Press review - page 12
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This is news of yesterday :) but as it is related to NFP for today so I am uploading it here:
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Forbes - Forex Market Muted Before NFP Friday :
It’s no surprise to witness a range bound multiple asset session ahead of tomorrow’s highly anticipated economic release, the U.S. nonfarm payrolls (NFP), and today’s Bank of England (BoE) and European Central Bank (ECB) rate announcements. The Independence Day holiday in the U.S. has already encouraged many to wade to the sidelines, as they prefer to trade in more liquid times. In today’s North American shortened trading session, price action will be dominated by entities not bothered by a liquidity premium. They are interested in adding to or paring positions after what ECB President Mario Draghi has to say in his routine press conference after the ECB rate notice.
Just to remind that we are going to have the following news event today :
2013-07-05 12:30 GMT | [USD - Non-farm Payrolls]
if actual > forecast = good for currency (for USD in our case)
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U.S. Employment Rises By More Than Expected In June :
Employment in the U.S. increased by more than anticipated in the month of June, according to a report released by the Labor Department on Friday.
The report said non-farm payroll employment increased by 195,000 jobs in June, matching the revised job growth seen in May.
Economists had been expecting employment to increase by about 160,000 jobs compared to the addition of 175,000 jobs originally reported for the previous month.
Despite the stronger than expected job growth, the unemployment rate came in unchanged at 7.6 percent. The unemployment rate had been expected to edge down to 7.5 percent.
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8 Oil Stocks With High Yields And Low Valuations :
It has become more of a challenge to find stocks trading at attractive valuations. One group that recently caught my eye is the major integrated oil companies.
Most of the stocks in this group have underperformed the S&P 500 Index over the past year, many by a significant margin.Moreover, several of the stocks discussed below have actually declined in 2013 while the S&P has gained about 16%. In addition to trading at more reasonable valuations than much of the market today, most of these stocks have the added benefit of paying relatively high dividends. Therefore, you get well paid from the dividends even if the stock prices continue to languish for a while longer.
Although they may be market laggards at the moment, I like the long-term prospects for the big oil companies. Demand for oil (and natural gas, which many of them produce in addition to oil) is likely to keep rising for the foreseeable future, particularly in the developing countries. And whether oil prices go up or down, the major oil companies always seem to find a way to grind out substantial profits.
Finally, the very fact that the oils often do move independently of the stock market as a whole makes them attractive investments. An oil stock or two can be a useful “anchor to windward” when a bear market eventually rolls around.
The stocks discussed below are all large international oil producers. They all trade at attractive valuations and pay generous dividends.
Dollar and Yields Soar after Payrolls :
The U.S. dollar ripped higher against all of the major currencies after the non-farm payrolls confirmed that the Federal Reserve is on track to taper asset purchases this year. Going into this key release, investors were looking for confirmation that the economy could handle a reduction in stimulus and they also wanted evidence that the labor market is improving like the Fed predicts. While the unemployment rate held steady at 7.6%, stronger than expected job growth and upward revision to the May report gave everyone the confidence that the jobless rate will slowly decline and meet the central bank’s lowered expectations.
With labor market numbers confirming that the U.S. economy is performing well enough for the central bank to reduce stimulus, we expect a further rally in the dollar. As U.S. yields head towards 3%, we should not only see more investors cut their dollar funded carry trades but Japanese companies hedging against a rising yen (by selling dollars) will soon find those hedges too expensive to bear. We are also seeing more investors buy dollars outright and all of these factors should help to drive the EUR/USD below 1.28, USD/JPY to 103 and the GBP/USD below 1.48.
USD Today - Is gold cheap enough to buy yet? :
You're cheap. You're so cheap that your clothes went out of style in the Roosevelt administration. Teddy Roosevelt's administration. Cheap. When someone asks you for three cheers, you only give two.
So when you look at the price of gold and notice that it's nearly 35% off its record high, you're intrigued. Is it cheap enough to buy yet? While there are several ways to answer that question, the answer is probably "not quite yet."
Gold currently sells for about $1,220 an ounce, down sharply from its 2011 high of $1,895. Whether that's cheap or not is hard to say, because putting a price on the intrinsic value of gold isn't easy. Unlike stocks or bonds, gold doesn't pay any interest or have any earnings, which is how people evaluate many investments.
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For patient stock-pickers, gold mining stocks may have some prospects. It's certainly better to buy them when they're beaten down than when they are on the rally. The question is whether or not they have been beaten down so much that they're candidates for reverting to the mean. Right now, the stocks may be cheap, but the metal itself might not be cheap enough yet.
