disclaimer:
Trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the markets. The videos are neither a solicitation nor an offer to Buy/Sell futures or options. The past performance of any trading system or methodology is not necessarily indicative of future results.
Rule 4.41 - Hypothetical or simulated performance results have certain limitations. Unlike an actual performance record, simulated results do not represent actual trading. Also, since the trades have not been executed, the results may have under-or-over compensated for the impact, if any, of certain market factors, such as lack of liquidity. Simulated trading programs in general are also subject to the fact that they are designed with the benefit of hindsight. No representation is being made that any account will or is likely to achieve profit or losses similar to those shown. Learn to trade futures forex stocks.
(PO) Portugal austerity guidelines of the stability and growth pact update for 2010-2013: Indicates Portugal could cut deficit-to-GDP ratio to 2.8% by 2013, from 8.3% in 2010 - Draft budget
- Gov't see budget deficit of 6.6% in 2011 and at 4.7% in 2012
- Forecasts 2011 GDP growth at 0.9%; at 1.35 in 2012 and up 1.7% in 2013
3:16:17 AM
(EU) EU Commission: Ready to propose a European Monetary Fund (EMF); No details provided
- Support mechanism to have rigorous conditionality.
- Currently preparing support mechanism for Greece.
- Ready to act to improve economic governance of Euro Zone.
3:42:10 AM
Fitch revises Lithuania outlook to Stable from Negative; affirms BBB rating
- States: Although the fiscal deficit remains high, consolidation measures enacted to date have been substantial and the government has articulated a credible medium-term plan for reducing the deficit to 3% of GDP by 2012
7:00:45 AM
(US) New York Fed to expand number of firms participating in reverse repo facility; warns no inferences should be drawn regarding monetary policy
- The New York Fed requires firms having net assets of no less than $20B for six consecutive months prior to applying as a reverse repo counterparty.
7:46:04 AM
ECB's Stark: A European IMF style institution would be against the rules of the EMU; could create false incentives and place burden on some countries
- highlights that a European monetary fund would allow countries with weak finances to continue poor policies.
- creation of such a fund could harm the acceptance of the Euro.
- feels reforms of stability and growth agreements is the better way forward, with penalties for countries who break deficit rules.
9:00:38 AM
(UK) BoE's Barker: Cannot be confident in the pace of the recovery in the UK quite yet; exports are showing a disappointing reaction to weak sterling
- Extending QE may not boost asset prices further. Asset prices have not risen too high as of yet.
- There are grounds for optimism in recent economic data.
- Believes there are "risks" in driving economic growth too high in the near term.
Please read our disclaimer:
Trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the markets. The videos are neither a solicitation nor an offer to Buy/Sell futures or options. The past performance of any trading system or methodology is not necessarily indicative of future results.
Rule 4.41 - Hypothetical or simulated performance results have certain limitations. Unlike an actual performance record, simulated results do not represent actual trading. Also, since the trades have not been executed, the results may have under-or-over compensated for the impact, if any, of certain market factors, such as lack of liquidity. Simulated trading programs in general are also subject to the fact that they are designed with the benefit of hindsight. No representation is being made that any account will or is likely to achieve profit or losses similar to those shown. Learn to trade futures forex stocks.
March 05, 2010
Busy Friday! Dollar Index Correlation saved us today!
“All life is an experiment. The more experiments you make the better.”
Market Week Wrap-up
- Equity indices gapped lower this week in the face of growing risk aversion, with traders disregarding robust corporate earnings and a strong first reading of US GDP. The Shanghai Composite dropped below 3,000 for the first time since late 2008, while the DJIA closed within 44 points of 10,000 and commodities traded off hard. On Friday, advance GDP showed the US economy grew faster than expected in Q4, at an annualized rate of 5.4%. If the GDP reading holds up upon revision, GDP in the final quarter of 2009 would be higher than at any time since September 2003. Housing data was mixed: the November S&P/CS index gained for the sixth consecutive month, although the move up was modest. Meanwhile, December new home sales fell nearly 8% m/m (following an 11% m/m decline in November), prompting Yale Economist Robert Shiller to reiterate that he believes home prices could be faltering yet again. President Obama gave his first State of the Union speech on Wednesday, offering a trenchant defense of his first year in office while also admitting certain mistakes had been made. The President promised to double US exports over the next five years and make job creation a primary focus, and also said $30B in repaid TARP funding would be redirect to loans for small businesses. Ahead of the speech, the Congressional Budget Office released predictions for a $1.35T deficit for this year as the economy continues to slowly recover from the recession. After a flurry of Washington drama last week (full of implicit threats to Fed policy independence), the Senate handed Ben Bernanke a second term as Fed chairman in a 70 to 30 vote. For the week, the DJIA lost 1.1%, the Nasdaq dropped 2.6% and the S&P 500 fell 1.7%.
