Monday, 30 July 2012

July 30, 2012 Financial Market Summary


DJIA soared 1.5% to settle at 13,075.7. NASDAQ jumped 2.2% to close at 2,958.1. S&P 500 surged 1.9% to end at 1, 386.0.
Nikkei 225 index is trading 0.6% higher at 8,619.8.

FTSE 100 gained 1.0% to close at 5,627.2.
FTSEurofirst 300 index added 1.3% to 1,056.5.

In Asia, crude oil for September delivery is trading 0.7% or $0.62 higher at $90.75 per barrel.
At 0400 BST today, the GBP is trading 0.1% lower against the USD at $1.5714, 0.1% higher against the EUR at €1.2788, and 0.4% lower against the JPY at ¥123.15.

US Market Snapshot
US markets rose sharply on Friday, as GDP data for the second quarter of 2012 matched market expectations and as Eurozone fears eased, amid signs of actions by the European leaders to address the region’s debt troubles. Hopes of further stimulus from the Federal Reserve and the ECB also underpinned the gains. Pharmaceutical company, Merck rallied 4.1%, as its second-quarter earnings surpassed market estimates. Amazon.com jumped 7.9%, as its second-quarter operating income exceeded the past company guidance, while Expedia, up 20.1%, also benefited from its better-than-expected second quarter results. Chevron added 0.9%, as its second quarter earnings topped expectations. Financials, American Express, Travelers, Bank of America and JP Morgan Chase rallied between 1.3% and 3.0%, amid news that German and French leaders had made a pledge to protect the Eurozone at all costs.

DJIA soared 1.5% to settle at 13,075.7. NASDAQ jumped 2.2% to close at 2,958.1. S&P 500 surged 1.9% to end at 1, 386.0.

Asian Market Snapshot
Asian stock markets are trading higher this morning, amid hopes that the Federal Reserve and the ECB would adopt dovish monetary policies to stimulate growth and on optimism that the European lawmakers would come up with solid measures to support the euro. In Japan, Fujifilm Holdings, IHI Corp and Konica Minolta Holdings are trading higher, following their upbeat first-quarter results. In Hong-Kong, shares of HSBC Holdings gained, ahead of its quarterly earnings results, scheduled to be released later in the day. Bank of China and China Construction Bank paced gains, as risk sentiment improved across the board. In South Korea, Samsung Heavy Industries and Hyundai Heavy Industries climbed.

Nikkei 225 index is trading 0.6% higher at 8,619.8. Kospi index is trading 0.8% higher, at 1,844.0. Hang Seng index is trading 1.4% higher, at 19,537.2.

UK Market Snapshot
UK markets rallied on Friday, as reports surfaced that the ECB may buy Spanish and Italian bonds and after US economic data marginally beat market expectations. Barclays jumped 8.7% and emerged as the top gainer in the FTSE 100 index, as it posted forecast-beating half-year profits, while Lloyds Banking Group gained 3.7%, boosted by favourable comments from RBC and UBS. Miners, BHP Billiton, ENRC, Rio Tinto and Vedanta Resources rallied between 1.7% and 3.1%, tracking a rise in metal prices. SABMiller rose 1.4%, after S&P Equity Research upgraded its rating on the stock to “Hold” from “Sell” and increased its target price for the stock.  Commodities bellwether, Glencore International rose 1.6%, as it inched closer to completion of its £3.9 billion takeover of Canadian agricultural grain handler, Viterra, following approval by Australian authorities.

FTSE 100 gained 1.0% to close at 5,627.2, while FTSE 250 surged 1.3% to end at 11,179.0.

European Market Snapshot
Other European markets closed higher on Friday, as investors speculated that the ECB would announce fresh measures to reduce Italy and Spain’s borrowing costs, following upbeat comments from ECB President Mario Draghi, French President Fran├žois Hollande and German Chancellor Angela Merkel, who all pledged to safeguard the Eurozone. Daimler added 2.8%, after it reported a 10.0% jump in its second-quarter sales. Amongst other automakers, Renault, BMW, Peugeot and Volkswagen advanced between 0.4% and 6.4%. Banking stocks, Societe Generale, BNP Paribas, Deutsche Bank and Commerzbank jumped between 1.8% and 6.1%, as risk appetite among investors increased. European Aeronautic Defence & Space gained 5.7%, after it revealed stronger-than-expected second-quarter earnings.

FTSEurofirst 300 index added 1.3% to 1,056.5. German DAX Xetra 30 rose 1.6% to 6,689.4. French CAC-40 closed 2.3% higher, at 3,280.2

Commodities
In Asia, crude oil for September delivery is trading 0.7% or $0.62 higher at $90.75 per barrel. On Friday, crude oil for September delivery gained 0.8% or $0.74 to $90.13 per barrel, amid rising hopes that the European Central Bank (ECB) and the US Federal Reserve would take further steps to support economic growth. However, gains were capped, after a report indicated that US economic growth slowed in the second-quarter of 2012.

Gold for immediate delivery is trading 0.1% lower today, at $1,621.20 per ounce. Gold for August delivery settled up 0.2% or $2.90 at $1,618 per ounce on Friday, amid optimism of more stimulus measures from the ECB and Federal Reserve. However, gains were limited, as the dollar managed to claw back some of its losses against the euro and the yen.

Currencies
At 0400 BST today, the GBP is trading 0.1% lower against the USD at $1.5714, 0.1% higher against the EUR at €1.2788, and 0.4% lower against the JPY at ¥123.15.

The EUR is trading 0.2% lower against the USD at $1.2288 and 0.5% down against the JPY at ¥96.30, ahead of a report due today which is expected to show that consumer confidence in the Eurozone dropped in July. The EUR also fell, amid concerns that a report due tomorrow might show that unemployment in the region climbed to a record in July, and after Moody’s Investors Service, in its Credit Outlook, indicated that the ECB’s commitment to preserve euro is not sufficient to resolve the sovereign debt crisis.
The Soutine Korean WON is trading lower against the USD, after data showed that South Korean manufacturers’ confidence fell to the lowest level in more than three years in July.

On Friday, the EUR ended higher against the USD, after German Chancellor Angela Merkel and French President Francois Hollande, in a joint statement, stated that they would do “everything” necessary to protect the European common currency. The EUR also rose, after the French daily Le Monde reported that the ECB and Eurozone governments would be buying Spanish and Italian debt. However, gains were capped, after the German central bank stated that it remained critical of the ECB's bond-buying program and reiterated its opposition to giving a banking license to the Eurozone's bailout fund.
The USD ended lower against the EUR and the GBP, after a government report showed that US economic growth slowed in the second-quarter of 2012, boosting speculation of further monetary easing by the Federal Reserve.

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