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German IFO Stronger
2008-01-25 07:50:00
Market BriefUsd was mixed in European session. Usd was stronger against Jpy and Chf and weaker against the remainder G10 currencies as risk appetites increased with stock markets. Headline German business climate index rose to 103.4 vs. 102.3 exp. prior 103.0 reading. This is an encouraging sign that despite the recent turmoil in global markets, activity in the real German economy is holding up. US Initial Jobless Claims (Jan) dropped to 301k which is lower than what markets were expecting at 320k, however the market shrugged off this positive data leaving the Usd mostly unchanged.US equity market looks like they are going to follow the European market into positive territory as the momentum gains ground. US existing Home Sales and comments from ECB’s Trichet will rounds up this odd day.16:20gmt - ECB's Trichet speaks19:30gmt - Greenspan speaks on the US economy Global IndexesCurrent Level% Change FTSE 100 Index5,851.30+ 4.31 CAC 40 Index4,867.50+ 4.72 ...
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Major currencies continue to mirror global market sentiment
2008-01-25 07:46:00
On Wednesday, the single currency again traded as a kind of carry trade currency, at least in relation to the dollar and the yen. The poor performance of stock markets during the morning session in Europe and the losses at the open in the US made EUR/USD to give back half of Tuesday gains and pair reached an intraday low in the 1.4510-area. The gradual improvement of US stocks later in the session helped the pair to return above the 1.46 mark and the pair still trades in that area this morning. The European eco data (PMI, slightly better than expected) and the speech of Mr. Trichet had no lasting impact on trading. Today, the IFO business confidence will be on to the agenda. In the recent past, the IFO had no material impact on the currency market, but in the current juncture it deserves some more attention as it could impact the market expectations on the ECB interest rate path going forward. In the US, the claims and the existing home sales are on the agenda, but those series are...
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Price Stability Key To Econ Growth, Financial Stability
2008-01-24 19:58:00
Trichet: Price Stability Key To Econ Growth , Financial Stability DAVOS, Switzerland -(Dow Jones)- Price stability is critical to economic growth and the smooth functioning of financial markets, European Central Bank President Jean-Claude Trichet said Thursday.These responsibilities "call for the appropriate monetary policy stance," he said during a panel discussion at the World Economic Forum in Davos, Switzerland. "There is one needle in our compass, which is price stability," he added. The ECB currently faces an increasingly severe dilemma: euro-zone inflation is rising while economic growth is slowing.The bank so far has kept its key rate steady at 4.0%. The U.S. Federal Reserve, by contrast, has used steep interest rate cuts, including a 75-basis-point move Tuesday, to stave off a looming recession.Trichet noted that now is "no time for complacency" in preserving price stability and the smooth functioning of money markets.Financial-market turmoil continues to rock global marke...

Dollar hits 1-week low vs euro on risk
2008-01-24 19:57:00
LONDON (Thomson Financial) - The dollar fell to a one-week low against the euro as risk appetite picked back up again, boosting equity markets and reversing some of the recent trends which have benefited the dollar. Notably, the revelation today from Societe Generale that a single trader carried out a massive 4.9 bln eur fraud has calmed market fears of an impending global recession following the tumble on equity markets on Monday, with market players concluding that the SocGen fraud was largely to blame for the falls. "It appears the betting across most asset classes is leaning toward anticipating a shallow and short-lived US recession," said Randolph Donney at Thomson IFR Markets. Meanwhile, the dollar has also suffered after another set of weak US housing market data this afternoon contrasted with a stronger-than-expected German Ifo survey this morning. The news comes amid a growing feeling in the market that the Federal Reserve's aggressive interest rate cuts will not be emu...