- Clarity on the Greek debt situation, incremental improvements in the US employment picture and other positive economic data kept markets moving in the right direction all week long. The US Feb ISM non-manufacturing index hit its highest level since Oct 2007, February same-store sales and auto sales figures were relatively strong, and January consumer credit figures registered their first increase in 12 months. In another sign that companies are raising output without adding many jobs, productivity rose sharply in Q4. Unsurprisingly, the January pending home sales data followed in the footsteps of several recent housing numbers to the downside. Friday's Feb employment reports showed that annualized unemployment held steady at 9.7%. Non-farm payrolls nearly turned positive despite fears last month's blizzards would white out over 100K jobs. Administration officials made the rounds after the data were released, insisting that the numbers would have been even stronger if not for the dire weather in February. Ultrahawk Fed Governor Fisher said the US is far away from a pickup in hiring and said he expects unemployment rate to remain around 10% for a while. As expected, President Obama said the Democrats would push healthcare reform through the Senate using budget reconciliation rules, formally launching the "nuclear option." Speculation about an overheating Chinese economy was in the background all week. US press articles discussed whether the country is facing a real estate bubble or not, while government and PBoC officials all insisted that inflation would not get out of hand this year. Nearly everything went right for investors, and sharpening risk appetite pushed the Nasdaq out to a 52-week high by Friday afternoon, while the DJIA gained triple digits. For the week, the Nasdaq rose 3.9%, the DJIA increased 2.3%, and the S&P500 climbed 3.1%.
- Merger activity continued at a healthy clip this week, with a concentration in the pharmaceutical sector. Japanese drugmaker Astellas launched a $3.5B hostile takeover offer for OSI Pharmaceuticals, bidding $52 a share in cash, and Germany's Merck KGaA snapped up biotech supplier Millipore for around $6B in cash, at $107/share. Biotechs Geron and Cephalon, which are often the subject of market rumors, were mentioned as potential targets.
- The headline M&A deal of the week was AIG's agreement to sell its AIA unit to the UK's Prudential for $35.5B. Deals involving private equity funds are picking up again as well, indicating a broad return to health in credit markets. Elliott Associates offered $5.75/share in cash for enterprise software developer Novell, for a total transaction value of $1B. ABRY Partners signed a deal to acquire telecom services firm RCN Corporation at $15/shr, for a total of $1.2B in cash and debt. In other M&A news, CF Industries upped its offer for Terra, topping an firm offer from Norway's Yara International made in mid February. Note that Terra's board had already agreed to Yara's deal, after rebuffing CF for months. Later in the week there were reports Agrium might be mulling a fresh offer for CF, although the reports indicated that the firm would hold off until CF resolved its hostile bid for Terra.
- Retailers released another set of strong same-store sales figures, with February comps appearing even better than relatively positive showings in December and January. Shoppers were apparently not put off by the terrible weather seen in the month, providing more hope for a gradual recovery in consumer spending. Nearly every major apparel name beat expectations. Impressive outperformance was seen from former laggards Abercrombie and Zumiez. Department store names were more in line with expectations, with more misses, including high-end name Saks, which had delivered strong outperformance in the last two months. Monthly sales numbers from auto companies were also relatively strong, with Ford's sales a remarkable 43% above last year's levels (keeping in mind the state of the auto industry last February). In addition, Ford reported higher total monthly sales than GM for the first time since 1998. On Friday, GM said it would reinstate up to 1,000 dealerships that were dropped during the company's bankruptcy process last year.
