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Lea Jakobiak
Unemployment in Britain has fallen to a five year low. The pound rose on the latest good news from Britain.
Article / 16 January 2013 at 6:51 GMT

Market Preview: World Bank cuts growth forecast; EU, US CPI eyed

SaxoBankUK SaxoBankUK
Saxo Capital Markets UK
United Kingdom

Forex Overnight: EUR trading weak
Currencies Intraday
The EUR has continued to trade under pressure against the majors this morning after Jean-Claude Juncker, Luxembourg's prime minister, said that the euro exchange rate is ‘dangerously high’. Additionally, the World Bank has lowered its global economic growth outlook for 2013. Meanwhile, market participants are keeping a tab on Eurozone and the US consumer price inflation data due later today. At 06:00 GMT, the EUR has weakened 0.2 percent and 0.1 percent versus the USD and the GBP to trade at USD 1.3288 and GBP 0.8277, respectively.

The JPY has climbed 1.1 percent and 0.7 percent against the EUR and the USD, respectively. Data released earlier today indicated that machine orders in Japan climbed more-than-expected in November.

The AUD has declined 0.1 percent versus the USD. Data indicated that Australia’s consumer sentiment improved marginally in January.

UK Stocks: Likely to open in the red
FTSE 100
The FTSE 100 is expected to open 5 points weak.

No key economic releases scheduled for today.

Ebiquity (EBQ) is scheduled to report its results today.

The Bank of England’s senior officials have indicated that Royal Bank of Scotland (RBS) and Lloyds Banking Group (LLOY) need billions of pounds of more capital to boost their balance sheets and support the economy.

Tesco (TSCO) has indicated that it has withdrawn several varieties of beef burgers from sale at its stores after samples were found to contain traces of horse meat in tests.

Asia: Trading mostly in negative territory
Nikkei 225
Asian markets are trading mostly lower this morning.

In Japan, Fujimori Kogyo (7917) has slumped after it announced a public offering of 1.7 million shares. Boeing Dreamliner suppliers, Fuji Heavy Industries (7270), GS Yuasa (6674) and Mitsubishi Heavy Industries (7011) have declined following news that a Dreamliner 787 aircraft operated by All Nippon Airways (9202) has made an emergency landing in western Japan. Export sector stocks, Toyota Motor (7203), Canon (7751) and Fanuc Corporation (6954) have lost value tracking a stronger JPY. At 06:00 am GMT, the Nikkei 225 index has declined 2.1 percent to trade at 10,654.0.

In Hong Kong, Industrial & Commercial Bank (1398), Agricultural Bank of China (1288) and China Overseas Land & Investment (688) have recorded losses after the Chinese premier, Wen Jiabao, said that China should “gradually” establish a property tax system. In China, Kweichow Moutai (600519) has dropped after it canceled a policy that penalised retailers that lowered prices with quota cuts. In South Korea, Daewoo Shipbuilding & Marine Engineering (042660) has edged up following confirmation that the company has submitted a bid for a project on a man-made island in the United Arab Emirates.

US Stocks: Futures trading weak
S&P 500
At 6 am GMT, S&P 500 futures are trading 1.8 points lower.

Consumer Price Index (CPI), Industrial Production, Manufacturing (SIC) Production, Capacity Utilisation, NAHB Housing Market Index, Net Long-term TIC Flows and MBA Mortgage Applications are the key economic indicators scheduled for release today. Investors are also keeping an eye on the Fed's Beige Book Survey scheduled for release later today.

JPMorgan Chase (JPM), eBay Inc. (EBAY), Goldman Sachs Group (GS), US Bancorp (USB), Kinder Morgan (KMI) and Bank of New York Mellon (BK) are scheduled to report their results later today.

Vera Bradley (VRA) rallied 9.8 percent in the after hours trading session on Tuesday after it raised its revenue and earnings guidance for the fourth quarter and FY2013. A hike to its fourth quarter same store sales outlook led Christopher & Banks (CBK) to jump 8.5 percent. TTM Technologies (TTMI) reversed its regular session losses and surged 5.1 percent in the after hours trading session after it provided upbeat fourth quarter revenue and earnings forecasts. On the downside, Dell Inc. (DELL) reversed its regular session gains and slipped 1.4 percent amid reports that a buyout deal for the company could be priced between USD 13.5 and USD 14.0 per share. Pacira Pharmaceuticals (PCRX) plummeted 7.7 percent following its plan to sell convertible senior notes worth around USD 100m. Cobalt International Energy (CIE) slumped 5.6 percent after it commenced an underwritten public offering of 40m shares.

Yesterday, the S&P 500 index advanced 0.1 percent in the regular trading session. Denbury Resources (DNR) surged 5.2 percent after it agreed to purchase oilfields in North Dakota and Montana from ConocoPhillips (COP) for around USD 1.1bn. Symantec Corporation (SYMC) climbed 4.7 percent after it announced that it plans to sell Altiris Inc., a software-management business. FMC Technologies (FTI) advanced 4.3 percent after a broker upgraded its rating on the stock to overweight from equal-weight. Retail sector stocks, J.C. Penney (JCP), Gap Inc. (GPS) rose 3.4 percent each, while Ross Stores (ROST) and Abercrombie & Fitch (ANF) gained 3.1 percent and 2.8 percent, respectively, after data indicated that US retail sales grew more-than-expected in December. On the contrary, Apple (APPL) continued to slide and lost 3.2 percent after it earlier reduced its orders for iPhone 5 LCD panels.

European Stocks: Expected to open higher
 EU Stoxx 50
The DAX and the CAC are likely to open 14 points firmer, each.

Key economic indicators scheduled for release today include Eurozone CPI & EU 25 New Car Registrations, Swiss Real Retail Sales and Italian Trade Balance.