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US existing home sales down 2.2 pct in December
2008-01-24 19:56:00
WASHINGTON (Thomson Financial) - Existing home sales in the US fell dramatically in December , and left 2007 as the worst year on record for US home sales and prices in almost four decades. The National Association of Realtors (NAR) said existing home sales were down 2.2 pct in December to a 4.89 mln unit annual rate. For all of 2007 they fell 12.8 pct to 5.65 mln units. Economists were predicting a 4.95 mln unit annual sales rate for December. The NAR also reported that 2007 had the first ever annual decline in the median price of existing homes since it began tracking the data combining condo and single-family home sales in 1998 -- down 1.4 pct to 218,900 usd. For single family homes exclusively, it was the first annual price decline since 1968, down 1.8 pct to 217,800 usd. Single family sales for the year fell 13 pct, their worst performance in 25 years. In just the month of December, single-family sales were off 2 pct to a 4.31 mln unit rate, with a 6.5 pct year-over-year pri...
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Treasurys mainly lower as stocks hold up
2008-01-24 19:52:00
NEW YORK (AP) - Treasury prices were mixed in uncertain trade Thursday as the stock market tried to extend a lively rebound into a second session. Treasury prices were volatile, alternating between fairly heavy gains and slight losses as the market adjusted to a sudden resumption of demand for stocks. Wall Street registered a considerable advance late in Wednesday's session. The gains in the stock market were smaller Thursday but largely eclipsed buying interest in Treasurys. The stock and government bond market often trade in opposite directions, as investors alternate between favoring safe assets like Treasurys and opting for the higher potential returns of riskier stocks. The 10-year benchmark note fell 9/32 to 104 31/32 with a yield of 3.64 percent, up from 3.60 percent late Wednesday. The 30-year long bond dropped 20 to 110 27/32 with a yield of 4.34 percent, up from 4.32 percent late Wednesday. The 2-year note fell 4/32 to 101 31/32 with a yield of 2.19 percent,...
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US Economic Indicators: Latest 6 Months Data-
2008-01-24 19:50:00
US Economic Indicators: Latest 6 Mont hs Data -Jan 24 Forecasts based on the projections from 20 economists as of Friday,Jan 18. NA = not available. E = estimate. R = revised. **** = tentative. --Forecast--Date Indicators :Median : Dec Nov Oct Sep Aug Jul01/24 Unemply Clms : 320:[1/19 301 [1/12 R 302R ] [1/5 322]01/24 Exist Hm Sls : 4.98: 4.89 5.00 4.98 5.03 5.48 5.7501/24 % change : : -2.2 0.4 -1.0 -8.2 -4.7 -0.201/25 % change : : -1.5 -7.2 -4.6 -4.8 -1.701/28 S/F Home Sls : NA : 647 711 699R 701R 79601/28 % change : : -9.0 1.7 -0.3R -11.9R -0.101/29 Durable Gds : : 214.7 214.5 215.3 218.4 230.501/29 % change : NA : 0.1 -0.4 -1.4 -5.3 5.901/29 NonDef Captl: : 75.9 73.0 74.9R 71.4 81.1...
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US Economic Indicators: DJ Survey Of Forecasters
2008-01-24 19:49:00
US Economic Indicators: DJ Survey Of Forecasters-Jan 24 Forecasts based on the projections from 20 economists as of Friday,Jan 18. NA = not available. E = estimate. R = revised. **** = tentative. Time --Forecast--Date EST Indicators Median Low High Prev Actual01/24 :0830: Unemploy Clms p/e Jan 19 : 320 305 330: 302R: 30101/24 :1000: Dec Existing Home Sales : 4.98 4.90 5.01: 5.00 : 4.8901/24 :1000: % change : : 0.4 : -2.201/25 :0830: % change : : -1.5 :01/28 :1000: Dec S/F Home Sales : NA NA NA : 647 :01/29 :0830: Dec Durable Goods (% chg) : NA NA NA : 0.1 :01/29 :1000: Jan Consumer Confidence : NA NA NA : 88.6 :01/30 :0830: Q4 Adv GDP : NA NA NA : 4.901/30 :0830: Final Sales Dom Prchsr : NA NA NA : 5.1 :01/30 :0830: PCE Defltr : ...
