AUDUSD Fundamentals (based on dailyfx article)
The Australian Dollar is set for a relatively flat finish after a
turbulent week that yielded plenty of intraday volatility. An upside
surprise to the Australian second quarter core CPI reading, and rise in
headline inflation to the top of the RBA’s 2 to 3 percent target band,
sent the currency soaring above the 94 US cent handle. Additional
strength for the Aussie was found on the back of a bumper China PMI
print, as well as an absence of ‘jawboning’ in a speech from RBA
Governor Glenn Stevens. Ultimately, most of the gains proved
short-lived, which may have reflected some hesitation from traders to
push the currency into a region of noteworthy technical resistance.
Looking to the week ahead; Building Approvals and the Performance of
Manufacturing Index figures represent the only medium-tier domestic
economic data on the calendar. However, the leading indicators for the
health of the local economy may do little to materially shift the rate
outlook, meaning any reaction from the AUD may fail to find
follow-through. Similarly, the Chinese manufacturing figures (also on
tap) could generate another round of knee-jerk volatility on a surprise
reading, yet likely hold do not hold the requisite power to leave a
lasting impact on the currency.
Indeed, Stevens’ recent address reinforced the prospect of a ‘period
of stability’ for the cash rate over the near-term. At this stage it
appears unlikely the RBA will change its stance while it attempts to
foster a rebalancing of the domestic economy.
Implied volatility remains near multi-year lows, suggesting traders
continue to price in a relatively small probability of a major economic
crisis occurring in the near-term. Traders are seemingly looking past
the latest flare-up in geopolitical tensions and have returned to the
hunt for yield.
The EUR/USD pair fell during the course of the week, clearing the 1.35
level. It now appears that the selling momentum is picking up, and
heading down towards the 1.33 level. The 1.33 level as you can see is
marked on the chart as support, and we feel that the buyers could step
back into the marketplace at that area. Nonetheless, it does appear that
in the meantime we are going to continue falling, and a break below the
1.33 level would be very bearish. Because of this, we don’t have any
interest in buying.
GBP/USD weekly outlook: July 28 - August 1
The pound edged down to one month lows against the broadly stronger
dollar on Friday as upbeat U.S. data and heightened geopolitical
tensions underpinned demand for the greenback.
GBP/USD edged down 0.06% to 1.6975 late Friday, the lowest since June 25. For the week, the pair lost 0.66%.
Cable is likely to find support at around the 1.6925 level and resistance at 1.7050.
recent sessions, sterling has backed off the almost six-year highs of
1.7190 set on July 15 as expectations for a rate hike by the Bank of
England before then end of the year waned.
The greenback was
boosted as better than expected data on durable goods orders for June
added to signs that the U.S. economy is improving.
Department reported a rise of 0.7% in orders of long lasting goods such
as machinery and electronic products, compared to forecasts of 0.5%.
Durable goods orders fell by 1.0% in May.
Demand for the dollar
has been underpinned since Federal Reserve Chair Janet Yellen indicated
earlier this month that U.S. interest rates could rise sooner if the
recovery in the labor market continues.
Investor demand for safe
haven assets was also boosted by geopolitical concerns as tensions
between the West and Russia remained high. The European Union imposed a
fresh round of sanctions against Russia on Friday, in protest over
Russia’s involvement in the crisis in east Ukraine.
Friday, official data confirmed that the U.K. economy grew 0.8% in the
second quarter of 2014 and expanded by 3.1% on a year-over-year basis.
Elsewhere, sterling gained ground against the broadly weaker euro, with EUR/GBP sliding 0.18% to 0.7910, not far from Wednesday’s 22-month low of 0.7873.
single currency weakened broadly on Friday as disappointing German
economic data underlined concerns over the diverging monetary policy
path between the European Central Bank and other central banks.
the week ahead investors will be focusing on U.S. data on
second-quarter gross domestic product and an interest rate decision by
the Federal Reserve on Wednesday, while Friday’s nonfarm payrolls report
for July will also be closely watched.
The U.K. is to release data on manufacturing sector activity on Friday.
