20 February 2012 at 7:05 GMT
Forex Overnight: EUR trading higher
The EUR is trading firmer against the majors early Monday amid optimism that European leaders, at their meeting scheduled later today, will likely sign-off the €130.0 billion rescue package for Greece. Additionally, China resorting to monetary easing over the weekend, bolstered risk appetite and spurred demand for high yield currencies. At 6 am, the EUR has climbed 0.5 percent and 0.2 percent against the USD and the GBP, to trade at $1.3210 and £0.8322, respectively.
The JPY has strengthened 0.1 percent against the USD and has weakened 0.5 percent against the EUR. Data indicated that Japanese merchandise trade deficit widened in January.
The AUD has climbed 0.6 percent against the USD.
UK Stocks: Expected to open firmer
The FTSE 100 is likely to open 48 points in the green.
No major economic indicators are scheduled for release today.
CSR Plc, XP Power Limited and International Ferro Metals Limited are scheduled to report their results today.
BP has halted production at its Cherry Point refinery in Washington state on Saturday, following a fire incident at the refinery on Friday.
The Sunday Times has reported that Vodafone will have to pay at least £1.0 billion to win over investors in takeover target Cable & Wireless Worldwide.
Rio Tinto has stated that it will invest $518.0 million in driverless trains for its 1,500 kilometre Western Australian iron ore rail network.
The Daily Telegraph has reported that Lloyds Banking Group is to strip five current and former senior bankers of more than £1.0 million in bonuses over their role in payment protection insurance scandal.
Asia: Trading in the green
Markets in Asia are trading in positive territory this morning, after China’s central bank lowered reserve requirements for major commercial banks, and amid hopes that Greece may clinch the second bailout deal.
In Japan, Mitsubishi Corporation has jumped, amid news that it has agreed to acquire a 40.0 percent stake in the Cutbank Ridge gas field in the Canadian province of British Columbia. JFE Holdings, Sumitomo Metal Industries and Nippon Steel Corporation have paced gains, following positive broker comments. Export sector stocks, Hitachi Construction Machinery, Sony and Honda Motor are trading in the green. At 6 am, the Nikkei 225 index has advanced 1.0 percent to trade at 9,480.5.
In China, Industrial & Commercial Bank of China and Bank of China have advanced, after the Chinese central bank reduced its reserve ratio for banks by 50 basis points. Jiangxi Copper has gained value, after a broker recommended the stock as a “Top Buy”. In Hong Kong, homebuilders, China Overseas Land & Investment, New World Development and Agile Property Holdings have climbed. In South Korea, Hyundai Heavy Industries and Posco are trading in positive territory. On the other hand, Hyundai Engineering & Construction has declined, despite reports that the company, along with other construction firms, will likely sign a MOU with Saudi Arabia for the construction of 10,000 housing units.
US Stocks: Futures trading in positive territory
At 6 am, S&P 500 futures are trading 7.5 points firmer.
No major economic releases are scheduled for today.
Oneok Inc., Cabot Oil & Gas, Choice Hotels International, Watts Water Technologies and Neenah Paper are scheduled to announce their results today.
Brocade Communications lost 1.2 percent, in the after hours trading session on Friday, amid reports that Blackstone Group has ended negotiations to acquire the former. Codexis plunged 10.3 percent, following the resignation of its CEO, Alan Shaw. Madison Square Garden eased 0.2 percent. Reports indicated that the company has reached an agreement to settle its dispute with Time Warner Cable. On the other hand, Corcept Therapeutics rallied 57.4 percent, after the U.S. Food and Drug Administration approved its drug, Korlym, for treating a rare hormonal disorder called Cushing's syndrome.
In the regular trading session on Friday, the S&P 500 index rose 0.2 percent, amid optimism that European leaders will approve the second Greek bailout package. First Solar surged 7.3 percent, after it resolved permit problems that had been holding up the construction of its Antelope Valley power plant. HJ Heinz Company climbed 4.6 percent, after its third quarter earnings exceeded market expectation. On the contrary, Gilead Sciences slumped 14.3 percent, after it indicated that a majority of hepatitis C patients experienced a relapse after being treated with the company’s experimental drug. Weaker-than-expected profit forecast for the third quarter dragged General Mills 3.6 percent lower. Resources sector stocks, Alpha Natural Resources, Cliffs Natural Resources and EOG Resources retreated 3.8 percent, 2.8 percent and 2.8 percent, respectively.
European Stocks: Likely to open higher
The DAX and CAC are expected to open 77 points and 39 points firmer, respectively.
French Business Confidence Indicator, Production Outlook Indicator and Own Company Production Outlook are the key economic indicators scheduled for release today.
Ageas SA, Bank of Ireland, Generale De Sante SA, Ilkka Yhtyma Oyj and Beko Holding AG are scheduled to announce their results today.
Daimler AG has stated that it has received a business license to operate a new truck manufacturing joint venture with China’s Beiqi Foton Motor Company.
Financial Times Deutschland has reported that E.ON AG is in early talks with financial investors for involvement in its offshore wind power park project.
BNP Paribas SA has hired Toshiyuki Johno, former Managing Director at Citigroup Global Markets Japan Inc., as a commodity industry analyst in its Japan equities team.
The Sunday Telegraph has reported that AXA SA plans to expand in Asia and may consider a bid for ING Groep NV’s Asian assets.
Les Echos has reported that Henri Proglio, the CEO of EDF SA, is seeking to oust Antoine Frerot, as head of Veolia Environnement SA.
Joe Hogan, the CEO of ABB Ltd., has stated that the company could make acquisitions of up to $8.0 billion over the next three years.
Macro Update
UK house prices climb
Rightmove has indicated that, on a month-on-month basis, the average asking price for a house in the U.K. has advanced 4.1 percent in February, the biggest monthly rise since April 2002, and compared to a 0.8 percent decline recorded in January.
China cuts reserve ratio requirement
The People’s Bank of China has stated that the reserve requirement ratio for major commercial banks will be reduced by 50 basis points to 20.5 percent from 24 February 2012.
IMF should support agreement on Greece, says Geithner
Timothy Geithner, the U.S. Treasury Secretary, has stated that the U.S. will urge the International Monetary Fund (IMF) to support an accord on Greek economic reforms that had been agreed to by Greek political leaders.
Japanese trade deficit widens
Japanese merchandise trade deficit has widened to ¥1,475.0 billion in January, compared to a downwardly revised ¥205.6 billion deficit recorded in December.
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