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IMF delays release of world economic outlook, financial stability report
2008-01-24 19:48:00
WASHINGTON (Thomson Financial ) - The IMF announced today that it will delay until the middle of next week its release of updates to the World Economic Outlook and Global Financial Stability Report . The IMF said it postponed the release, originally scheduled for Friday, in order to evaluate the current economic stiuation and incorporate any additional data into its forecast.
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European govt bonds sharply lower as equities continue rally
2008-01-24 19:47:00
LONDON (Thomson Financial) - European government bonds remained sharply lower, pressured by a reversal in safe haven flows as equity markets continued to rally higher. European stock markets have staged a massive comeback today from the substantial losses suffered earlier this week, following a dramatic turnaround in the US last night, although Wall Street has struggled to sustain gains today. "Fundamentals have been put on the sidelines this week ... attention is very much focusing on the equity markets after the sell-off in safe haven gains that we'd seen in bonds from Monday," said Audrey Childe-Freeman, senior European economist at CIBC World Markets. She added that European bonds are also suffering from the diverging interest rate expectations in the US, where the Fed has been aggressively pushing them down, and the euro zone where the central bank is still reluctant to consider reductions at all. "Yield levels were not realistic or consistent with the outlook for inter...
More About: Rally , Bonds , Lower , Equities

UK money market rates
2008-01-24 19:46:00
INTERBANK OFFERED RATES OVERNIGHT 5.52 1 WEEK 5.54 1 MONTH 5.53 2 MONTHS 5.53 3 MONTHS 5.53 4 MONTHS 5.51 5 MONTHS 5.48 6 MONTHS 5.45 9 MONTHS 5.36 12 MONTHS 5.27 DEPO CDs 1 MONTH 5.53 - 5.45 2 MONTHS 5.54 - 5.46 3 MONTHS 5.55 - 5.47 4 MONTHS 5.51 - 5.43 5 MONTHS 5.49 - 5.31 6 MONTHS 5.46 - 5.38 9 MONTHS 5.37 - 5.27 12 MONTHS 5.28 - 5.18 CLEARER CDs 1 MONTH 5.53 - 5.45 2 MONTHS 5.54 - 5.46 3 MONTHS 5.55 - 5.47 4 MONTHS 5.51 - 5.43 5 MONTHS 5.49 - 5.31 6 MONTHS 5.46 - 5.38 9 MONTHS 5.37 - 5.27 12 MONTHS 5.28 - 5.18 LOCAL AUTHORITY DEPOSITS 2 DAYS 5.48 7 DAYS 5.47 1 MONTH 5.45 3 MONTHS 5.45 6 MONTHS 5.40 12 MONTHS 5.25 EURODOLLAR DEPOSIT OVERNIGHT 3.56 - 3.50 7 DAYS 3.50 - 3.45 1 MONTH 3.30 - 3.20 3 MONTHS 3.35 - 3.25 6 MONTHS 3.13 - 3.03 12 MONTHS 2.90 - 2.80 EURODOLLAR CDs 1 MONTH 3.17 3 MONTHS 3.15 6 MONTHS 3.06 12 MONTHS 2.85 Local authority rates provided by Tradition
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Oil firm as US reports stocks rose
2008-01-24 19:44:00
LONDON (Thomson Financial) - Oil prices held firm as US crude stocks rose in line with expectations last week. Prices were some way off their day highs, however, as gasoline inventory rose higher than expectations and as oil remained vulnerable to wider financial market weakness. Though more positive sentiment on the stock markets today had lifted oil's value by over a dollar earlier in the session, analysts said prices were still vulnerable to another push lower. New York's main benchmark has lost around 12 pct since hitting a record 100.09 usd per barrel in the first week of January. On Tuesday, the Federal Reserve unexpectedly slashed a key interest rate by a bold three-fourths of a percentage point on Tuesday, responding to a global plunge in stock markets that heightened concerns about a recession. The Fed signalled that further rate cuts were likely. "We continue to see the urgent action more as confirmation that the economy is definitely slowing than as an immediat...