Monday, July 28
Tuesday, July 29
Wednesday, July 30
Thursday, July 31
Friday, August 1
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mazennafee, 2014.07.28 14:00
United Kingdom - Ireland
National Grid issued an interim management statement for the April 1 - July 27 period: "Our businesses have continued to build on the performance improvements of 2013/14 and, as a result, have started the year well. (...) we are maintaining our outlook for 2014/15, reflecting the expected delivery of another year of solid operating and financial performance and asset growth, consistent with sustaining our long term dividend policy."
Aberdeen Asset Management posted an interim management statement: "The major element of the acquisition of Scottish Widows Investment Partnership ('SWIP') was completed on 31 March 2014, followed by the purchase of the SWIP infrastructure business which was completed on 1 May 2014. The process of integrating the SWIP business into the Aberdeen Group is proceeding in accordance with our expectations, both on timing and in delivering cost synergies, (...) AuM (Assets under management) at 30 June 2014 totalled £322.5B, a 0.6% decrease on 31 March 2014."
Reckitt Benckiser posted 1H results: "Total HY net revenue (ex RBP) was £4,323M, a LFL (like-for-like) increase of +4% (+4% total at constant rates, ex RBP). (...) Operating profit as reported was £1,059M, +16% versus HY 2013 (+30% constant), reflecting the reduction of exceptional pre-tax charges from £249M at HY 2013 to £22M at HY 2014. (...) Net income as reported was £812M, an increase of 23% versus HY 2013 (+38% constant). (...) Diluted EPS of 111.1p was +23% higher on a reported basis; on an adjusted basis, diluted EPS declined by -4% to 113.4p. (...) The Board of Directors declares an interim dividend of 60.0p (2013: 60.0p)."
Premier Oil said Richard Rose, currently an executive at Ophir Energy, will join the Co as finance director.
Debenhams announced the appointment of Matt Smith, currently CFO of Mothercare Plc, as CFO.
Ryanair reported that 1Q net income surged to E197M from E78M in the previous year on sales of E1.5B, up 11% YoY. The Co has raised its FY (to March 2015) net income guidance to E620M-650M from E580M-620M previously.
Auto & Parts health care and media shares fell most in London on Friday.
Automobiles & Parts: GKN (-1.99% to 344.2p) reached a new 3-month relative low against the FTSE 100.
Banks: Royal Bank Of Scotland Group (+10.77% to 364.2p) reached a new 3-month relative high against the FTSE 100.
Basic Resources: Anglo American (+3.44% to 1639.5p) closed at a 3-month relative high against the FTSE 100.
Food & Beverage: Diageo (-1.48% to 1797.5p) reached a new 3-month relative low against the FTSE 100.
Health Care: Glaxosmithkline (-3.16% to 1423p) closed at a 3-month relative low against the FTSE 100.
Industrial Goods & Services: Wolseley (-1.35% to 3146p), Royal Mail (-1.52% to 441.1p), Rexam (-2.01% to 513p), Electrocomponents (-2.65% to 234.8p) and Spectris (-7.68% to 1934p) closed at a 3-month relative low against the FTSE 100.
Media: United Business Media (-1.01% to 634p) closed at a 3-month relative low against the FTSE 100.
Personal & Household Goods: Burberry Group (-1.59% to 1420p) reached a new 3-month relative low against the FTSE 100.
Retail: Sports Direct International (-1.21% to 694p), Kingfisher (-1.26% to 304.6p), Booker Group (-1.34% to 125.2p) and Tesco (-1.62% to 270.35p) reached a new 3-month relative low against the FTSE 100.
Technology: Sage Group (-1.07% to 370p) reached a new 3-month relative low against the FTSE 100.
Travel & Leisure: TUI Travel (-0.92% to 365.2p) closed at a 3-month relative low against the FTSE 100.
Utilities: SSE (-1.01% to 1465p) closed at a 3-month relative low against the FTSE 100.
Stock/Benchmark ratio(s) 50D MA cross over: Carillion Plc (+7.18% to 362.8p), Pearson (+2.82% to 1132p), Royal Bank Of Scotland Group (+10.77% to 364.2p), William Hill (+1.03% to 342.5p)
Stock(s) 50D MA cross over: Carillion Plc (+7.18% to 362.8p), Royal Bank Of Scotland Group (+10.77% to 364.2p), Vodafone (+2.12% to 202.05p), William Hill (+1.03% to 342.5p)
Stock(s) 50D MA cross under: Admiral Group (-1.73% to 1481p), Ashmore Group (-1.1% to 360p), BSkyB (-5.46% to 874.5p), BT Group (-1.26% to 383p), BTG Plc (-2.57% to 606p), Catlin Group (-2.06% to 524p), DCC (-1.86% to 3479p), Marks & Spencer (-1.55% to 438.8p), Persimmon (-1.99% to 1280p), Reckitt Benckiser (-1.27% to 5070p), Rightmove (-1.27% to 2170p).
