Article / 14 August 2013 at 17:17 GMT

Market Review: Eurozone escapes recession

Saxo Capital Markets UK
United Kingdom

Forex: USD trading mostly lower
Currencies Intraday
The USD is trading lower against most of its major counterparts, as better than expected data in the UK and the Eurozone supported the GBP and the EUR. Market participants await US consumer price inflation data scheduled tomorrow for further cues to the future outlook of the US Federal Reserve’s quantitative easing programme. Additionally, a raft of US macroeconomic releases slated for release later tomorrow are expected to grab market focus. The GBP is trading higher against the USD following a sharp decline in jobless claims in the UK in July. The EUR is trading 0.6 percent and 0.1 percent lower against the GBP and the JPY, respectively, while it is trading almost unchanged against the USD.

The AUD is trading 0.4 percent higher against the USD after Australia’s Westpac consumer sentiment index climbed in August.

UK Stocks: Closed lower
FTSE 100  Intraday
UK stocks ended in the red after some stocks in the key indices traded ex-dividend and following the minutes of the Bank of England’s latest meeting.

The FTSE 100 declined 0.4 percent to close at 6587.4 and the FTSE 250 dropped 0.1 percent to settle at 15086.3.

Eurasian Natural Resources Corporation (ENRC) slumped 3 percent after the company reported a drop in its first half-year revenue and pre-tax profit and cancelled its interim dividend payout.

Rio Tinto (RIO), Anglo American (AAL), Royal Dutch Shell (RDSB) and Standard Chartered (STAN) shed between 0.3 percent and 0.5 percent after they traded ex-dividend.

Countrywide (CWD) dropped 4.5 percent after its shareholders, Oaktree Capital Management LLC and Apollo Management LP, placed a 30 million share stake for sale.

African Minerals (AMI) tumbled 10.2 percent after the company announced changes to its management and following a downbeat broker comment.

On the upside, Rentokil Initial (RTO) rallied 6.1 percent after the company reported an increase in its first half-year sales and adjusted operating profit.

US Stocks: Trading in the red
Dow Jones Intraday
US stocks are trading lower amid some disappointing corporate earnings and on continued uncertainty about the stance of the US Federal Reserve on tapering the pace of its bond buying.

The Dow Jones has shed 0.5 percent to trade at 15375.7 and the S&P 500 has dropped 0.4 percent to trade at 1688.2.

Macy's (M) has dropped 3.9 percent after the company cut its profit guidance following weaker than estimated second quarter sales.

Home builders, DR Horton (DHI) and PulteGroup (PHM) have declined 2.1 percent and 1.7 percent, respectively.

Deere & Company (DE) has lost 1.9 percent after the company stated that it expects a 5 percent decline in its equipment sales in the current quarter.

On the upside, Newmont Mining (NEM) has surged 5.6 percent tracking higher gold prices.

Apple (AAPL) has added 1.6 percent a day after billionaire investor, Carl Icahn, revealed that he had bought around USD 1 billion worth of the company’s stock.

European Stocks: Close higher
EU Stoxx50 Intraday
European markets finished in the green after second quarter GDP data for most of the euro area economies came in better than expected.

The DAX rose 0.3 percent to end at 8438.1 and the CAC advanced 0.5 percent to close at 4114.2.

Subsea 7 SA (SUBC) rallied 8.5 percent after the company reported a narrower than estimated second quarter net loss.

United Internet AG (UTDI) jumped 4.6 percent following upbeat first half-year net profit and after it raised its forecast for new customer contracts.

Better than expected first half-year net profit led Swiss Life Holding AG (SLHN) to advance 5.3 percent.

On the contrary, a 38 percent drop in its first half-year net profit sent RWE AG (RWE) 4.5 percent lower.

Celesio AG (CLS1) dropped 1.1 percent after the company lowered its 2013 adjusted EBIT forecast, citing discount competition in the German wholesale market and negative currency effects.

Asia: Indices end mostly higher
Nikkei 225 Intraday
Asian markets closed mostly in the green tracking overnight gains on Wall Street.

In Japan, Nomura Real Estate Holdings (3231) added 3.7 percent amid reports that the company is leasing its distribution centres to online retailers and courier companies. Nippon Sheet Glass (5202) gained 4.8 percent following reports that the company is likely to sell some of its non-core assets. However, Aiful Corporation (8515) slumped 7.2 percent despite reporting a sharp rise in its first quarter net profit. The Nikkei 225 index advanced 1.3 percent to settle at 14050.2.