- Corporate earnings were not a significant factor this week, although there were a few notable reports. Homebuilder Hovnanian reported its first quarterly profit since late 2006, thanks largely to a big income tax benefit. Like the rest of the industry, declines in Hovnanian's backlog are much smaller than a few quarters ago, while the cancellation rate is falling sharply. Home furnishings name Ethan Allen complimented the news out of Hovnanian, noting that orders for the first two months of 2010 are up an impressive 25% y/y. Mining equipment manufacturer Joy Global roundly beat expectations on a big gain in new orders and tightened up its 2010 guidance. According to executives, although the rate of growth in commodity imports into China has begun to moderate, imports are expected to remain near their current high levels. Staples's Q4 results were largely in line with expectations. Executives at the firm expect the US economy to remain more or less the same and are not projecting any dramatic improvements.
- Greece finally issued €5B worth of 10-year bonds this week, and reliable reports of healthy demand for the paper allowed nervous investors in debt, currency and equity markets alike to rest easy, at least temporarily. The issuance came hot on the heels of a €4.8B austerity package from the Greek government, which was widely applauded by officials across Europe. Moody's said the austerity measures would provide some certainty for 2010, but implementation was questionable in subsequent years. Although things are looking a little rosier for Greece's fiscal situation, protestors took to the streets all week in the capital, which may test the resolve of the government going forward.
- The market still estimates that Greece needs to raise somewhere in the vicinity of €20B by May simply to pay the interest on and to refinance existing debt. But the German government, for obvious reasons, remains steadfastly opposed to a bailout. Following the austerity package, Greek PM Papandreou upped the ante by threatening to seek help from the IMF - an outcome which would ultimately deal a monumental blow to the credibility of the European Union and common currency (two projects championed by Germany and France). As it stands a debt guarantee (as opposed to direct monetary assistance) is shaping up as the outcome most acceptable to both parties. As the week drew to a close the streets of Athens were stilled filled with protestors, and rumors that Greece is set to downgrade its GDP forecasts (effectively worsening its debt burden at the stroke of a pen) refuse to go away.
- The European peripheral situation remained the catalyst for price action in currencies this week. Greece's austerity package and the negative reaction to it among Greek unions initially sent the euro to nine-month lows below 1.3450. Overall EUR/USD maintained its familiar range between 1.3450 and 1.3730, with stops probed at either end. There were no surprises in the BoE and ECB interest rate decisions on Thursday morning, with both central banks leaving policy unchanged, as expected. The ECB press conference communicated that the decision to withdraw measures was made by overwhelming consensus and added that the decision was not a signal for rates. Trichet stated that the ECB would not pre-commit to more liquidity extensions and promised that the bank would lend out covered bonds purchased in its quantitative easing program. The reserve currency issue was lurking in the background, with talk focusing on gold reserves in the wake of last week's IMF gold dust up. Russian Central Banker Ulyukayev commented that Russia would increase the proportion of gold in its reserves. Data shows that gold makes up 5.3% of Russia's reserves, up from the 4.3% seen back in late November.
- Sterling was rattled by M&A flows and growing concerns that a hung parliament could emerge from the upcoming UK general elections. The pound was softer following announcement that Prudential (UK) would acquire AIA from AIG for $35.5B in cash and equity. GBP/USD hit fresh nine-month lows below 1.5000 level and EUR/GBP regained a foothold above the 0.9050 level in the wake of the announcement. With the election looming, the pound is at the mercy of various polls showing the Tory lead over Labour narrowing to as little as two percentage points, raising fears that neither party could win the decisive 10% margin over the other generally considered necessary for uncontested rule.
- The yen weakened in the latter part of the trading week. According to a draft of Japan's FY10/11 budget, the government may increase the borrowing limit for foreign exchange intervention (the last time this limit was raised was 2004). The draft budget suggests the foreign exchange special account's borrowing ceiling will be raised by more than ¥4.5T to ¥145T. Also weighing the JPY were interest rate factors, after three-month JPY Libor moved below the USD fixing on Thursday morning for the first time since Aug 2009. USD/JPY tested above the 90 level following the better US employment data on Friday.
