Market Preview - 4 November 2011

Forex Overnight: USD trading higher
The USD has gained against the major currencies this morning ahead of the U.S. government’s jobs report, scheduled for release later today, which is expected to show that jobs growth slowed, while the unemployment rate remained unchanged in October. Additionally, investors are keeping a close eye on the confidence vote in the Greek Parliament today, following the abandoning of the proposed referendum on the bailout plan. At 6 am, the EUR and the GBP have lost 0.1 percent each against the USD, to trade at $1.3814 and $1.6017, respectively.
The AUD has weakened 0.2 percent against the USD, after the Reserve Bank of Australia lowered its forecast for the nation’s economic growth and inflation.
The JPY is trading marginally lower against the USD, while it has gained 0.1 percent against the EUR.

UK Stocks: Expected to open in positive territory
The FTSE 100 is likely to open 4 to 15 points in the green.
No major economic indicators are scheduled for release today.
Smith & Nephew, Millennium & Copthorne Hotels and Lancashire Holdings are scheduled to report their results later today.
Greg Abbott, the Attorney General of Texas, has stated that BP Products North America Inc., the U.S. subsidiary of BP, has agreed to pay $50.0 million in civil penalties to the state of Texas for pollution from its Texas City refinery.
Anthony Barker, the General Manager of BG Gas Marketing Singapore, has stated that BG Group would import additional spot cargoes of liquefied natural gas into Singapore from 2013, in addition to the 3.0 million tonnes of term supply it is contracted to sell to power and industrial users in Singapore.
Robert Diamond, the CEO of Barclays, has stated that more jobs and economic growth are required to ease social unrest, as strikes and protests spread across Europe and the U.S.

Asia: Trading stronger
Asian markets are trading higher this morning, taking cues from overnight gains on Wall Street.
In Japan, Komatsu Limited and Fanuc Corporation have advanced, following an unexpected rise in U.S. factory orders for September. Nissan Motor has gained value, after it hiked its profit guidance for the full year on Wednesday. Minebea has surged, after a broker reiterated its “Buy” rating on the stock, and increased the target price. On the other hand, Sony Corporation has slumped, after it projected a net loss for the full year ending 31 March 2012, following weak second quarter results. At 6 am, the Nikkei 225 index has gained 1.9 percent to trade at 8,804.5.
In Hong Kong, Industrial and Commercial Bank of China and HSBC Holdings have added value, after Greece abandoned a referendum on Europe’s bailout deal. In South Korea, LG Electronics has risen, after it announced a $945.0 million rights issue to fund its loss-making smartphone business. Exporters, Kia Motors, Samsung Electronics and Hyundai Motor have climbed, on signs of an improving scenario in the U.S. and Europe. In China, China Petroleum & Chemical Corporation and PetroChina have registered gains, amid speculation that the Chinese government may allow refiners to adjust prices on their own.

US Stocks: Futures trading lower
At 6 am, S&P 500 futures are trading 1.2 points weaker.
Key economic indicators scheduled for release today include Change in Non-farm Payrolls, Unemployment Rate, Change in Household Survey Employment and Average Hourly Earnings.
KKR & Co LP, Constellation Energy Partners LLC, Northeast Utilities, iGate, Acorda Therapeutics and GTX are scheduled to announce their results today.
In the after hours trading session on Thursday, Starbucks rose 3.1 percent, after it hiked its quarterly dividend, following upbeat fourth quarter results. Con-Way and Chesapeake Energy jumped 9.5 percent and 5.9 percent, respectively, after their third quarter profit exceeded market forecasts. Openwave Systems rallied 36.3 percent, amid news that Microsoft Corporation has agreed to license the company’s patent portfolio. LinkedIn tumbled 9.4 percent, after it swung to a third quarter loss, and indicated plans to sell shares worth around $100.0 million. MasTec slumped 14.4 percent, after it issued a lower-than-expected revenue and earnings guidance for the fourth quarter. Fluor declined 4.1 percent, after it offered a dismal full year earnings guidance.
In the regular trading session yesterday, the S&P 500 index gained 1.9 percent, as Greece backed away from the proposed referendum, and after the European Central Bank (ECB) unexpectedly lowered its key interest rates. Kraft Foods gained 3.3 percent, after it reported robust third quarter profit, and hiked its earnings guidance for the full year. Better-than-expected third quarter profit and a hike in its coal shipment outlook for FY2012 led Alpha Natural Resources to soar 13.3 percent. Qualcomm jumped 7.5 percent, after it posted upbeat fourth quarter results, and offered buoyant revenue outlook for the first quarter. Big Lots climbed 6.6 percent, after it reported a rise in its U.S. same-store sales for the third quarter. Estee Lauder and DirecTV rallied 17.9 percent and 6.2 percent, respectively, after they posted strong quarterly results. However, Abercrombie & Fitch plummeted 19.9 percent, after it reported sluggish growth in its European same-store sales.

European Stocks: Likely to open firmer
The DAX and CAC are expected to open 14 to 28 points and 5 to 11 points in the green, respectively.
German Services Purchasing Managers’ Index (PMI) & factory orders, French Services PMI, Eurozone’s Services PMI & Producer Price Index, and Swiss Foreign Currency Reserves are the key economic indicators scheduled for release today.
Commerzbank AG, Lafarge SA and Alcatel Lucent SA are scheduled to report their results today.
Handelsblatt has reported that Siemens AG has to write down more than €200.0 million for its Israel-based acquisition, Solel Solar, as business at the unit has developed more slowly than expected.
Endesa SA, through the Peruvian unit, Edelnor, has invested about $50.0 million in upgrading and expanding its infrastructure in Peru.
Financial Times Deutschland has indicated that Metro AG has put the sale of its Real supermarket chain on hold, citing the impending departure of its CEO, Eckhard Cordes.
Duncan Niederauer, the CEO of NYSE Euronext, has stated that the company and Deutsche Boerse AG could consider overlapping business areas in order to find concessions they could offer to pacify European regulators’ concerns over their plan to form the world’s largest exchange.

Macro Update
G20 urges Europe to fix the debt crisis
World leaders at the G20 meeting, expressed serious concern over Europe’s inability to stem its financial crisis, and called for a swift resolution for the sake of the global economy.
Greek Prime Minister to face survival vote
Greek Prime Minister, George Papandreou, is set to face a confidence vote today, after his plan for a referendum on the bailout deal backfired. Meanwhile, Greece’s largest opposition party has rejected the offer of sharing power with the existing government.
Australia lowers growth and inflation target
The Reserve Bank of Australia, in its quarterly monetary policy statement, has lowered its economic growth forecast for the year ending June 2012 to 4.0 percent, from the previous estimate of 4.5 percent, and has also cut its inflation estimate to 2.0 percent, from a prior prediction of 2.5 percent for the 12 months to June 2012.

Economic Calendar

Note: PPPHigh           PPMedium           PLow


Corporate Calendar