Latest broker recommendations
Royal Bank of Scotland was upgraded to "neutral" from "sell" at UBS and to "neutral" from "underweight" at JPMorgan.
Glaxosmithkline was downgraded to "neutral" from "buy" at BofA-ML.
mazennafee, 2014.07.28 14:24
Germany / Austria
Volkswagen's unit Audi has proactively lowered spare-part prices in China, reported Reuters citing an emailed statement. Last Friday, the Co (-1.83% to E180) closed at a 3-month relative low against the Dax.
Merck KGaA will launch the sale of non-prescription drugs in China with an aim to double revenues in the region to E1B by 2018, reported German weekly Wirtschaftswoche citing the Co's CEO.
Wincor Nixdorf reported that 9-month net income amounted to E61M, flat compared to the prior-year-period, and EBITA were also stable at E92M on net sales of E1.8B, down 2.1% YoY. The Co pointed out: "Business in the industrialized markets of Europe is progressing at a subdued rate. There is still no prospect of a sustained improvement in the investment climate for retail banks and retailers in this region, (...) The Co now expects (FY2013/14) net sales to reach a level comparable to that recorded in the previous year instead of rising by the 4% it had originally projected. The forecast for operating profit, by contrast, remains unchanged, with EBITA expected to increase by 17% to E155M."
GEA Group posted 2Q net income up 7.2% YoY to E81M (EPS up to E0.42 from E0.39) and EBITDA up 8.1% to E123M on revenue of E1.1B, up 5.0% (+8.0% organic growth). 1H net income grew 10.1% to E128M and EBITDA were up 11.5% to E206M. The Co confirmed its 2014 business outlook.
Fuchs Petrolub Morphosys: 2Q results expected.
Immofinanz AG: FY results expected.
Travel & Leisure: TUI (-1.92% to E10.74) reached a new 3-month relative low against the Dax.
Stock/Benchmark ratio(s) 50D MA cross under: Continental (-2.6% to E165.15).
DE - Stock(s) 50D MA cross over: Sky Deutschland (+1.35% to E6.75)
Stock(s) 50D MA cross under: Deutsche Euroshop (-1.74% to E36.17), Evonik Industries (-1.01% to E28.54), Henkel (-2.6% to E83.56), Infineon Technologies (-3.53% to E8.91), Linde (-1.13% to E152.85).
The jobless total in mainland France rose 0.3% MoM (+4.0% YoY) to 3,398,300 in June, according to the government.
Danone is negotiating the sale of its medical nutrition unit to US group Hospira and the deal could be priced up to $5B, reported the FT citing sources familiar with the matter.
Club Mediterranee's board recommended shareholders support a E790M takeover offer made by Italian financier and majority shareholder Andrea Bonomi.
Societe Generale, Arkema, Axa, Teleperformance CGG, ArcelorMittal: 1H results expected.
Automobiles & Parts: Michelin (-2.88% to E82.54) reached a new 3-month relative low against the Cac 40.
Basic Resources: Imerys (-2.99% to E57.49) reached a new 3-month relative low against the Cac 40.
Media: Publicis (-1.32% to E57.55) closed at a 3-month relative low against the Cac 40.
Oil & Gas: Technip (-2.75% to E69.05) closed at a 3-month relative low against the Cac 40.
Personal & Household Goods: Christian Dior (-6.31% to E136.65) and LVMH (-6.8% to E131.65) closed at a 3-month relative low against the Cac 40.
Retail: Carrefour (-2.15% to E27.03) reached a new 3-month relative low against the Cac 40.
Stock/Benchmark ratio(s) 50D MA cross under: Christian Dior (-6.31% to E136.65), ICADE (-2.61% to E72.64), Kering (-4.93% to E151.5), LVMH (-6.8% to E131.65).
