August 20, 2012 Financial Market Summary

At 0500 BST today, FTSE 100 futures are trading 6.6 points lower.

At 0500 BST today, German DAX Xetra 30 futures are trading 5.4 points higher, while French CAC-40 futures are trading 1.1 points lower.

At 0500 BST today, DJIA futures are trading 2.0 points higher.

Nikkei 225 index is trading 0.6% higher at 9,218.0.

In Asia, crude oil for September delivery is trading 0.2% or $0.21 higher at $96.22 per barrel.

At 0400 BST today, the GBP is trading marginally lower against the USD at $1.5689, flat against the EUR at €1.2721, and 0.1% higher against the JPY at ¥124.85.

US Market Snapshot

At 0500 BST today, DJIA futures are trading 2.0 points higher.

On Friday, DJIA edged up 0.2% to settle at 13,275.2. NASDAQ rose 0.5% to end at 3,076.6. S&P 500 ticked up 0.2% to close at 1,418.2.

US stocks edged up to multi-year highs, with the DJIA hitting its best level since 2007, as August preliminary reading showed that domestic consumer sentiment ticked up to its highest level since May.

MetroPCS Communications jumped 5.1%, amid talks of consolidation in the wireless telecom sector. Gap advanced 4.8%, as it reported better-than-expected second-quarter earnings and raised its full-year guidance.

Caterpillar added 1.6%, as workers at an Illinois plant ratified a six-year labour agreement, ending a nearly four-month strike. Apple added 1.9%, after Jefferies reiterated its “Buy” rating on the stock.

Nokia rallied 3.8%, after it stated that it would offer Zynga games on its touch devices.

In extended hours trading, Facebook dipped 0.2%, amid growing concerns about the impact of 271 million Facebook shares that hit the market on Thursday following the expiration of IPO lockups.

Asian Market Snapshot

Asian markets are trading mostly lower this morning, as concern that China would tighten property curbs following a rise in home prices for July, overshadowed optimism after consumer confidence in the US rose better-than-expected.

In Japan, exporters Honda Motor, Mazda Motor, Panasonic, Pioneer and Advantest paced gains, as the yen depreciated against the dollar.

In Hong Kong, Guangzhou R&F Properties slipped amid concern China would refrain from conducting further policy easing following Chinese real-estate prices data.

In South Korea, Samsung Electronics fell, amid profit-booking amongst investors. STX Offshore & Shipbuilding fell on dilution fears amid report part of the STX Group was planning to issue bonds with warrants to shore up liquidity.

Nikkei 225 index is trading 0.6% higher at 9,218.0. Hang Seng index is trading 0.9% lower at 19,936.7. Kospi is trading 0.3% lower at 1,940.7.

UK Market Snapshot

At 0500 BST today, FTSE 100 futures are trading 6.6 points lower.

BHP Billiton has entered into a native land agreement in the Pilbara region with the Nyiyaparli people. The company expects this deal to increase expansion of its iron ore operations and boost its output to 350 million tonnes by 2020 from the current 120 million tonnes.

Prudential plans to double its sales force in China as it believes Chinese people are keen to buy their own health insurance on the back of increasing worries over pension reform.

European Market Snapshot

At 0500 BST today, German DAX Xetra 30 futures are trading 5.4 points higher, while French CAC-40 futures are trading 1.1 points lower.

In the US, the Federal Reserve, the Justice Department and the Manhattan district attorney’s office are investigating against Deutsche Bank for alleged violations of Iran sanctions.

French investment bank Rothschild is planning to launch a €400 to €500 million fund in September that would finance small and medium-sized European companies due to increasing scarcity of traditional bank loans.

Commodities

In Asia, crude oil for September delivery is trading 0.2% or $0.21 higher at $96.22 per barrel.

On Friday, crude oil for September delivery gained 0.4% or $0.41 to $96.01 per barrel, amid expectations of increase in energy demand in future, following better-than-expected US consumer sentiment data for August.

Lingering worries over supply disruption in Middle East region and maintenance issues on North Sea oil rigs also pushed oil prices higher. However, gains were capped, on reports that US government might release some stocks from its Strategic Petroleum Reserve and as dollar traded higher against the euro.

Gold for immediate delivery is trading 0.1% higher today, at $1,619.05 per ounce.

Gold for December delivery settled up $0.20 at $1,619.40 per ounce on Friday, partly supported by prior-day news that Spain is prepared to request an emergency disbursement from the €100 billion bailout package.

However, gains were limited, as the dollar strengthened against the euro and as upbeat US consumer sentiment data dampened expectations of further monetary stimulus by US Federal Reserve.

On Friday, copper 3-month futures rose 1.5% or $111.0, to close at $7,508.00 /MT. Aluminium 3-month futures gained 0.3% or $5.0, to close at $1,755.00 /MT.

Currencies

At 0400 BST today, the GBP is trading marginally lower against the USD at $1.5689, flat against the EUR at €1.2721, and 0.1% higher against the JPY at ¥124.85.

The EUR is trading slightly higher against the USD at $1.2333. The EUR is trading 0.1% higher against the JPY at ¥98.15. The EUR is trading higher, after Germany’s Spiegel magazine reported that the ECB’s governing council might decide at its next gathering to set yield limits on each country’s debt.

The USD is trading higher against the JPY, ahead of the release of the US Federal Reserve’s latest meeting minutes this week. Earlier in the trading session, the USD traded higher against most of its major currencies, amid fading speculations of additional monetary easing by the US Federal Reserve. Reports this week are expected to show home sales and orders for durable goods climbed in July, adding to signs US economic recovery is gathering pace.

On Friday, the USD ended higher against the EUR and other major counterparts, after a report revealed that US consumer sentiment improved unexpectedly in August to its highest level in three months.

The EUR closed lower against the USD, after reports revealed that German producer price inflation slowed to two-year low in July and French leading economic index dropped for the third consecutive month in June. However, separate reports indicated that eurozone current account surplus widened unexpectedly in June. 

The GBP closed marginally higher the EUR, as a string of positive UK economic data earlier in the week suggested that the economy might not be as weak as previously forecasted.

Macroeconomic Snapshot

Rightmove reported that, on an annual basis, house prices in the UK rose 2.0% in August, following a 2.3% increase recorded in July.

Knight Frank and Markit Economics reported that the house price sentiment index in the UK dropped to a reading of 44.5 in August, from 45.6 recorded in July.

On a yearly basis, the producer price inflation in Germany eased to 0.9% in July, compared to a 1.6% growth recorded in June.

On a sequential basis, the leading economic index in France fell 0.3% to 113.0 in June, compared to a 0.2% fall in the previous month.

On a seasonally adjusted basis, current account surplus in the eurozone surged to €12.7 billion in June, compared to a revised surplus of €10.3 billion recorded in May.

The Conference Board reported that on a monthly basis, its leading economic index in the US rose 0.4% to 95.8 in July, compared to a revised 0.4% drop recorded in June.

Source: www.etxcapital.com