- A report on Friday from Nikkei News suggested that Japan's central bank may consider expanding its liquidity program, helping the yen retreat from 3-month highs against USD seen on Thursday. Japanes Finance Minister Kan said he would welcome the move but conceded he has not heard anything specific from the BoJ. Kan also commented on recent yen trends, suggesting the gains since mid-February could be attributed to turmoil stemming from Greece and may subside going forward. The BoJ is expected to next meet on interest rates on March 16th.
- On Friday Chinese Premier Wen outlined performance target for the economy in 2010, in the equivalent of China's State of the Union address. Wen reaffirmed a GDP growth target of 8% and said CPI is expected at 3%, while targets for industrial production and M2 money supply growth were put at 11% and 17% respectively, with new loans expected to contract to CNY7.5T from CNY9.6T in 2009. Regarding currencies, Wen said exchange rate reform would continue to be improved in a way that would retain the basic stability of the yuan. On the fiscal front, China's Ministry of Finance said the budget deficit was expected at 2.8% of GDP in 2010 and below 3% in coming years. On the issue of the overheated housing sector, Wen noted the cabinet would "resolutely" curb housing price gains and speculative house purchases, promising to increase land supply for low and medium-cost housing. Banking regulator Liu also chimed in on the speculative housing bubble, stating that the pace of bank lending is more stable, and loan books of banks appear to be safer.
- After surprising some prognosticators last month by pausing its policy tightening campaign, Australia's RBA raised rates another 25bps to 4.00% on Monday. The RBA noted that growth in the global economy makes it appropriate for rates to be closer to average. In a notable deviation from last month's statement, the RBA omitted specific reference to China looking to reduce its stimulus, and also upgraded its assessment of resource sector investment to "very strong" from "strong." Tightening seemed justified a day later when the Australia government reported Q4 GDP strengthened at its highest rate since Q2 of 2008, rising on q/q basis by 0.9% and 2.7% y/y. On Wednesday, the country's January trade balance came in at a seven month high, at -A$1.2B v -A$1.6Be. On balance, shrinking import component was instrumental to the contraction, falling 3% m/m. Exports rose 1%, however exports to China as well as shipments of top 2 commodities--coal and iron ore--declined in value from prior month's levels.
Week of 3/8/2010 thru 3/12/2010
Monday, March 08, 2010
Economic
06:00 Brazil Feb Inflation, Chile Feb CPI
08:30 Canada Feb Housing Starts
10:00 Jan Wholesale Inventories (last -0.8%)
10:30 DoE Crude Oil/Gasoline/Distillate Inventories
13:00 Treasury's $21B 10-yr note auction
14:00 Feb Monthly Budget Statement (last -$42.6B)
Thursday, March 11, 2010
Economic
07:00 Brazil Q4 GDP, Brazil Jan Retail Sales
08:30 Jan Trade Balance (last -$40.2B), Initial Jobless Claims (last 469K), Continuing Claims (last 4.50M), Canada
Jan Housing Price Index, Canada Q4 Capacity utilization
10:30 Natural Gas Inventories
13:00 Treasury's $13B 30-yr note auction
Friday, March 12, 2010
Economic
07:00 Canada Feb Unemployment Rate
08:30 Fed Advance Retail Sales (last 0.5%, ex auto 0.6%),
09:55 March prelim Univ of Michigan confidence (last 73.6)
10:00 Dec Business Inventories (last -0.2%), Mexico Dec Industrial Production
14:00 Argentina Feb CPI
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Please read our disclaimer:
Trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the markets. The videos are neither a solicitation nor an offer to Buy/Sell futures or options. The past performance of any trading system or methodology is not necessarily indicative of future results.
Rule 4.41 - Hypothetical or simulated performance results have certain limitations. Unlike an actual performance record, simulated results do not represent actual trading. Also, since the trades have not been executed, the results may have under-or-over compensated for the impact, if any, of certain market factors, such as lack of liquidity. Simulated trading programs in general are also subject to the fact that they are designed with the benefit of hindsight. No representation is being made that any account will or is likely to achieve profit or losses similar to those shown. Learn to trade futures forex stocks.