Stock(s) 50D MA cross under: Air Liquide (-1.79% to E97.62), Bolloré (-1.58% to E464.05), Axa (-1.31% to E17.67), Foncière Des Régions (-1.76% to E76.04), GDF Suez (-2.94% to E19.8), L'Oréal (-1.7% to E126.9), Hermes (-2.28% to E258.95), Schneider Electric (-2.02% to E67.54).
Reed Elsevier said it has bought back 74K shares at E17.2158 per share last Friday July 25.
TNT Express 2Q results expected
Belgacom Cofinimmo: 1H results expected.
Chemicals: Solvay (-1.37% to E126.15) reached a new 3-month relative low against the BEL 20.
Industrial Goods & Services: Randstad (-1.85% to E36.28) and Gemalto (-2.81% to E72.65) reached a new 3-month relative low against the AEX.
NL - Stock/Benchmark ratio(s) 50D MA cross under: Nutreco (-2.97% to E31.7).
BE - Stock(s) 50D MA cross under: AB InBev (-1.36% to E82.53)
NL - Stock(s) 50D MA cross under: Nutreco (-2.97% to E31.7).
Spain - Portugal - Greece
Ferrovial may make an offer of A$1.5B for Australia's John Holland, a contracting and services unit of Leighton Holdings, reported Spanish daily newspaper Expansion. The Co is expected to release 1H results.
DIA reported that 1H net income surged to E211M from E49M in the previous year on sales of E3.8B, down 2.6%.
Jazztel, Bankia, Bolsas Y Mercados Espanoles, Amadeus IT: 1H results expected.
Banco Comercial Portugues, Galp Energia: 1H results expected
Industrial Goods & Services: Zardoya Otis (-1.26% to E11.77) closed at a 3-month relative low against the Ibex.
S - Stock/Benchmark ratio(s) 50D MA cross over: CaixaBank (+3.23% to E4.54), Corporacion Mapfre (+2.7% to E2.97)
Stock/Benchmark ratio(s) 50D MA cross under: Ferrovial (-1.05% to E15.96).
ES - Stock(s) 50D MA cross over: CaixaBank (+3.23% to E4.54), Corporacion Mapfre (+2.7% to E2.97)
GR - Stock(s) 50D MA cross over: OPAP (+4.42% to E12.53).
Intesa Sanpaolo Atlantia: 1H results expected.
Industrial Goods & Services: Atlantia (-2.73% to E19.99) reached a new 3-month relative low against the FTSE MIB.
Personal & Household Goods: Tod's (-1.1% to E85.8) reached a new 3-month relative low against the FTSE MIB.
Technology: STMicroelectronics (-1.69% to E6.41) reached a new 3-month relative low against the FTSE MIB.
Stock/Benchmark ratio(s) 50D MA cross over: Telecom Italia (+1.13% to E0.9).
Stock(s) 50D MA cross over: Luxottica Group (+1.59% to E42.21)
Stock(s) 50D MA cross under: Atlantia (-2.73% to E19.99), Banca Popolare Di Milano (-0.84% to E0.65), Tenaris (-1.24% to E16.66).
Novartis' eye-care unit Alcon announced that its Simbrinza eye drops suspension (brinzolamide 10mg/mL and brimonidine tartrate 2mg/mL) has been approved by the European Commission to decrease elevated intraocular pressure (IOP) in adult patients with open-angle glaucoma or ocular hypertension.
Chemicals: Syngenta (-1.95% to SF322.1) reached a new 3-month relative low against the SMI.
Construction & Materials: Sika (+0.8% to SF3767) reached a new 3-month relative high against the SMI.
Personal & Household Goods: Swatch Group (-2% to SF493.9) closed at a 3-month relative low against the SMI.
Automobiles & Parts: Nokian Renkaat (-1.49% to E27.09) closed at a 3-month relative low against the OMXH.
Construction & Materials: NCC AB (-1.05% to SEK227.1) reached a new 3-month relative low against the OMX Stockholm 30.
Health Care: Elekta Instrument (-1.18% to SEK83.55) closed at a 3-month relative low against the OMX Stockholm 30.
Industrial Goods & Services: Alfa Laval (-1.1% to SEK161.9) closed at a 3-month relative low against the OMX Stockholm 30.
Real Estate: JM AB (-1.9% to SEK222.4) reached a new 3-month relative low against the OMX Stockholm 30.
NO - Stock(s) 50D MA cross under: Statoil (-2.49% to NOK184).