Article / 11 December 2012 at 7:05 GMT

Market Preview: Eurozone and German ZEW sentiment indices eyed

Saxo Capital Markets UK
United Kingdom

Forex Overnight: USD trading mostly lower
Currencies Intraday
The USD is trading lower against most of the major currencies this morning amid market speculation that the US Federal Reserve might resort to further easing measures at a two-day monetary policy meeting commencing today. Additionally, markets are keeping an eye on German and Eurozone sentiment indices due later today which are expected to show an improvement for December. At 6 am GMT, the EUR and the GBP have climbed 0.2 percent and 0.1 percent versus the USD to trade at USD 1.2957 and USD 1.6086, respectively.

The AUD has weakened 0.1 percent versus the USD after data indicated that business confidence in Australia deteriorated further in November.

UK Stocks: Expected to open marginally firmer

FTSE 100
The FTSE 100 is likely to open 1 to 3 points in the green.

Conference Board’s Leading Economic Index is the key economic indicator scheduled for release today.

Ashtead Group, Victrex, Domino Printing Sciences, Carpetright, Zytronic, Ishaan Real Estate, International Greetings and Terrace Hill Group are scheduled to report their results today.

The Wall Street Journal has reported that US regulators are set to announce a USD 1.9 billion settlement with HSBC Holdings to end money laundering charges against the company.

Asia: Trading mixed
Nikkei 225
Asian markets are trading mixed this morning ahead of the US Federal Reserve’s two day monetary policy meeting starting later in the day.

In Japan, Kansai Electric Power, Chubu Electric Power and Tokyo Electric Power have declined after the Japanese Nuclear Regulation Authority raised concerns that an earthquake risk might prevent operations from resuming at Japan Atomic Power Company’s Tsuruga No. 2 reactor. On the contrary, Renesas Electronics has advanced after it indicated that it plans to sell shares as part of its bailout plan. Sumco Corporation has added value after a broker raised its rating on the stock to “Out-perform” from “Neutral”. At 6 am GMT, the Nikkei 225 has declined 0.1 percent to trade at 9,523.5.

In Hong Kong, Standard Chartered has edged up after it agreed to pay USD 327.0 million to resolve allegations related to the violation of the US sanctions against Iran, Sudan and two other countries. HSBC Holdings has inched up amid news that it is close to a USD 1.9 billion settlement with US authorities over money laundering charges. In China, Bank of Communications has lost value after data indicated lower-than-expected bank lending in China for November. In South Korea, STX Offshore & Shipbuilding has surged amid reports that STX Corporation, its parent firm, was nearing a deal to sell a controlling stake in its affiliate, STX OSV Holdings.

US Stocks: Futures trading in the red
S&P 500
At 6 am GMT, S&P 500 futures are trading 3.1 points weaker.

Trade Balance, Wholesale Inventories, NFIB Small Business Optimism Index, IBD/TIPP Economic Optimism Index and Redbook Index are the major economic indicators scheduled for release today.

Dollar General, Casey's General Stores, Geospace Technologies, Central Garden & Pet Company and Pantry are scheduled to report their results later today.

American International Group (AIG) edged 0.9 percent down in the after hours trading session yesterday after the US Treasury Department announced that it plans to sell its remaining 16.0 percent stake in the company. L&L Energy reversed its regular session gains and retreated 3.4 percent in the after hours trading session. On the upside, an announcement of a quarterly dividend of USD 0.50 per share led Kraft Foods to advance 1.5 percent. Urban Outfitters rallied 6.5 percent after it issued a better-than-anticipated fourth quarter revenue outlook. Texas Instruments edged 0.1 percent up after it forecast fourth quarter revenue in line with market expectations. Stillwater Mining rose 3.1 percent after Standard & Poor's stated that the company would replace JDA Software Group in the S&P SmallCap 600 index with effect from the close of trading on 13 December 2012. Limited Brands climbed 2.7 percent after it declared a special dividend of USD 3.00 per share.

Yesterday, the S&P 500 index ended almost flat in the regular trading session. Commodity sector stocks, Cliffs Natural Resources and Newmont Mining gained 4.6 percent and 1.6 percent, respectively, tracking higher commodity prices. Hewlett-Packard ended 1.6 percent higher amid reports that Carl Icahn, an activist investor, might buy a stake in the company. McDonald’s advanced 1.1 percent on the back of strong sales in November. Technology sector stocks, Micron Technology and Cisco Systems climbed 3.4 percent and 2.4 percent, respectively. On the flipside, Priceline.com retreated 5.1 percent after a broker downgraded its rating on the stock to “Hold” from “Buy”, citing competition worries. AIG declined 2.3 percent after it warned of a loss of around USD 1.3 billion related to Superstorm Sandy, the highest sum disclosed by a US insurer.  