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Benjamin Securities President: Market May Recover In 1st Half '08
2008-01-24 19:40:00
TALK BACK:Benjamin Securities President : Market May Recover In 1st Half '08 The comment below responds to the question we posed on Dow Jones NewsPlus: What are you telling your clients in this market? Please share your own views. Email us at TalkBackAmericas@dowjones.com. Here's what Leo J. Benjamin, president of Benjamin Securities Inc., writes:Looking ahead to 2008, with the U.S. dollar reaching unprecedented low exchange values (i.e., 1 Eurodollar converts into US$1.48), the popular saying is "the U.S. is on sale."For example, I believe it will only be a matter of time for European investors to realize that they can invest 1 Eurodollar and immediately get US$1.48 worth of stock in AT&T Inc. (T). Money is expected to flow into the U.S. in the form of mergers, acquisitions, tourist trade, consumer goods, and investments in U.S. securities from foreign corporations and overseas individuals.On the other side of the coin, many U.S. companies will seek to sell their products and...

China central bank drains 29 bln yuan via paper sale
2008-01-24 04:56:00
BEIJING (XFN-ASIA) - The People's Bank of China (PBoC) said it drained 9 bln yuan from the banking system via the sale of three-year bank bills in open market operations today. The bank said in a statement on its website that the yield on the paper stood at 4.56 pct, unchanged from last week. A further 20 bln yuan worth of three-month central bank bills yielded 3.4071 pct, also unchanged from last week. The bank also drained 22 bln yuan out of the banking system via seven-day repos and 12 bln via 28-day repos. The central bank carries out regular open-market operations on Tuesdays and Thursdays. (1 usd = 7.3 yuan)
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Japanese government bonds end morning lower as stocks continue rebound
2008-01-24 04:53:00
TOKYO (Thomson Financial) - Japanese government bond prices ended the morning session lower Wednesday as the continued rebound on the stock market encouraged investors to lock in profits on the recent surge. But the top-heaviness on the Tokyo stock market encouraged investors to buy bargain bonds, supporting the downside. The benchmark Nikkei 225 Stock Average finished the morning up 184.86 yen or 1.4 percent at 13,013.92, off a high of 13,134.77. "It is still difficult for us to see a fully-fledged upturn in the stock market," said Makoto Yamashita, a Lehman Brothers strategist. "So we will continue to recommend buying bonds, as the correction is seen as a blip," he said. Speculation about an interest rate cut in Japan is also keeping bond prices from falling too far. There is an increasingly widespread view that the Bank of Japan is now open to the possibility of rate cuts in coordination with the US and euro-zone central banks in the event of another acceleration i...
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pressure on prices is increasing
2008-01-24 04:52:00
BEIJING (XFN-ASIA) - Upward price pressures are increasing and China's economy still faces the risk of overheating, the National Bureau of Statistics (NBS) said. The consumer price index rose 4.8 pct in 2007 with a 6.5 pct increase year-on-year in December. The NBS also said in a statement that China will seek to rebalance growth in its economy and open it up to foreign participation. It did not provide details. bjburo@xfn.com
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Oil prices higher in mid-morning Asian trade
2008-01-24 04:52:00
SINGAPORE (Thomson Financial) - World oil prices rebounded in mid-morning Asian trade on Thursday after plunging over continued fears for the US economy despite an emergency interest rate cut by the Federal Reserve. The oil market has been dogged by fears in recent weeks that a US-led global economic slowdown could crimp world demand for energy. In early morning trade, New York's main contract, light sweet crude for delivery in March, rose 94 cents to 87.93 dollars a barrel. The contract closed down 2.22 dollars at 86.99 dollars per barrel Wednesday, marking its lowest point in several weeks. Brent North Sea crude for March delivery rose 88 cents to 87.50 dollars a barrel after settling down 1.83 dollars at 86.62 dollars per barrel in London on Wednesday. New York oil prices have shed about 12 percent since striking a record high of 100.09 dollars at the start of January. In an unexpected move Tuesday, the Fed slashed its key interest rate by an unprecedented 75 basis p...