No major corporate releases are slated for today in the Eurozone.

Bloomberg has reported that Ray Key, the global head of metals trading at Deutsche Bank AG (DBK), is planning to resign from his position.

Reuters has reported that Advent International, a private equity firm, is planning to sell its entire stake in Dufry AG (DUFN).

Macro Update
Euro exchange rate is ‘dangerously high’, says Juncker
Jean-Claude Juncker, the head of the Eurogroup finance ministers, has stated that the euro exchange rate is ‘dangerously high’ and is posing a fresh threat to the European economy.

World Bank lowers 2013 global growth forecast
The World Bank has indicated that the global economy might expand by 2.4 percent in 2013 compared to an earlier forecast of a 3.0 percent growth, citing weakness in developed economies.

Bond buying should continue until jobless rate falls to 7.25 percent, says Fed’s Rosengren
Eric Rosengren, the president of the Boston Federal Reserve Bank (Fed), has indicated that the central bank should not halt its bond buying program until the unemployment rate declines to 7.25 percent from the current rate of 7.8 percent.

Chinese actual FDI continues to fall
On an annual basis, actual foreign direct investment (FDI) in China has declined by a more-than-expected 4.5 percent in December compared to the 5.4 percent drop recorded in November.

Japan’s machine orders rise
On a monthly basis, machine orders in Japan have risen 3.9 percent in November, higher than market forecasts and compared to a 2.6 percent increase posted in October.

Japan’s domestic CGPI increases
The domestic Corporate Goods Price Index (CGPI) in Japan has climbed 0.3 percent month-on-month in December compared to a flat reading posted last month.

Consumer confidence in Australia improves
The Westpac-Melbourne Institute’s consumer confidence index in Australia has climbed to a reading of 100.6 in January from a reading of 100.0 reported in the previous month.

Australia’s new motor vehicle sales rise
On a seasonally adjusted monthly basis, new motor vehicle sales in Australia have jumped 2.2 percent in December compared to an upwardly revised 0.2 percent increase posted in November.

Economic Calendar

Country

GMT

Economic Indicator

Relevance

Consensus/
*Actual

Previous

Frequency

China

0:00

Actual FDI (YoY) (Dec)

Medium

 -4.50%*

-5.40%

Monthly

Japan

5:00

Consumer Confidence Index (Dec)

Medium

39.20*

39.40

Monthly

Eurozone

7:00

EU 25 New Car Registrations (Dec)

Low

-

-10.30%

Monthly

Switzerland

8:15

Real Retail Sales (YoY) (Nov)

Medium

3.40%

2.70%

Monthly

Italy

9:00

Global Trade Balance (Nov)

Low

-

EUR 2.45 bn

Monthly

Italy

9:00

Trade Balance EU (Nov)

Low

-

EUR 0.98 bn

Monthly

Eurozone

10:00

Consumer Price Index (YoY) (Dec)

High

2.20%

2.20%

Monthly

Eurozone

10:00

Consumer Price Index, Core (YoY) (Dec)

High

1.50%

1.40%

Monthly

US

12:00

MBA Mortgage Applications (11 Jan)

Low

-

11.70%

Weekly

US

13:30

Consumer Price Index (YoY) (Dec)

High

1.80%

1.80%

Monthly

US

13:30

Consumer Price Index Ex Food & Energy (YoY) (Dec)

High

1.90%

1.90%

Monthly

US

14:00

Net Long-term TIC Flows (Nov)

Medium

USD 14.80 bn

USD 1.30 bn

Monthly

US

14:15

Industrial Production (MoM) (Dec)

Medium

0.30%

1.10%

Monthly

US

14:15

Manufacturing (SIC) Production (MoM) (Dec)

Medium

0.60%

1.10%

Monthly

US

14:15

Capacity Utilisation (Dec)

Low

78.50%

78.40%

Monthly

US

15:00

NAHB Housing Market Index (Jan)

Medium

48.00

47.00

Monthly

US

15:30

DoE Crude oil inventories (11 Jan)

Low

2600.00 K

7412.00 K

Weekly

US

19:00

Fed's Beige Book

High

-

-

-


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

Corporate Calendar

Country

Company Name

Index

Announcement

UK

Barratt Developments Plc

FTSE All Share

Trading

UK

Bloomsbury Publishing Plc

FTSE All Share

Trading

UK

Diploma Plc

FTSE All Share

Trading

UK

Experian Plc

FTSE All Share

Trading

UK

JD Wetherspoon Plc

FTSE All Share

Trading

UK

N Brown Group Plc

FTSE All Share

Trading

US

Bank of New York Mellon Corp.

S&P 500

Q4 Earnings Release

US

Charles Schwab Corp.

S&P 500

Q4 Earnings Release

US

Comerica Inc.

S&P 500

Q4 Earnings Release

US

eBay Inc.

S&P 500

Q4 Earnings Release

US

Goldman Sachs Group Inc.

S&P 500

Q4 Earnings Release

US

JPMorgan Chase & Co.

S&P 500

Q4 Earnings Release

US

Kinder Morgan Inc.

S&P 500

Q4 Earnings Release

US

M&T Bank Corp.

S&P 500

Q4 Earnings Release

US

Northern Trust Corp.

S&P 500

Q4 Earnings Release

US

SLM Corp.

S&P 500

Q4 Earnings Release

US

US Bancorp.

S&P 500

Q4 Earnings Release


Ex-Dividend Calendar

Country

Company Name

Index

Announcement

UK

Imperial Tobacco Group Plc

FTSE 100

Final Ex-Dividend

1y
Tim Trevathan Tim Trevathan
So the 'carry trade is back!

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