Dollar Continues To Exhibit Strength

Trading 08 fév 2019 Commentaire »

The U.S. dollar has gained in strength this week on safe haven appeal, amid rising worries about global growth and uncertainty about a U.S.-China trade deal ahead of the March 1 deadline.

The Dollar Index, currently up 0.13%, at 96.41, has gained more than 1.1% in the week, its biggest weekly gain in nearly six months.

Among the major currencies, the Canadian dollar strengthened against the greenback after data showed a bigger than expected increase in Canadian jobs in January. However, Canadian unemployment increased to 5.8% in January, from 4.8% a month earlier.

The Loonie is gaining about 0.3%, having strengthened to $1.3268, from previous close of $1.3308.

The Japanese Yen is trading at 109.78 a dollar, up marginally from previous close of 109.81, after having weakened to 109.90 earlier.

The greenback is gaining about 0.14% against the Euro, having edged up from previous close of $1.1341.

Against the British Pound too the greenback is gaining, rising about 0.12%.

Disappointing economic data out of Germany and the downward revision in Euro area growth forecasts by the European Commission and the Bank of England have dented investor sentiment which has resulted in global stock markets taking a beating.

The European Central Bank President Mario Draghi said last month that risks to the euro area growth tilted to the downside thanks to persistent uncertainties such as protectionism.

U.S. President Donald Trump has reportedly said that he won't be meeting Chinese President Xi Jinping before a March 1 deadline.

U.S. Treasury Secretary Steven Mnuchin and other U.S. officials are scheduled to travel to Beijing next week to continue trade negotiations. Presidents of the two nations had agreed to a 90-day tariff truce in early December 2018.


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Treasuries Extend Upward Move Amid Concerns About Trade

Trading 08 fév 2019 Commentaire »

Extending the notable upward move seen over the course of the previous session, treasuries saw some further upside during trading on Friday.

Bond prices moved higher early in the session and remained firmly positive throughout the day. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, dipped 2 basis points to 2.632 percent.

The continued strength among treasuries came amid lingering concerns about a potential trade deal between the U.S. and China.

Adding to the worries, a report from the Wall Street Journal said the U.S. and China don't even have a draft accord that specifies where they agree and disagree.

The report comes after President Donald Trump told reporters he will not meet with Chinese President Xi Jinping before a crucial March deadline.

"Not yet. Maybe. Probably too soon," Trump said when asked if he would meet with Xi in the next month or so before flatly saying, "No" when asked if the two leaders would meet before the deadline.

Tariffs on Chinese goods are currently set to jump automatically on the deadline, although Trump is expected to delay the increase as talks continue.

However, White House economic adviser Larry Kudlow told Fox Business on Thursday the U.S. and China have a "pretty sizable distance to go" before reaching a trade deal.

Overall trading activity was somewhat subdued, as a lack of major U.S. economic data is keeping some traders on the sidelines.

The economic calendar remains relatively early next week, although reports on consumer and producer price inflation and industrial production are likely to attract attention as the week progresses.


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Crude Oil Futures Settle Slightly Higher

Trading 08 fév 2019 Commentaire »

Crude oil prices settled slightly higher on Friday, despite concerns about possible drop in energy demand in the near term due to global economic slowdown.

Traders were weighing possible drop in demand for crude and recent data showing higher crude output in the U.S.

The OPEC-driven production cuts and the U.S. sanctions on Venezuela's oil industry contributed to crude's marginal rise in the session.

West Texas Intermediate crude oil futures for March ended up $0.08, or 0.2%, at $52.72 a barrel.

On Thursday, crude oil futures ended down $1.37, or 2.5%, at $52.64 a barrel, the lowest settlement in more than a week.

Crude oil futures shed as much as 4.6% in the week.

Data released by Energy Information Administration on Wednesday showed that crude inventories increased by 1.26 million barrels last week. The increase, however, was less than what economists had expected.

Meanwhile, average weekly U.S. crude oil production remained at the record 11.9 million barrels per day it reached in late 2018.

Meanwhile, a report from Baker Hughes, released this afternoon, said U.S. oil rigs count rose by 7 to 854 this week. Last week, the rig count saw a decline of 15.

Downward revision in growth forecasts for the Euro area by the European Commission and the Bank of England and rising worries about U.S.-China trade tensions have raised fears about energy demand.

Worries about trade tensions have increased following a report from Wall Street Journal, the U.S. and China don't even have a draft accord that specifies where they agree and disagree.