08:30 Feb Nonfarm Payrolls (last -20K), Feb Unemployment Rate (last 9.7%), Feb Manufacturing Payrolls (last 11K), Feb Average Hourly Earnings (last m/m 0.2%, y/y 2.0%)
15:00 Jan Consumer Credit (last -$1.7B)
19:00 Chile Feb CPI
Today’s Headlines
5:30:02 AM
*(US) INITIAL JOBLESS CLAIMS: 469K V 470KE; CONTINUING CLAIMS: 4.50M V 4.60ME
- Prior Initial Claims revised higher from 496K to 498K
- Prior Continuing Claims revised higher from 4.617M to 4.63M
5:53:15 AM
(EU) ECB's Trichet: Reiterates that Greece leaving EMU is an absurd idea; Greece's austerity decisions were very substantial and convincing - Q&A
- Notes that it is worth reiterating our statement on Greece: "we welcome the additional fiscal measures and envision swift implementation of the measures."
5:56:58 AM
(EU) ECB's Trichet: Today's decision to withdraw measures was made by overwhelming consensus, decision is not a signal for rates
- Clarifies that the decision on interest rate stance was unanimous.
- IMF proposal that central banks should raise inflation targets is "plain wrong" and "dangerous."
6:39:26 AM
(GR) Greece Debt Agency Chief: Aiming to reach spread levels not much wider than Ireland's; not more than 10% of 10-year bond deal was placed in Greece
- Bond sale heavily skewed toward real money investors.
- Believes Greece is slowly regaining credibility.
7:15:23 AM
(US) Fed's Bullard: A larger monetary base has increased inflation risk; Fed must maintain a broad regulatory authority
- expansion of monetary base likely to be consistent
- quantitative easing should be comparable to interest rate policy
Please read our disclaimer:
Trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the markets. The videos are neither a solicitation nor an offer to Buy/Sell futures or options. The past performance of any trading system or methodology is not necessarily indicative of future results.
Rule 4.41 - Hypothetical or simulated performance results have certain limitations. Unlike an actual performance record, simulated results do not represent actual trading. Also, since the trades have not been executed, the results may have under-or-over compensated for the impact, if any, of certain market factors, such as lack of liquidity. Simulated trading programs in general are also subject to the fact that they are designed with the benefit of hindsight. No representation is being made that any account will or is likely to achieve profit or losses similar to those shown. Learn to trade futures forex stocks.
08:30 Feb Nonfarm Payrolls (last -20K), Feb Unemployment Rate (last 9.7%), Feb Manufacturing Payrolls (last 11K), Feb Average Hourly Earnings (last m/m 0.2%, y/y 2.0%)
15:00 Jan Consumer Credit (last -$1.7B)
19:00 Chile Feb CPI
Today’s Headlines
5:30:02 AM
*(US) INITIAL JOBLESS CLAIMS: 469K V 470KE; CONTINUING CLAIMS: 4.50M V 4.60ME
- Prior Initial Claims revised higher from 496K to 498K
- Prior Continuing Claims revised higher from 4.617M to 4.63M
5:53:15 AM
(EU) ECB's Trichet: Reiterates that Greece leaving EMU is an absurd idea; Greece's austerity decisions were very substantial and convincing - Q&A
- Notes that it is worth reiterating our statement on Greece: "we welcome the additional fiscal measures and envision swift implementation of the measures."
5:56:58 AM
(EU) ECB's Trichet: Today's decision to withdraw measures was made by overwhelming consensus, decision is not a signal for rates
- Clarifies that the decision on interest rate stance was unanimous.
- IMF proposal that central banks should raise inflation targets is "plain wrong" and "dangerous."
6:39:26 AM
(GR) Greece Debt Agency Chief: Aiming to reach spread levels not much wider than Ireland's; not more than 10% of 10-year bond deal was placed in Greece
- Bond sale heavily skewed toward real money investors.
- Believes Greece is slowly regaining credibility.
7:15:23 AM
(US) Fed's Bullard: A larger monetary base has increased inflation risk; Fed must maintain a broad regulatory authority
- expansion of monetary base likely to be consistent
- quantitative easing should be comparable to interest rate policy
Please read our disclaimer:
Trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the markets. The videos are neither a solicitation nor an offer to Buy/Sell futures or options. The past performance of any trading system or methodology is not necessarily indicative of future results.