In China, a significant decline in its first half year net profit led Zijin Mining Group (601899) to slide 1.6 percent. On the other hand, FAW Car (000800) and SAIC Motor (600104) gained 4.2 percent and 1.7 percent, respectively, after Brilliance China Automotive Holdings, the Chinese partner of Bayerische Motoren Werke AG, reported a significant increase in its first half year profit. In South Korea, Hyundai Merchant Marine (011200) climbed 4.5 percent after it swung to a profit in the second quarter. Hyundai Motor (005380) advanced 2.6 percent despite reports indicating that around 45000 of its union workers in South Korea might go on a strike as early as next week. Trading in Hong Kong was cancelled today due to typhoon warning.

Commodities: Trading mixed

The Gold futures contract is trading 0.9 percent higher at USD 1333.2 per ounce amid a broad weakness in the US dollar.

The Brent crude one-month futures contract is trading 0.4 percent lower at USD 109.4 per barrel after refinery utilisation in the US fell to the lowest level since June. Losses were capped after the Energy Information Administration (EIA) reported that crude oil inventories in the US dropped by 2.81 million barrels in the week ended 09 August 2013, against expectations of a fall of 1.50 million barrels.

Macro Update

  • UK jobless claims falls more than forecast in July
  • BoE members voted unanimously to keep asset purchases unchanged, indicates BoE minutes
  • Eurozone economy expanded for the first time in seven quarters in the second quarter of 2013
  • US producer prices remain unexpectedly flat in July

Economic Calendar

Country

GMT

Economic Indicator

Relevance

Consensus/
*Actual

Previous/
**Previous Est.

Frequency

US

17:20

Fed's Bullard speech

Low

-

-

-

Japan

23:50

Foreign Buying Japan Stocks (09-Aug)

Low

-

-JPY 42.20bn

Weekly

Japan

23:50

Foreign Buying Japan Bonds (09-Aug)

Low

-

JPY 124.40bn

Weekly

Japan

23:50

Japan Buying Foreign Stocks (09-Aug)

Low

-

-JPY 19.50bn

Weekly

Japan

23:50

Japan Buying Foreign Bonds (09-Aug)

Low

-

JPY 689.90bn

Weekly

China

-

Actual FDI (YoY) (Jul)

Medium

14.00%

20.10%

Monthly

China

1:30

FDI - Foreign Direct Investment (YTD) (YoY) (Jul)

Low

-

4.90%

Monthly

UK

8:30

Retail Sales (YoY) (Jul)

Medium

2.40%

2.20%

Monthly

UK

8:30

Retail Sales (MoM) (Jul)

Low

0.60%

0.20%

Monthly

UK

8:30

Retail Sales ex-Fuel (YoY) (Jul)

Medium

2.70%

2.10%

Monthly

UK

8:30

Retail Sales ex-Fuel (MoM) (Jul)

Low

0.60%

0.20%

Monthly

US

12:30

Consumer Price Index (YoY) (Jul)

High

2.00%

1.80%

Monthly

US

12:30

Consumer Price Index (MoM) (Jul)

Medium

0.20%

0.50%

Monthly

US

12:30

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

Medium

1.70%

1.60%

Monthly

US

12:30

Consumer Price Index Ex Food & Energy (MoM) (Jul)

Low

0.20%

0.20%

Monthly

US

12:30

Consumer Price Index n.s.a. (Jul)

Low

233.74

233.50

Monthly

US

12:30

Consumer Price Index Core s.a (Jul)

Low

-

233.64

Monthly

US

12:30

Initial Jobless Claims (10-Aug)

Medium

335.00K

333.00K

Weekly

US

12:30

Continuing Jobless Claims (03-Aug)

Low

3000.00K

3018.00K

Weekly

US

12:30

NY Empire State Manufacturing Index (Aug)

Low

10.00

9.46

Monthly

US

13:00

Net Long-Term TIC Flows (Jun)

Medium

-USD 10.00bn

-USD 27.20bn

Monthly

US

13:00

Total Net TIC Flows (Jun)

Low

-

USD 54.60bn

Monthly

Canada

13:00

Existing Home Sales (MoM) (Jul)

Low

-

3.30%

Monthly

US

13:15

Industrial Production (MoM) (Jul)

Medium

0.30%

0.30%

Monthly

US

13:15

Capacity Utilisation (Jul)

Low

77.90%

77.80%

Monthly

US

14:00

Philadelphia Fed Manufacturing Survey (Jul)

Medium

15.00

19.80

Monthly

US

14:00

NAHB Housing Market Index (Aug)

Low

57.00

57.00

Monthly

Canada

14:30

BoC Review

Low

-

-

Quarterly

For more events see TradingFloor.com's real-time financial calendar.

 

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