Earlier, reports said that U.S. President Donald Trump will not meet with the Chinese President Xi Jinping before a crucial March deadline. Trump is quoted as saying, "Not yet. Maybe. Probably too soon," before finally said, "No" when asked if the two leaders would meet before the deadline.

U.S. Treasury Secretary Steven Mnuchin and other U.S. officials are scheduled to travel to Beijing next week to continue the negotiations. However, markets are still skeptical about the outcome as no significant progress has been made so far on the issue.

On Thursday, the European Commission slashed its GDP growth forecast for Eurozone for 2019 to 1.3% from 1.9% and lowered its estimate for growth in 2020 to 1.6% from 1.7%. The Bank of England too lowered its growth forecast for the Euro area.


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Gold Futures End Higher On Safe Haven Appeal

Trading 08 fév 2019 Commentaire »

Gold futures settled higher on Friday, as global growth worries prompted traders to shun riskier investments like equities and seek the safe haven asset. The dollar's continued strength limited gold's upside.

Downward revision in growth forecasts for the Euro area by the European Commission and the Bank of England and rising worries about U.S.-China trade tensions weighed on stocks for a second successive session.

The dollar index edged up by over 0.1% to 96.38, capping gold's gains.

Gold futures for April ended up $4.30, or 0.3%, at $1,318.50 an ounce. On Thursday, gold futures for April ended down $0.20, at $1,314.20 an ounce, extending losses to a fifth session.

For the week, gold futures shed about 0.3%.

Silver futures for March ended up $0.096, at $15.809 an ounce, while Copper futures for March settled at $2.8105 per pound, down $0.0180 from previous close.

Worries about trade tensions have increased following a report from Wall Street Journal, the U.S. and China don't even have a draft accord that specifies where they agree and disagree.

Earlier, reports said that U.S. President Donald Trump will not meet with the Chinese President Xi Jinping before a crucial March deadline. Trump is quoted as saying, "Not yet. Maybe. Probably too soon," before finally said, "No" when asked if the two leaders would meet before the deadline.

Meanwhile, reports indicate that tariffs on Chinese goods will jump automatically on the deadline, although Trump is expected to delay the increase as talks continue.

U.S. Treasury Secretary Steven Mnuchin and other U.S. officials are scheduled to travel to Beijing next week to continue the negotiations. However, markets are still skeptical about the outcome as no significant progress has been made so far on the issue.

On Thursday, the European Commission slashed its GDP growth forecast for Eurozone for 2019 to 1.3% from 1.9% and lowered its estimate for growth in 2020 to 1.6% from 1.7%.

The downgrade reflected external factors, such as trade tensions and the slowdown in emerging markets, notably in China. Officials warned that the European outlook faces substantial risks due to the uncertainty about Brexit and the slowdown in China.


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Hungary Trade Surplus Falls In December

Trading 08 fév 2019 Commentaire »

Hungary's foreign trade surplus decreased in December from a year ago, as imports grew at a faster pace than exports, preliminary figures from the Hungarian Central Statistical Office showed on Friday.

The trade surplus shrank to EUR 398 million in December from EUR 571 million in the corresponding month last year. The expected surplus was EUR 380 million.

Exports rose by 2.7 percent year-on-year and imports grew 5.4 percent.

In 2018, exports rose 4.3 percent and imports grew by 6.9 percent. The trade surplus fell to EUR 6.0 billion from EUR 8.1 billion in 2017.


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Sony announced a record buyback of shares worth $ 910 million

Trading 08 fév 2019 Commentaire »

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The Japanese multinational corporation Sony Corp. announced the launch of the largest share repurchase program (buyback) in the history of the company in the amount of 100 billion yen ($ 910 million).

Last year, the company did not make major purchases of its own shares. The current buyback started on Tuesday, February 5, and will run until March 22. The program will affect approximately 2.2% of the company's outstanding securities.

Last week, Sony published a quarterly financial report, which reported a decrease in revenue and worsened the annual forecast for this indicator, as a result, the company's capitalization dropped sharply by 8.1%.

After the announcement of the buyback value of the shares of Sony Corp. on the Tokyo Stock Exchange rose 4.10% to 4.906 yen.

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Finland Industrial Production Climbs Further

Trading 08 fév 2019 Commentaire »

Finland's industrial production increased for the second straight month in December, figures from Statistics Finland showed on Friday.

Industrial production rose a seasonally adjusted 1.3 percent month-on-month in December, faster than the 0.7 percent increase in November.

Production in the chemical industry grew the most, up 2.0 percent over the month, and manufacturing output registered an increase of 1.1 percent.

Meanwhile, the food industry had the biggest decline of 1.5 percent in December.