EUR/USD weekly outlook: July 8 - 12 :
The euro fell to six-week lows against the broadly stronger dollar on Friday, as better-than-expected U.S. employment data for June fuelled expectations that the Federal Reserve will soon start to scale back its asset purchase program.
EUR/USD hit session lows of 1.2807, the pair's lowest since May 17 before settling at 1.2834, down 0.62% for the day and 1.35% lower for the week.
The pair is likely to find support at 1.2750, the low of March 27 and resistance at 1.2916, Friday’s high.
The Department of Labor said the U.S. economy added 195,000 jobs in June, more than the 165,000 increase forecast by economists. May's figure was revised up to 195,000 from a previously reported 175,000. The unemployment rate remained unchanged at 7.6% in June.
Fed Chairman Ben Bernanke said last month the bank could begin tapering its USD85 billion-a-month asset purchase program by the end of 2013 and wind it down completely by the middle of 2014 if the economy picks up as the central bank expects.
The euro dropped 0.73% against the dollar on Thursday after the European Central Bank adopted a dovish stance on interest rates and took steps to give forward guidance to markets.
Speaking at the bank’s post policy meeting press conference, ECB President Mario Draghi said the bank expects to maintain interest rates at current or lower levels for an “extended” period of time.
Draghi said the decision to give forward guidance on interest rates was taken unanimously by policymakers and was “a very significant step forward” for the ECB.
The ECB left interest rates on hold at record lows of 0.5%.
Draghi also said risks to growth in the euro zone remain “on the downside” and reiterated that monetary policy will remain accommodative for as long as is necessary.
In the week ahead, investors will be looking ahead to Wednesday's minutes of the Federal Reserve's June meeting, as well as Friday's closely watched data on U.S. consumer sentiment.
Talks by euro zone finance ministers and testimony by Mario Draghi to the European Parliament will also be in focus.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, July 8
In the euro zone, Germany is to produce official data on industrial production, a leading indicator of economic health, as well as data on the trade balance. Meanwhile, the eurogroup of euro zone finance ministers are to hold talks in Brussels.
In addition, ECB President Mario Draghi is to testify before the committee on Economic and Monetary Affairs in the European Parliament in Brussels.
Tuesday, July 9
Finance ministers from the European Union are to hold talks in Brussels.
Wednesday, July 10
In the euro zone, France and Italy are to release official data on industrial production.
Later Wednesday, the Federal Reserve is to publish the minutes of its June meeting. Meanwhile, Fed Chairman Ben Bernanke is to speak.
Thursday, July 11
The ECB is to publish its monthly bulletin, which outlines the bank’s economic outlook.
The U.S. is to release the weekly government report on initial jobless claims, a leading economic indicator, as well as official data on import prices.
Friday, July 12
The euro zone is to release official data on industrial production.
The U.S. is to round up the week with official data on producer price inflation and preliminary data from the University of Michigan on consumer sentiment.
The dollar hit five-week highs against the yen on Friday after strong U.S. employment data for June fuelled expectations that the Federal Reserve will start to scale back its asset purchase program later this year.
USD/JPY rose to session highs of 101.23, the highest level since May 31, before settling at 101.17, up 1.13% for the day, extending the week's gains to 1.72%.
The pair is likely to find support at 99.88, Friday’s low and resistance at 102.51, the high of May 29.
The Department of Labor said the U.S. economy added 195,000 jobs in June, more than the 165,000 increase forecast by economists. May's figure was revised up to 195,000 from a previously reported 175,000. The unemployment rate remained unchanged at 7.6% in June.
Fed Chairman Ben Bernanke said last month the bank could begin tapering its USD85 billion-a-month asset purchase program by the end of 2013 and wind it down completely by the middle of 2014 if the economy picks up as the central bank expects.
Elsewhere, the euro was higher against the yen on Friday, with EUR/JPY closing at 129.82, 0.50% higher for the day, trimming the week’s losses to 0.28%.
The euro weakened against the dollar and the yen on Thursday after the European Central Bank adopted a dovish stance on interest rates and took steps to give forward guidance to markets.
Speaking at the bank’s post policy meeting press conference, ECB President Mario Draghi said the bank expects to maintain interest rates at current or lower levels for an “extended” period of time.
Draghi said the decision to give forward guidance on interest rates was taken unanimously by policymakers and was “a very significant step forward” for the ECB.
The ECB left interest rates on hold at record lows of 0.5%.
In the week ahead, investors will be looking ahead to Wednesday's minutes of the Fed’s June meeting, as well as Friday's closely watched data on U.S. consumer sentiment. The outcome of Thursday's Bank of Japan policy meeting will also be in focus.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets. The guide skips Tuesday as there are no relevant events on this day.
