Wednesday, February 10, 2016
The dollar weakens near 3-1/2-month low against a basket of major currencies on Wednesday, as traders awaits the announcement of U.S. interest rate guidance from Federal Reserve Chair Janet Yellen. It was also affected by fears of a global economic slowdown amid the recent falls in oil prices and growing concerns about the health of European banks.
Experts said that because of those difficulties, the U.S. Federal Reserve will not raise interest rates in the near future. Traders are also looking to Fed Chair Janet Yellen's congressional testimony later in the day for clues on the outlook for policy.
Against a basket of currencies the dollar was flat at 96.056 .DXY, having touched 95.663 on Tuesday, its weakest since October.
The low represented a 4.8% decline from its 12-1/2-year peak touched in early December when the consensus was for the Fed to keep raising rates this year, stoking a global capital rush of funds to higher-yielding dollar assets.
The dollar's fall has been most notable against the yen, which had been depressed at low levels over a long period because of the Bank of Japan's aggressive monetary easing since 2013.
The dollar fell 0.7% to 114.37 yen , not far from its 15-month low of 114.205 yen hit on Tuesday.
A fall in Japan's benchmark Nikkei share average <.n225> to its lowest levels since October 2014 helped spur demand for the safe-haven yen, analysts said.
Such weakness in Japanese equities could dampen Japanese investors' risk appetite and weigh on the dollar versus the yen in coming months, said Masashi Murata, currency strategist for Brown Brothers Harriman in Tokyo.
The euro were steadfast at $1.1295, they've hit a 3-1/2 month high of $1.13385 on Tuesday.
Friday, February 5, 2016
- Nikkei extends losses for fifth day, down 5.9% for the week
Asian markets were on the downside on Friday, closing mixed despite a positive finish on Wall Street overnight, as a newly weaker dollar brought fresh concerns ahead of the closely watched U.S. jobs report. The U.S. dollar basket has lost 3.2% since the close on Friday and 2.3% in just two days, with Wednesday being the worst single day in DXY in seven years.
The dollar index, where the dollar is weighted against a basket of currencies, was at 96.58.
Shanghai stocks, was slightly up by 0.2% while Australian shares dipped by 0.1%. Japan's Nikkei under performed, dropping 1.4% and headed for its fourth straight day of losses.
The biggest concern for the Japanese market now is whether the dollar will weaken against the yen further. You don't know how U.S. stocks will perform after the jobs data release, so most investors are nervous.
Hong Kong's Hang Seng bounce by 0.8% while other gainers included Malaysian and Singapore shares.
The euro were down 0.2% to $1.1188, trimming some of the gains from Thursday's surge. The common currency was headed for a 3.3% gain on the week, its biggest in more than four years.
The markets will look to the U.S. jobs data for direction, with the employment report expected to show employers adding 190,000 jobs in January.
Monday, January 25, 2016
Asian stocks are gaining that gave boost to global equities as markets across the region climbed, with energy shares leading the advance.
- MSCI Asia Pacific Index up by 1.2% to 119.98 as of 5:12 p.m. in Tokyo, Japan.
- Japan’s Topix index up by 1.3%
- South Korea’s Kospi index climbed 0.7%
- New Zealand’s benchmark up by 0.9%
- Australia’s S&P/ASX 200 Index increased by 1.8%
- Shanghai Composite Index up by 0.8%
- Hong Kong’s Hang Seng Index are up by 1.4%
- Mainland shares up by 0.8%
- Standard & Poor’s 500 Index slid 0.2%
- Cnooc Ltd., China’s largest offshore oil company, jumped 4.8%
- Santos Ltd. increase by 4.2% in Sydney
- Japan’s Inpex Corp. gained 3.3%
- West Texas Intermediate slide by 2.5% to $31.40 a barrel
Monday, January 18, 2016
Stock markets around the globe and oil prices has been pretty gloomy and they slumped to year lows last Monday. They are hit by continuous stress by shrinking global growth. However, European stocks has beat the odds and staged early bounce following last week's sell-off.
Since the United States markets are closed for the holiday (Martin Luther King Day), they don't have a chance to reverse the worst start in which main indices have lost as much as 10% in just 2 weeks.
