Veterans day in the US is a holiday but stock and other markets remained open in the US overnight although you would be hard pressed to notice given the very tight ranges. Certainly Asia had an interesting session after the weak Japanese GDP data was released juxtaposing the better Chinese data from the weekend. We saw new lending data released which showed that new loans fell 14% from a year ago which is a bit of a concern.
The big news overnight after the settlement between Apple and HTC was that Samsung hit Apple with a 20% price rise on its processors which knocked Apple shares a little but otherwise we saw enduring concerns about Greece and a report that the embattled country will need an extra €15 billion by 2014.
At the close of play, European stocks were largely unchanged mixed with the FTSE off 0.04%, the DAX up 0.07% while the CAC continues to be the volatile one of the three big European markets falling 0.35%. Madrid came under pressure again falling 0.87%.
I know that conventional wisdom is that Spain will have to ask for a bail out eventually but it seems that the reason why Spanish PM Rajoy is dragging his feet was apparent in his decision to forestall foreclosures over the weekend after the suicide of an evictee. When or if Rajoy asks for help he will most likely lose the ability to institute such simple but important reactions to the impact of his austerity – he can see how Greece is going and has gone with the ceding of a lot of its fiscal sovereignty – why exactly would he need to tread that path if he can muddle through?
In the US in fairly quiet trade the S&P 500 is down 0.01% to 1380, the Dow is down 0.01% and the NASDAQ down 0.06% at 7.25 35 minutes before the close.
In commodity markets there is an interesting story this morning that the US is going to become the world’s biggest oil producer for about 15-20 years from 2017 due to the unlocking of the shale oil and gas according to the International Energy Agency. Certainly an interesting prediction if it comes true with massive geo-political implications.
Overnight however Nymex crude was a little lower off 0.26% to $85.85 Bbl. Gold was 0.18% higher at $1733 oz and silver outpaced the yellow metal once again rising 1.11% to $32.66 oz. The Ags got smashed after the announcement on Friday of a bigger harvest saw prices trade through range bottoms and the technical selling has accelerated the move lower. Soybeans were down 2.41% and is almost at the target we set on the break Friday, wheat fell 3.19% and corn was off 2.81%. There could be a trade on corn and or wheat as they have yet not broken down through their range bottom.
Tight ranges overnight in Global FX markets. The euro sits at 1.2709 this morning after trading in a 1.2695-1.2739 range over the past 24 hours and is roughly unchanged on that time frame. GBP on the other hand is starting to look very weak – granted it hasn’t yet broken the important 200 day moving average at 1.5845 but it is not too far off at the moment sitting at 1.5872. AUD is strong as an ox still but hasn’t really gone anywhere since it tried to break higher last week.
Lets have a look at some Meta 4 charts from my AVATrade platform.
EUR/USD: Quiet trade for the EUR but overall it remains under pressure. Support is at 1.2600 and then below 1.25 at 1.2472 which is the 61.8% retracement of the recent rally. We could see a bounce at some stage but the overall trend looks to be still pointed lower:
AUD/USD: Whereas most other currencies are unchanged or weaker against the US dollar the Aussie is up 0.38% to 1.0424 after a high on the 61.8% retacement level of the September/October sell-off. As you can see below it is a messy, trendless market for the AUD at the moment.:
Data: In New Zealand we get the food price index this morning before UK RICS house prices and the NAB Business survey (the only economic data you really need to know for Australia I reckon). Japan has industrial production and capacity utilization to follow up on yesterday’s GDP data and then tonight we have a raft of price data in the UK and Europe along with the German ZEW survey of economic sentiment. Some minor data in the US such as the NFIB business optimism index and Redbook index.
Here is how the markets looked at 7.11 this morning.
Twitter: Greg McKenna.
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