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The Measure of Economic Weakness
2008-01-24 04:49:00
How does the National Bureau of Economic Research (NBER), the officialarbiter of U.S. business cycles, determine the beginning and end of arecession? A peak in the business cycle marks the end of an expansion andthe beginning of a recession. The traditional role of the committee is tomaintain a monthly chronology so they refer almost exclusively to monthlyindicators. As a result of this monthly focus, the committee gives relativelylittle weight to real GDP, which is only measured quarterly and subject tocontinuing, large revisions. The broadest monthly macroeconomicindicator is employment. The committee also generally studies anothermonthly indicator of economy-wide activity, real personal income lesstransfer payments (top graph) adjusted for price changes. In addition, thecommittee refers to two indicators with coverage of manufacturing and thebroader sales and distribution of goods: (1) industrial production (middlegraph) and (2) the volume of sales of the manufacturing and trade ...

Emerging Markets: Next in line
2008-01-24 04:46:00
As the global equity markets are in a free fall, the risk of Emerging Markets turmoil has clearly increased. It is notable that it looks as if global investors – rightly or wrongly – are loosing faith in the rest of the world’s ability decouple from the US slowdown. For example, this is visible in commodity prices, which have fallen somewhat overnight. Crude oil is now at a five-week low.The continued rise in risk aversion is likely to hit high beta currencies such as TRY, ZAR, ISK, RON and HUF mostly. Furthermore, with commodity prices beginning to fall also, it is likely that the Latin American currencies – particularly BRL and CLP – are likely to come under further selling pressure. In general we see most risk in the EMEA currencies where external imbalances are large.It should be noted that a lot of investors have been betting on the notion that Emerging Markets were “special ” and could act as a “safe haven”. That view might now no longer be the dominant one, and hence...
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Yen Rallies As Risk Aversion Grips Market
2008-01-23 15:39:00
NEW YORK (Dow Jones)--Risk aversion has gripped currency markets early Wednesday in New York, with the yen rallying against the dollar and euro.The Federal Reserve's emergency inter-meeting interest rate cut Tuesday afforded only limited relief to markets, and they are back in risk-averse mode. The dollar recently reached a fresh two-and-a-half year low versus the yen at Y104.95. The euro also fell to Y152.79 - not as low as before the rate cut Tuesday, in the wake of the frenzy in global equities a day earlier on fears of a U.S. recession.The higher-yielding currencies, such as the euro, are suffering at the hands of the lower-yielding yen and dollar due to the unwind of riskier carry trade positions, wherein investors borrow lower-yielding currencies to fund bets in riskier assets - what's known as the "carry trade."The rate cut "isn't going to forestall further adjustments to currency markets," with a resumption of equity market weakness and yields plunging, said John McCarthy...
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Norwegian central bank keeps rates on hold
2008-01-23 15:37:00
(Adds analyst reaction, crown reaction)OSLO (Thomson Financial) - Norway's central bank kept its key interest rate on hold at 5.25 pct, as expected, in a decision economists said recognised that the oil-producing nation's economy remains very strong despite growing indications of a global economic slowdown.Deputy Governor Jarle Bergo said consumer prices had increased at a faster pace than expected and growth in the Norwegian economy remained strong."Inflation picked up faster than expected in December and growth in the Norwegian economy is strong, but in view of the weak developments in the external environment and the turbulence in financial markets, it is now on balance appropriate to leave the key policy rate unchanged," Bergo said in a statement.Bergo said CPI inflation moved up to 2.8 pct in December, partly reflecting high electricity prices. Other inflation measures ranged between 1.75 pct and 2.5 pct, also higher than expected.Analysts, reacting to the decision, said it w...
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