Middle Eastern stocks plunged overnight, catching up with the fall across global bourses on Friday, while the prospect of a jump in Iranian crude exports after the lifting of sanctions against the country weighed heavily on oil.
Early Monday the FTSEuroFirst 300 index of leading shares was up 0.7%. Germany's DAX was up 0.6%, France's CAC 40 was up 0.4% and Britain's FTSE 100 was up 0.3%.
Gains at mobile telecoms gear marker Ericsson and luxury goods group LVMH floated the FTSEuroFirst off its 1-year low struck on Friday.
In Asia, MSCI's broadest index of Asia-Pacific shares outside Japan fell to its lowest since October 2011 and was last down 0.3%.
Japan's Nikkei lost as much as 2.8% to a one-year low before closing 1.1% lower. It has lost 20% from its peak hit in June, meeting a common definition of a bear market.
MSCI's emerging stock index dropped to 6-1/2-year low on Monday, and was last down 0.3% on the day.
Shanghai Composite index closed up 0.4%, however it was still down nearly 18% this month.
On Wall Street the S&P 500 .SPX hit a 15-month low on Friday, ahead of Monday's market holiday.
In oil markets, Brent crude fell below $28 a barrel LCOc1 for the first time since December 2003 after international sanctions against Iran were lifted over the weekend, allowing Tehran to return to an already over-supplied oil market.
U.S. crude also slumped to 12-year lows CLc1, intensifying the pressure on U.S. energy sector "junk" bonds.
Thursday, January 7, 2016
Chinese stocks bounce back after being pounded, the trading is very volatile after the Chinese government halt the controversial circuit breaker system, the central bank put up a higher yuan fix and state-controlled funds were said to buy equities.
The Shanghai Composite Index ended 2% higher, after falling as much as 2.2% earlier. The government suspendted the circuit breakers after plunges this week closed trading early on Monday and Thursday. The central bank set the currency’s reference rate little changed Friday after an 8-day stretch of weaker fixings that roiled global markets. State-controlled funds purchased Chinese stocks on Friday, focusing on financial shares and others with large weightings in benchmark indexes, according to people familiar with the matter.
Without the circuit breaker system it will help stabilize the market, but because of sense of panic that remains specially among retail investors it will be very volatile. The Government will have to continue to buy stocks significantly to stabilize the market.
While China’s high concentration of individual investors makes its stock-market notoriously volatile, the extreme swings this year have revived concern over the Communist Party’s ability to manage an economy set to grow at the weakest pace since 1990. The selloff has spread around the world this week, sending U.S. equities to their worst-ever start to a year and pushing copper to the lowest levels since 2009.
The CSI 300 Index of large-cap companies in Shanghai and Shenzhen advanced 2 percent. The Hang Seng China Enterprises Index climbed 1.7 percent from a four-year low at 3:22 p.m. as China Petroleum & Chemical Corp. led gains by energy companies, while the Hang Seng Index added 1.2 percent. The Shanghai Composite pared its weekly decline to 10 percent, its biggest loss since August.
China’s decision to suspend a stock circuit breaker makes sense, but the implementation and timing don’t, said Mohamed El-Erian, the chief economic adviser at Allianz SE. China realized that it had very tight limits, which did more harm than good, El-Erian said Thursday in an interview with Scarlet Fu on Bloomberg Television.
The Standard & Poor’s 500 Index has fallen 4.9 percent this year, its worst start in data going back to 1928. The MSCI All-Country World Index has tumbled 5.3 percent.
Trading in S&P 500 e-mini futures soared during Asia hours on Thursday, with volumes in the hour after 9 a.m. in Hong Kong more than six times their level during the same period on Monday, according to data compiled by Bloomberg. China releases the daily yuan reference rate around 9:15 a.m. Hong Kong time, and markets in that city and on the mainland start at 9:30 a.m.
Asian shares rebounded on Friday, led by strong gains for battered Chinese stocks after China suspended its market circuit breaker system and set a firmer midpoint rate for yuan trading for the first time in nine days.
The improved sentiment looks unlikely to spill over into Europe, however, with financial spreadbetters expecting Britain's FTSE 100 .FTSE to open flat, and Germany's DAX .GDAXI and France's CAC 40 .FCHI to start the day 0.5 percent lower.