European Stocks: Likely to open in positive territory
EU Stoxx 50
The DAX and the CAC are expected to open 9 to 10 points and 10 points stronger, respectively.

Eurozone & German ZEW Economic Sentiment Indices, German ZEW Current Situation Index & Wholesale Price Index and French Nonfarm Payrolls are the key economic indicators scheduled for release today.

Lafuma SA is slated to report its results later today.

ThyssenKrupp AG has reported a significant full year net loss due to a write-down on steel mills in the US and Brazil. The company provided a weak 2013 outlook and stated that it would not pay dividends for 2012.

Reuters has reported that Autogrill SpA has won the bid to run duty free shops at 26 Spanish airports owned by public operator, Aena.

Macro Update
UK house price balance unexpectedly deteriorates
The seasonally adjusted house price balance in the UK, as measured by the Royal Institute of Chartered Surveyors’, has surprisingly declined to a reading of -9.0 in November from a reading of -7.0 posted in October.

China’s new loans rise less-than-forecast
Chinese banks have extended CNY 522.9 billion of new loans in November, less than market expectations and compared to CNY 505.2 billion loans extended in the earlier month.

Japan’s M2 money supply growth slows
On an annual basis, M2 money supply growth in Japan has eased to 2.1 percent in November from a 2.3 percent rise posted in the previous month.

Australian business confidence weakens
The National Australia Bank’s business confidence index in Australia has dropped to a reading of -9.0 in November, the lowest reading since April 2009 and compared to a reading of -1.0 reported in October.

New Zealand’s house prices rise
The Real Estate Institute of New Zealand has reported that its house price index in New Zealand has risen 1.4 percent M-o-M in November compared to a 1.5 percent rise posted last month.

Economic Calendar

Country

GMT

Economic Indicator

Relevance

Consensus/
*Actual

Previous /
**Previous Est.

Frequency

UK

0:01

RICS House Price Balance (Nov)

Medium

 -9.00%*

-7.00%

Monthly

France

6:30

Nonfarm Payrolls, Final (QoQ) (Q3)

Low

-0.30%

 -0.30%**

Quarterly

Germany

7:00

Wholesale Price Index (YoY) (Nov)

Low

-

4.60%

Monthly

UK

10:00

Conference Board Leading Economic Index (Nov)

Low

-

0.20%

Monthly

Germany

10:00

ZEW Survey (Current Situation) (Dec)

Medium

6.00

5.40

Monthly

Germany

10:00

ZEW Survey (Economic Sentiment) (Dec)

High

-11.50

-15.70

Monthly

Eurozone

10:00

ZEW Survey (Economic Sentiment) (Dec)

Medium

0.10

-2.60

Monthly

US

12:30

NFIB Small Business Optimism (Nov)

Low

92.50

93.10

Monthly

US

13:30

Trade Balance (Oct)

Medium

 -USD 42.60 bn

 -USD 41.50 bn

Monthly

US

13:55

Redbook index s.a (MoM) (2 Dec)

Low

-

-0.30%

Weekly

US

15:00

Wholesale Inventories (MoM) (Oct)

Low

0.40%

1.10%

Monthly

US

15:00

IBD/TIPP Economic Optimism (Dec)

Low

50.00

48.60

Monthly

Japan

23:50

Machine Orders (MoM) (Oct)

Low

3.00%

-4.30%

Monthly

Japan

23:50

Tertiary Industry Index (MoM) (Oct)

Medium

-0.40%

0.30%

Monthly

Japan

23:50

Domestic Corporate Goods Price Index (MoM) (Nov)

Low

0.00%

-0.30%

Monthly

China

-

M2 Money Supply (YoY) (Nov)

Low

14.10%

14.50%

Monthly


See today's events updated in real-time in our Financial Calendar on TradingFloor.com.

Corporate Calendar

Country

Company Name

Index

Announcement

UK

Ashtead Group Plc

FTSE All Share

Q2 Earnings Release

UK

Carpetright Plc

FTSE All Share

Interim

UK

Domino Printing Sciences Plc

FTSE All Share

Final

UK

Go-Ahead Group Plc

FTSE All Share

Trading

UK

IG Group Holdings Plc

FTSE All Share

Trading

UK

Victrex Plc

FTSE All Share

Final

UK

Whitbread Plc

FTSE All Share

Trading

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