Monday, July 8
Japan is to release official data on the current account and bank lending.
Wednesday, July 10
The BoJ is to release monetary policy meeting minutes, which provide insights into economic conditions from the bank’s perspective. Japan is also to produce official data on tertiary industry activity.
Later Wednesday, the Fed is to publish the minutes of its June policy setting meeting. Meanwhile, Fed Chairman Ben Bernanke is to speak.
Thursday, July 11
The BoJ is to announce its benchmark interest rate. The announcement is to be accompanied by the bank’s monetary policy statement, which contains important insights into the economic outlook. The BoJ is to hold a press conference after the rate announcement.
Japan is also to release official data on core machinery orders, a leading indicator of production.
The U.S. is to release the weekly government report on initial jobless claims, a leading economic indicator, as well as official data on import prices.
Friday, July 12
The U.S. is to round up the week with official data on producer price inflation and preliminary data from the University of Michigan on consumer sentiment.
Japan Data On Tap For Monday :
Japan is scheduled to release a raft of data on Monday, highlighting a light day for Asia-Pacific economic activity. On tap are May figures for current account, as well as June numbers for bank lending, bankruptcies and the eco watchers survey.
The current account is expected to reflect a surplus of 600.0 billion yen, down from the 750.0 billion yen surplus in April. Bank lending in May was up 2.1 percent on year, while lending including trusts added an annual 1.8 percent. Bankruptcies were down 9.0 percent on year in May, while the eco watchers outlook survey saw a score of 56.2 and the current survey came in at 55.7.
Australia will see the June results of the job advertisement survey from ANZ Bank; in May, job ads dipped 2.4 percent on month.
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2013-07-07 23:50 GMT | [JPY - Current Account]
actual > forecast = good for currency (for JPY in pour case)
Japan Has Y540.7 Billion Current Account Surplus In May :
Japan posted a current account surplus of 540.7 billion yen in May, the Ministry of Finance said on Monday - remaining in the green for the fourth straight month after three consecutive months of deficit.
The headline figure missed forecasts for a surplus of 600.0 billion yen following the 750.0 billion yen surplus in April.
The surplus jumped 58.1 percent on year, also shy of expectations for a jump of 91.6 percent following the 100.8 percent spike in the previous month.
The trade balance reflected a deficit of 906.7 billion yen versus forecasts for a shortfall of 902.1 billion yen following the 818.8 billion yen deficit in the previous month.
ECB cannot solve euro zone crisis, says Jens Weidmann, Bundesbank chief :
FRANCE: The European Central Bank cannot solve the euro zone crisis, Bundesbank chief Jens Weidmann told economists on Sunday, pressing the bloc's governments to get their economies in shape and tighten their fiscal rules.
Weidmann addressed an economists' conference in Aix-en-Provence, southern France, only three days after the ECB broke with precedent by declaring that it intended to keep interest rates at record lows for an extended period and may yet cut further.
"Monetary policy has already done a lot to absorb the economic consequences of the crisis, but it cannot solve the crisis," Weidmann said in his speech.
"This is the consensus of the Governing Council. The crisis has laid bare structural shortcomings. As such, they require structural solutions."
Weidmann, widely recognised to be the most hawkish member of the ECB's 23-man Governing Council, does not want the bank to intervene too strongly in tackling the bloc's economic crisis, thereby allowing governments to soft-pedal reforms.
Greece Strikes Deal With Troika On Bailout Tranche :
The Greek authorities reached an accord with the troika on economic reforms that are required to unlock next tranche of bailout fund, the European Commission said in a joint statement on Monday, just hours ahead of the Eurogroup meeting.
The troika that comprises the European Union, the European Central Bank and the International Monetary Fund, agreed that the macroeconomic outlook remains broadly in line with program projections, with prospects for a gradual return to growth in 2014.
However, the outlook remains uncertain, it said. Eurozone ministers at their meeting in Brussels later today will formally decide whether to release the next tranche of EUR 8.1 billion aid to Greece.
The aid funds are crucial for Athens to repay its bonds in August. The authorities committed to a number of tax reforms to secure the fund.
Prime Minister Antonis Samaras closed down the national broadcaster last month, a move that met with widespread protest. Greek officials on Sunday said 25,000 public sector workers would be put in a "mobility scheme". They would either be found new jobs or laid off by the end of this year.
Concluding the review mission to Greece, the troika said "policy implementation is behind in some areas." The agreement does not include a temporary reduction in the value added tax on restaurants.