The Nasdaq has stretched to a fresh session high, which also makes for a new two-year high. Its move this session has been led by the likes of Apple (AAPL 357.40, +2.86) and Google (GOOG 623.77, +7.33).
In contrast, Nasdaq member Microsoft (MSFT 27.27, -0.23) is under stiff pressure. Investors have shown a negative response to news that the company has formed a business partnership with Nokia (NOK 9.19, -1.69).
The dollar rose against most of its major counterparts as Egyptian President Hosni Mubarak stepped down and handed power to the military.
The greenback headed for a third weekly gain versus the euro as Mubarak bowed to the demands of protesters, who are likely to call for immediate elections.
“After the Egyptian announcement, the market quickly realized that there is a lot of uncertainty about who is going to take control, how these elections are going to progress and what the next government is going to look like, so you saw risk aversion quickly return,” said Blake Jespersen, director of foreign exchange in Toronto at Bank of Montreal. “The U.S. dollar is gaining modestly from this.”
Australia’s currency slid below parity with the dollar after Reserve Bank Governor Glenn Stevens said policy makers judged it “sensible” to keep interest rates on hold. The head of Germany’s central bank resigned, while data showed U.S. consumer confidence rose.
Stocks recently pulled back a bit from session highs after news of the resignation of Egypt's President Mubarak was digested. They have since regrouped to reclaim gains.
Financials have emerged as a leader in recent trade; the sector is up 1.1%, which is more than double the gain of any other sector. Financials are currently led by regional banks like SunTrust (STI 32.72, +1.13) and Regions Financial (RF 8.07, +0.34). Collectively, regional banks are up 2.2%, which puts the group back near nine-month highs. Regional banks are up 2.6% week to date.
Stocks have extended their morning push into positive territory. The vertical move has accelerated with news that Egypt's President Mubarak has resigned.
News of Mubarak's resignation has caused oil prices to pull back so that crude prices trade with a loss of more than 1% at about $85.65 per barrel.
Oil trades at $86.47, down $0.27 and in the lower end of the day's $85.62/87.77 range.
USD/JPY holds Y83.33 after printing the morning high at Y83.67. Dollar offers likely still around that Y83.70 area with stops tight above, followed by further supply into and beyond Y84.00.
Analysts at Bank of Tokyo-Mitsubishi-UFJ says prelim Feb U-Michigan consumer sentiment was +0.9 pt and "current conditions index jumped +5.0 pts to 86.8 (the highest level since Jan'08), but expectations declined by 1.7 pts to 67.6." The latter may reflect concern about "rising gas prices and unrest in the Middle East."
Media reports that Egyptian President Mubarak has left Cairo and has arrived with his family to the resort city of Sharm el- Sheikh. AlJazeera reports that a "urgent and important" statement is expected from the presidential palace shortly.
Analysts at Goldman say the prelim Feb Rtrs/U-Michigan consumer sentiment might show a small increase. They also note the 5y inflation estimate has held a tight 2.7%-2.9% range since November 2009. Median estimate of surveyed economists is 75 vs 74.2 in Jan final reading.
Stocks were set for early losses Friday after declines in Europe, amid concerns about Egypt's future. After weeks of anti-government protests, Egyptian President Hosni Mubarak said late Thursday that he would delegate powers to the vice president, but remain the titular head of his country.
Economy: As expected, the White House proposed a plan Friday morning to wind down beleaguered mortgage backing companies Fannie Mae and Freddie Mac, in an effort to reform the housing market.
The U.S. trade gap widened to $40.6 billion in December (the highest level in three months), according to government data. Analysts expected the trade balance to have widened to $40.4 billion, from $38.3 billion in November.
A report on consumer sentiment from the University of Michigan comes out after the market opens.
Companies: Finnish mobile phone maker Nokia (NOK) announced plans to use Microsoft's Windows Phone 7 smartphone platform, in a bid to compete with Apple's (AAPL, Fortune 500) iPhone and Google's (GOOG, Fortune 500) Android.
