August 21, 2012 Financial Market Summary

At 0500 BST today, FTSE 100 futures are trading 1.6 points higher.

At 0500 BST today, German DAX Xetra 30 futures are trading 2.4 points higher, while French CAC-40 futures are trading 4.7 points higher.

At 0500 BST today, DJIA futures are trading 5.0 points higher.

Nikkei 225 index is trading 0.1% higher at 9,183.3.

In Asia, crude oil for September delivery is trading marginally lower at $95.94 per barrel.

At 0400 BST today, the GBP is trading 0.1% higher against the USD at $1.5719, slightly higher against the EUR at €1.2721, and 0.1% higher against the JPY at ¥124.74.

US Market Snapshot

At 0500 BST today, DJIA futures are trading 5.0 points higher.

Yesterday, DJIA slid marginally to settle at 13,271.6. NASDAQ slipped marginally to end at 3,076.2. S&P 500 remained unchanged at 1,418.1.

US markets ended flat, with the DJIA ticking down for the first time in three sessions, as concern about the European debt crisis offset a rally in technology and financial sector companies. Investors also looked ahead to the minutes from the Federal Reserve’s last meeting.

Apple gained 2.6%, amid continued speculation of launch of new iPhone and iPad products.  Citigroup rallied 3.3%, as its Chief Executive, Vikram Pandit, rejected calls for bank split. Facebook gained 5.0%, after Capstone Investments upgraded the shares to “Buy” from “Hold”.

JP Morgan Chase gained 1.1%, as it choose veteran Lee Raymond to lead a board committee to probe the bank’s massive trading loss.

However, Hibbett Sports dropped 5.0%, as it was downgraded by Raymond James to “Market Perform” from “Out-perform”.

In extended hours trading, Urban Outfitters jumped 17.5%, as its second-quarter profit came ahead of market expectations. DreamWorks Animation advanced 1.6%, as it entered into a new five-year distribution agreement with Twentieth Century Fox.

Asian Market Snapshot

Asian markets are trading higher this morning, amid expectation of upbeat housing and durable goods data from the US later this week. However, gains were limited as investors waited for more concrete details on potential action from the European Central Bank.

In Japan, Nintendo climbed as it released its 3DS XL portable game system in the US. Fujitsu climbed, following an upgrade to “Buy” from “Neutral” at Citigroup.

In Hong Kong, PICC Property and Casualty traded higher, as it reported a 23.6% rise in its half-year net profit. Tingyi Cayman Islands Holding paced gains as it posted robust half-yearly results.

In South Korea, SK Hynix gained ground on expectation that DRAM prices would rebound and stabilize in the second half of 2012.

Nikkei 225 index is trading 0.1% higher at 9,183.3. Hang Seng index is trading marginally higher at 20,106.8. Kospi is trading 0.4% higher at 1,953.8.

UK Market Snapshot

At 0500 BST today, FTSE 100 futures are trading 1.6 points higher.

Centrica stated that its South Morecambe gas field has again started production after it was suspended recently on UK government’s decision to raise offshore drilling taxes.

Royal Dutch Shell entered a swap deal with Chevron to transfer its interest in the $29 billion Wheatstone project and pay $450 million to Chevron. In return, Chevron would transfer its interest in the proposed $30 billion-plus Browse project to the company.

European Market Snapshot

At 0500 BST today, German DAX Xetra 30 futures are trading 2.4 points higher, while French CAC-40 futures are trading 4.7 points higher.

Volkswagen has put its new product development and emissions test laboratory in Oxnard, California, in operation. The carmaker invested $27 million in the facility and plans to employ 50 people initially.

According to a press release from the stock exchange, Lagardere has offered to buy the remaining shares of LeGuide.com.

Commodities

In Asia, crude oil for September delivery is trading marginally lower at $95.94 per barrel.

Yesterday, crude oil for September delivery fell $0.04 to $95.97 per barrel, snapping its four-session winning streak, amid concern Germany’s Bundesbank would not support the ECB's plan to embark on potentially "unlimited" government bond purchases.

However, losses were capped, amid lingering concern that geopolitical tensions in Middle East would disrupt crude oil supply.

Gold for immediate delivery is trading 0.1% higher today, at $1,622.00 per ounce.

Gold for December delivery settled up 0.2% or $3.60 at $1,623.00 per ounce yesterday, as investors looked ahead to the minutes of the US Federal Reserve’s August policy meeting, amid rising speculation of another round of stimulus measures.

Yesterday, copper 3-month futures fell 0.9% or $66.0, to close at $7,442.00 /MT. Aluminium 3-month futures dropped 0.6% or $10.0, to close at $1,745.00 /MT.

Currencies

At 0400 BST today, the GBP is trading 0.1% higher against the USD at $1.5719, slightly higher against the EUR at €1.2721, and 0.1% higher against the JPY at ¥124.74.

The EUR is trading marginally higher against the USD at $1.2357. The EUR is trading 0.1% higher against the JPY at ¥98.06.

The EUR is trading higher against its major counterparts, as Spain’s benchmark yields slid to a seven-week low and ahead of Luxembourg Prime Minister Jean-Claude Juncker’s visit to Greece tomorrow to discuss the country’s request for an extension to its fiscal adjustment program.

The WON rose against the USD as overseas investors boosted their holdings of South Korean stocks and exporters repatriated income to take advantage of the more favorable exchange rate.

The AUD is trading higher against the USD, after minutes of the Australia’s Reserve Bank last meeting indicated that policy makers see domestic growth overshadowing a “fragile” global outlook.

Yesterday, the EUR ended higher against the USD, amid scope of possible ECB action to contain the region's debt crisis. However, earlier in the trading session, the EUR capped its advance against the USD and dropped against the JPY, after Germany's central bank reiterated its opposition to the ECB’s plan to purchase government bonds. The ECB dismissed a report as "absolutely misleading" which had stated that the ECB planned to set a cap on the borrowing costs of debt-laden eurozone countries.

Macroeconomic Snapshot

Markit Economics reported that the household finance index in the UK rose to a reading of 38.9 in August, compared to a reading of 37.5 recorded in July.

The Council of Mortgage Lenders (CML) reported that on a month-on-month basis, the gross mortgage lending in the UK increased by 8.0% to £12.7 billion in July.

On a seasonally adjusted monthly basis, construction output in the eurozone dropped 0.5% in June, compared to a revised 0.2% decline recorded in the previous month.

The Federal Reserve Bank of Chicago reported that the national activity index rose to a reading of -0.13 in July, from a revised reading of -0.34 recorded in the previous month.

Japan’s leading index was revised up to a reading of 93.2 in June from an initially estimated reading of 92.6.

Source: www.etxcapital.com