Rule 4.41 - Hypothetical or simulated performance results have certain limitations. Unlike an actual performance record, simulated results do not represent actual trading. Also, since the trades have not been executed, the results may have under-or-over compensated for the impact, if any, of certain market factors, such as lack of liquidity. Simulated trading programs in general are also subject to the fact that they are designed with the benefit of hindsight. No representation is being made that any account will or is likely to achieve profit or losses similar to those shown. Learn to trade futures forex stocks.
07:00 BoE rate decision, Brazil Jan Industrial Production
07:45 ECB rate decision
08:30 Final Q4 Nonfarm Productivity (last 6.2%), Q4 Unit Labor Costs (last -4.4%), Initial Jobless Claims (last 496K), Continuing Claims (last 4.617M)
10:00 Jan Pending Home Sales (last m/m 1.0%, y/y 10.5%), Jan Factory Orders (last 1.0%), Canada Feb Ivey PMI, Mexico Feb Consumer Confidence
10:30 Natural Gas Inventories
11:00 Treasury note announcement
16:00 Colombia Feb PPI
Today’s Headlines
4:07:51 AM
(GR) Greece formally announces austerity measures of €4.8B (2% of GDP) - draft bill
- To increase VAT tax by 2% to 21%; will add €1.2B in revenues (0.5% of GDP)
- To raise €1B from a one-time company tax by end of 2010
- To raise duty on alcohol by 20%
- Further cuts in the government's wage bill (see €1.7B in savings)
4:39:26 AM
(GR) German Gov't spokesperson Steegmans: Will not offer aid to Greece during Friday's meeting between Chancellor Merkel and the GreekPM
- Meeting will only discuss current state of events
- Germany welcomes the Greek austerity measures announced earlier today and in line with talks
- Greece must implement austerity plans; confident that plan will stabilze the EUR.
5:36:55 AM
(US) Fed's Fisher: USD to remain reserve currency for some period of time; investor interest in USD forces discipline - Q&A at CFR
- Echoes that Fed should prevent asset bubbles
- Basel II has not worked as it did not capture risks in the system
- Fed in the early 2000's held rates too low for too long
6:00:41 AM
(GR) Greece Fin Min Papaconstantinou: To continue discussion with EU on financial aid
- Can not continue to borrow at current rates; reiterates Greece has no immediate need for new borrowing but monitoring markets for its next borrowing move
8:08:45 AM
(GR) Moody's: Austerity measures in Greece bring credibility to fiscal changes; measures consistent with A2 rating
** Note that Greece's sovereign debt carries an A2 rating at Moodys, two notches above the equivalent ratings at Fitch and S&P (BBB+).
-If Moody's were to recalibrate its rating in line with its peers it would render Greece's sovereign debt ineligible for ECB repo operations when collateral criteria reverts to the normal minimum thresholds (A3/A- or above) at the end of 2010
Please read our disclaimer:
Trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the markets. The videos are neither a solicitation nor an offer to Buy/Sell futures or options. The past performance of any trading system or methodology is not necessarily indicative of future results.
Rule 4.41 - Hypothetical or simulated performance results have certain limitations. Unlike an actual performance record, simulated results do not represent actual trading. Also, since the trades have not been executed, the results may have under-or-over compensated for the impact, if any, of certain market factors, such as lack of liquidity. Simulated trading programs in general are also subject to the fact that they are designed with the benefit of hindsight. No representation is being made that any account will or is likely to achieve profit or losses similar to those shown. Learn to trade futures forex stocks.
08:00 Brazil Jan Capacity Utilization
07:30 Feb Challenger Job Cuts y/y (last -70.4%)
08:15 Feb ADP Employment Change (last -22K)
10:00 Feb ISM Non-Manufacturing (last 50.5)
10:30 DoE Crude Oil/Gasoline/Distillate Inventories
13:00 Mexico Feb Manufacturing Index, Non-Manufacturing Index
14:00 Fed Beige Book
Today’s Headlines
5:29:39 AM
(GR) Greece govt spokesman: Greece to announce austerity measures tomorrow (in line with market speculation)
***Reminder:
- On Monday EU Monetary Affairs Commissioner Rehn stated that Greece must reveal new measures in the coming days to allay officials concerns that the current austerity plan falls short
6:00:00 AM
*(CA) BANK OF CANADA LEAVES INTEREST RATES UNCHANGED AT 0.25%; AS EXPECTED
- Drops language that inflation risks are tiling downwards;
- Pledge to keep steady rates through June will depend on inflation outlook
- Current outlook leaves room for April change
7:06:36 AM
Fed's Hoenig: Reaffirms Fed should not guarantee markets an 'extended period' of low rates; longer rates 'will take care of themselves' - CNBC interview
- feels that the Fed cannot go to 1% interest rate without causing issues, but believes the economy is strong enough to digest a 1% fed funds rate when it gets there
8:53:39 AM
(US) House Committee requests information related to claim denials by healthcare companies
- Asks CEOs from Humana, Aetna, Wellpoint and UnitedHealth to testify at 3/23 hearing.
