Market Preview - 5 July 2012; ECB and BoE meetings to drive mkts

UK Stocks: To open slightly in negative territory
The FTSE 100 is likely to open 4 to 9 points in the red.
Halifax House Price Index is the major economic indicator scheduled for release today. Investors also await the interest rate decision and the asset purchase target from the BoE.
NCC Group and Begbies Traynor Group are scheduled to report their results today.
According to a notice filed with the California pollution regulators, BP’s 253,000-barrels-per-day Los Angeles-area refinery in Carson, California, has restored a compressor to operation following its failure on Tuesday.
The Australian Competition & Consumer Commission has indicated that it will not oppose Glencore International’s takeover of Xstrata.
According to Bloomberg, GKN has agreed to acquire Volvo AB’s aircraft engine unit for a consideration of about £700.0 million.

Asia: Trading under pressure
Asian markets are trading in the red this morning ahead of the monetary policy decisions from the BoE and the ECB slated later today.
In Japan, GS Yuasa Corporation has declined after a broker lowered its price target on the stock. Sumitomo Corporation is trading lower amid reports that it would acquire a 50.0 percent stake in an Australian coal mine from Aquila for about A$442.0 million. Energy sector stocks, Inpex Corporation and JX Holdings have declined following weak crude oil prices. On the upside, Osaka Securities Exchange Company has climbed after Japan Fair Trade Commission approved its takeover by Tokyo Stock Exchange Group. At 5 am GMT, the Nikkei 225 index has declined 0.3 percent to trade at 9,078.5.
In Hong Kong, Foxconn International has dropped after its Vice President, Terry Cheng, unexpectedly stepped down. Resource sector stocks, China Coal Energy and Jiangxi Copper Company are trading under pressure. In South Korea, electronic sector stocks, Samsung Electronics and LG Electronics have shed value. Hyundai Motor Company has declined after it stated that the company’s union has threatened a strike later this month. In China, Bank of China paced declines among banking sector stocks following reports that China Banking Regulatory Commission is in discussion over new rules to limit credit growth.

US Stocks: Futures trading lower
At 5 am GMT, S&P 500 futures are trading 4.2 points weaker.
ISM Non-Manufacturing Composite Index, ADP Employment Change, Initial & Continuing Jobless Claims and MBA Mortgage Applications are the key economic indicators scheduled for release today.
International Speedway Corporation, Xyratex Limited and Computer Task Group are scheduled to announce their results today.
Yesterday, US markets were closed on account of Independence Day holiday.

European Stocks: Likely to open in the red
The DAX and CAC are expected to open 17 to 21 points and 4 to 10 points weaker, respectively.
German Factory Orders is the key economic indicator scheduled for release today. Additionally, investors await the ECB interest rate decision slated later today.
AB Industrivarden is scheduled to announce its results today.
Sanofi SA has announced that it plans to sell about 19.0 percent stake in Yves Rocher Group, a consumer products company, to its majority owner.
French daily, Le Figaro, has reported that Sanofi SA plans to cut 1,000 to 2,000 jobs in France.
Volkswagen AG has stated that it would acquire the remaining 50.1 percent stake in Porsche Automobil Holding SE's sports car unit in August.
Bankia SA has announced that Francisco Verdu, its CEO, has resigned with immediate effect.

Forex Overnight: EUR trading flat
The EUR is trading almost unchanged against most of the major currencies this morning ahead of the interest rate decision from the European Central Bank (ECB) slated later today, wherein the central bank is expected to lower its benchmark interest rate. Market participants also await the outcome of the Bank of England’s (BoE) monetary policy meeting and the Spanish long term bond auction due later today. At 5 am GMT, the EUR is trading flat against the USD and the GBP at $1.2529 and £0.8035, respectively.
The JPY has advanced 0.1 percent each against the USD and the EUR.
The AUD has declined 0.2 percent versus the USD after data indicated that Australian trade deficit widened in May.

Macro Update
Monti, Merkel vow to cooperate on crisis
Italian Prime Minister, Mario Monti and German Chancellor, Angela Merkel have agreed to work together to resolve the Eurozone debt crisis and build a stronger European Union.
Europe debt woes biggest risk to Japan, warns Shirakawa
The Bank of Japan Governor, Masaaki Shirakawa, has cautioned that the European debt crisis remains the biggest threat to the Japanese economy and could potentially impact its financial system.
Australian trade deficit widens
On a seasonally adjusted basis, the trade deficit in Australia stood at A$285.0 million in May compared to a revised A$26.0 million deficit posted in the previous month.

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