On a year-on-year basis, the industrial production climbed a seasonally and working day adjusted 3.3 percent in December.

In 2018, industrial production rose 3.7 percent, expanding for the third year in a row.


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Canadian Dollar Higher After Upbeat Jobs Data

Trading 08 fév 2019 Commentaire »

The Canadian dollar spiked up against its major counterparts in the European session on Friday, following the release of a data showing much better than expected Canadian job growth in the month of January.

Data from Statistics Canada showed that the employment rose by 66,800 jobs in January following an increase of 9,300 jobs in the previous month.

Economists were looking for a gain of 5,000 jobs.

The unemployment rate rose to 5.8 percent from 5.6 percent in December. Economists had forecast a reading of 5.7 percent.

Oil prices rose despite renewed worries that a trade dispute between the United States and China would remain unresolved.

Crude for March delivery rose $0.34 to $52.98 per barrel.

The currency dropped against its most major counterparts in the Asian session amid risk aversion, as U.S.-China tensions resurfaced following a CNBC report that a Trump-Xi meeting is highly unlikely before a March 1 deadline.

The loonie appreciated to 1.5016 against the euro, from a low of 1.5113 hit at 9:00 pm ET. The loonie is likely to challenge resistance around the 1.49 level.

Data from the Federal Statistical Office showed that Germany's exports rebounded at a faster-than-expected pace in December, exceeding expectations, and imports followed suit.

Exports rose a calendar and seasonally-adjusted 1.5 percent from November, when they declined 0.3 percent. Economists had expected 0.5 percent growth.

Having dropped to a 9-day low of 82.27 against the yen at 9:00 pm ET, the loonie reversed direction and advanced to 83.01. Next key resistance for the loonie is seen around the 84.00 region.

Data from the Ministry of Finance showed that Japan logged a current account surplus of 452.8 billion yen in December - shy of expectations for a surplus of 458.5 billion yen and down from 757.2 billion yen in November.

The trade balance showed a surplus of 216.2 billion yen, exceeding forecasts for 132.4 billion yen following the 559.1 billion yen deficit in the previous month.

The loonie strengthened to 1.3235 versus the greenback, following a 2-week low of 1.3329 touched at 9:00 pm ET. If the loonie rises further, 1.31 is possibly seen as its next resistance level.

The loonie reversed from an early 2-day low of 0.9454 against the aussie, rising to 0.9393. On the upside, 0.92 is possibly seen as the next resistance level for the loonie.


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Italy Industrial Production Falls More Than Expected

Trading 08 fév 2019 Commentaire »

Italy's industrial production decreased for a second month in December and at a faster pace, preliminary figures from the statistical office ISTAT showed on Friday.

Industrial production dropped 5.5 percent year-on-year in December after a fall of 2.6 percent in November. Economists had expected a 2.7 percent decline in production.

Consumer goods output fell 7.2 percent and production of intermediate goods decreased 6.4 percent. Output of energy and capital goods also declined.

On a month-on-month basis, industrial production fell 0.8 percent in December after a 1.7 percent in January.

For the whole year of 2018, the industrial production registered 0.8 percent compared to 2017.


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Russia Holds Key Rate Steady After December Hike

Trading 08 fév 2019 Commentaire »

Russia's central bank left its key rate unchanged in February, after raising it in December, saying that the balance of risks remains skewed towards pro-inflationary prospects.

The Board of Directors decided to hold the key rate steady at 7.75 percent, the Bank of Russia said in a statement on Friday, in line with economists' expectations.

The previous change in the rate was a quarter-point hike in December. A similar size raise was undertake in September, which was the first since 2014.

Inflation expectations of households and businesses increased somewhat, the bank said, adding that the effect of?the VAT increase on?inflation can be?fully assessed no?sooner than this April.

"There persists uncertainty over future external conditions and certain food price dynamics," the bank said. "The balance of?risks remains skewed towards pro-inflationary risks, especially over a?short-term horizon."

The Bank of?Russia forecast annual inflation to?range between 5.0 and 5.5 percent by?the end of?this year and return to?4 percent in?the first half of?2020.

"In?its key rate decision-making, the Bank of?Russia will determine if?the increases of?the key rate in?September and December 2018 were sufficient to?bring annual inflation back to?the target in?2020, taking into account inflation and economic performance against the forecast, as?well as?the risks associated with external conditions and financial markets' response to?them," the bank said.

Full year 2018 growth at 2.3 percent exceeded the central bank's forecast of 1.5-2 percent. The bank maintained its growth forecast for 2019 in the range of 1.2-1.7 percent.


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