****Reminder: On 2/24 HHS Secretary requested a March 3 meeting with CEOs of health insurers including WLP, UNH, CI, HUM and AET.
10:13:25 AM
(US) US Commerce Dept sets preliminary anti-subsidy duties of 4-13% on China, 17.5% on coated paper from Indonesia
- Notes still assessing whether to treat China's currency practices as a countervailing subsidy.
Please read our disclaimer:
Trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the markets. The videos are neither a solicitation nor an offer to Buy/Sell futures or options. The past performance of any trading system or methodology is not necessarily indicative of future results.
Rule 4.41 - Hypothetical or simulated performance results have certain limitations. Unlike an actual performance record, simulated results do not represent actual trading. Also, since the trades have not been executed, the results may have under-or-over compensated for the impact, if any, of certain market factors, such as lack of liquidity. Simulated trading programs in general are also subject to the fact that they are designed with the benefit of hindsight. No representation is being made that any account will or is likely to achieve profit or losses similar to those shown. Learn to trade futures forex stocks.
09:00 BoC rate decision
16:30 API Crude Oil/Gasoline/Distillate Inventories
Today’s Headlines
5:10:03 AM
(US) Preview: Jan Personal Income, Spending and PCE data due at 8:30 am ET
- Personal Income: 0.4%e v 0.4% prior.(Analyst range of estimates +0.2% to +0.6)
- Personal Spending: 0.4%e v 0.2% prior (Analyst range of estimates 0.2% to +0.6%)
5:30:02 AM
*(US) JAN PERSONAL INCOME 0.1% V 0.4%E; PERSONAL SPENDING: 0.5% V 0.4%E
- Prior Personal Income revised lower from 0.4% to 0.3%
- Prior Personal Spending revised higher from 0.2% to 0.3%
6:48:31 AM
(US) Fed Vice Chair Kohn to resign from Board of Governors when term ends; effective June 23
- Kohn became a board member in 2002. Kohn's retirement will leave three open seats on the Fed's board.
- On June 23, 2006, Dr. Kohn was sworn in as Vice Chairman of the Board of Governors of the Federal Reserve System for a four-year term ending June 23, 2010.
- Kohn was born Nov 1942
7:00:03 AM
*(US) FEB ISM MANUFACTURING INDEX: 56.5 V 57.9E; PRICES PAID: 67 V 68.0 PRIOR
- No revisions
**sub-indices:
- New Orders Index: 59.5 v 65.9 prior
- Production index: 58.4 v 66.2 prior
- Employment Index: 56.1 v 53.3 prior
- Inventories index: 47.3 v 46.5 prior
8:06:25 AM
(US) Fed's Lacker: Inflation rate is 'low'; commercial real estate to be a GDP drag; risk for double dip recession 'fairly low'
- reiterates 'extended period' language is appropriate
- natural beginning for exit strategy is with asset sales
Please read our disclaimer:
Trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the markets. The videos are neither a solicitation nor an offer to Buy/Sell futures or options. The past performance of any trading system or methodology is not necessarily indicative of future results.
Rule 4.41 - Hypothetical or simulated performance results have certain limitations. Unlike an actual performance record, simulated results do not represent actual trading. Also, since the trades have not been executed, the results may have under-or-over compensated for the impact, if any, of certain market factors, such as lack of liquidity. Simulated trading programs in general are also subject to the fact that they are designed with the benefit of hindsight. No representation is being made that any account will or is likely to achieve profit or losses similar to those shown. Learn to trade futures forex stocks.
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