EUR/USD continues to holds around $1.3530 area after the US trade report, looking for a driver. Focus remains on Egypt and that still supports dollar. Bids remain at $1.3500 with pptions there too. Resistance in the $1.3575/80 area of the Thursday lows.
07:00 Germany CPI (January) final -0.4% -0.5% 1.0%
07:00 Germany CPI (January) final Y/Y 2.0% 1.9% 1.7%
07:00 Germany HICP (January) final Y/Y 2.0% 2.0% 1.9%
07:00 Germany Wholesale prices (January) 1.2% 1.0% 1.8%
07:00 Germany Wholesale prices (January) Y/Y 9.4% 9.0% 9.5%
09:30 UK PPI (Output) (January) unadjusted 1.0% 0.5% 0.5%
09:30 UK PPI (Output) (January) unadjusted Y/Y 4.8% 4.4% 4.2%
09:30 UK PPI Output ex FDT (January) adjusted 0.7% 0.3% 0.2%
09:30 UK PPI Output ex FDT (January) unadjusted Y/Y 3.2% - 2.9%
09:30 UK PPI (Input) (January) adjusted 1.7% 0.9% 3.4%
09:30 UK PPI (Input) (January) unadjusted Y/Y 13.4% 12.0% 12.5%
The dollar rose as speculation turmoil in Egypt will get worse and a decline in global equities boosted demand for the safety of U.S. assets.
The greenback headed for a third weekly gain versus the euro after Egyptian President Hosni Mubarak defied calls for his immediate resignation, agreeing only to delegate powers until an election in September.
Mubarak said during a broadcast interview that he intended to stay on as president until the elections, while handing day- to-day powers to Vice President Omar Suleiman.
The MSCI Asia Pacific Index of shares fell 0.7%, the Stoxx Europe 600 Index slipped 0.7% and futures on the Standard & Poor’s 500 Index dropped 0.5%.
Dollar Versus Yen
Australia’s dollar weakened for a third day versus the greenback as Reserve Bank Governor Glenn Stevens said that there was no urgency to boost borrowing costs in the first half of the year, leading traders to cut bets on the amount of rate increases over the next 12 months.
EUR/USD weakened to the lows around $1.3504 and set stable within the $1.3504/30 range.
GBP/USD fell from $1.6070 to $1.5960 before recovered to $1.5995.
USD/JPY tested year's high on Y83.70 before retreated to current Y83.55.
The dollar was poised for a 1.7% weekly gain versus the yen, its biggest since Jan. 7, before a U.S. report economists said will show consumer confidence improved.
The Thomson Reuters/University of Michigan’s preliminary index of consumer sentiment rose to 75, the highest level since June, from 74.2 in January, according to the median forecast of economists.
EUR/JPY fell amid euro/dollar decline as US dollar index continues to rise. Lack of upside progress in dollar yen has sent the cross back through Y113.00 to Y112.83. Support seen now towards Y112.60/70, with stops below. Resistance above at Y113.40/45. Cross trades Y112.84/87.
EUR/USD printed a new low of $1.3512 with one trader reporting sizeable bids of $500m ahaed of the $1.3500 barrier. Also some Middle Eastern demand spotted towards $1.3510/15. Euro dollar now $1.3524/26.
© 2000-2020. All rights reserved.
This site is managed by Teletrade D.J. Limited 20599 IBC 2012 (First Floor, First St. Vincent Bank Ltd Building, James Street, Kingstown, St. Vincent and the Grenadines).
The information on this website is for informational purposes only and does not constitute any investment advice.
Making transactions on financial markets with marginal financial instruments opens up wide possibilities and allows investors who are willing to take risks to earn high profits, carrying a potentially high risk of losses at the same time. Therefore you should responsibly approach the issue of choosing the appropriate investment strategy, taking the available resources into account, before starting trading.
Use of the information: full or partial use of materials from this website must always be referenced to TeleTrade as the source of information. Use of the materials on the Internet must be accompanied by a hyperlink to teletrade.org. Automatic import of materials and information from this website is prohibited.
Please contact our PR department if you have any questions or need assistance at email@example.com.