CFD Markets News and Forecasts — 13-06-2014

Stock indices declined. Escalating violence in Iraq weighed on stock markets. The violence in Iraq could lead to disruptions in the oil supplies in OPEC’s second-biggest oil producer. U.S. president Barack Obama warned to use air strikes to help the government in Baghdad.

Eurozone’s trade balance surplus decreased to 15.7 billion euro in April from a surplus of 16.7 billion euro in March. March’s figure was revised down from a surplus of 17.1 billion to +16.7 billion. Analysts had expected a surplus of 16.3 billion euro.

The number of persons employed in the Eurozone climbed by 0.1% in the first quarter.

Indexes on the close:

Name                                   Price                                    Change                 Change %

FTSE 100                             6,777.85                              -65.26                        -0.95%

DAX                                      9,912.87                              -25.83                       -0.26%

CAC 40                                 4,543.28                              -11.12                       -0.24%

The U.S. dollar traded higher against the most major currencies despite the weaker-than-expected U.S. producer price index and consumer sentiment. The U.S. producer price index decreased 0.2% in May, missing expectations for a 0.1% increase, after a 0.6 rise in April. On a yearly basis, producer price index in the U.S. increased 2.0% in May, after a 2.1% gain in April.

The U.S. producer price index excluding food and energy declined 0.1% in May, missing expectation for a 0.2% rise, after a 0.5% gain in April. On a year-over-year basis, the producer price index excluding food and energy in the U.S. climbed 2.0% in May, after a 1.9% increase in April.

Reuters/Michigan consumer sentiment index for the U.S. fell to 81.2 in June from 81.9 in May, missing expectations for a rise to 83.2.

The euro declined against the U.S. dollar due to escalating violence in Iraq. Eurozone’s trade balance surplus decreased to 15.7 billion euro in April from a surplus of 16.7 billion euro in March. March’s figure was revised down from a surplus of 17.1 billion to +16.7 billion. Analysts had expected a surplus of 16.3 billion euro.

The number of persons employed in the Eurozone climbed by 0.1% in the first quarter.

German final consumer price index increased 0.9% in May, meeting expectations.

French final consumer price index decreased 0.1% in May, as expected.

The British pound mixed against the U.S. dollar. The British currency was supported by the yesterday’s comments of the Bank of England (BoE) Governor Mark Carney. He said the BoE may raise its key interest rate earlier than investors expected.

The Canadian dollar traded lower against the U.S. dollar after the weaker-than-expected manufacturing shipments in Canada. The manufacturing shipments in Canada fell 0.1% in April, missing expectations for 0.9% increase, after a 0.4% gain in March.

The New Zealand dollar traded lower against the U.S dollar due to the weaker economic data from New Zealand. The Bank of New Zealand-Business NZ's seasonally adjusted performance of manufacturing index (PMI) was 52.7 in May, after 54.4 in April. Figures above 50 indicates expansion and below 50 contraction.

Business New Zealand executive director for manufacturing Catherine Beard said the lower level of expansion in May was driven by the decreasing number of new orders.

Food prices index in New Zealand increased 0.6% in May. REINZ housing price index climbed 0.1% in May.

Market participants remained unimpressed by the better-than-expected economic data from China. Retail sales in China increased 12.5% in May, exceeding expectations for a 12.3% gain, after a 11.9% rise.

The Chinese industrial production rose 8.8% in May, meeting expectations, after a 8.7% increase.

The Australian dollar traded lower against the U.S. dollar in the absence of any economic reports in Australia.

The Japanese yen declined against the U.S. dollar after the Bank of Japan’s interest decision. The Bank of Japan kept its interest rate unchanged at 0.1%. The BoJ said it will continue to expand the monetary base at a pace of ¥60 trillion to ¥70 trillion per year. This decision was expected by market participants.

The industrial production (final) in Japan decreased 2.8% in April, missing expectations for a 2.5% decline, after a 2.5% decline in March. On a yearly, the Japanese industrial production increased 3.8% in April, missing expectations for a 4.1% gain, after a 4.1% rise in March.

The Bank of Japan kept its interest rate unchanged at 0.1%. The BoJ said it will continue to expand the monetary base at a pace of ¥60 trillion to ¥70 trillion per year. This decision was expected by market participants.

The Bank of Japan Governor Haruhiko Kuroda said on Friday the BoJ will maintain its stimulus measures at least another year to reach 2 percent inflation target. Japan is "only half way" towards achieving it inflation target, he added.

Mr. Kuroda pointed out that he saw no reason for the yen to strengthen against the euro. If the euro depreciated by 10% or 20%, the BoJ could act, he said.

He also said that Japan’s economy was recovering moderately and Japanese exports have been weaker than analysts’ forecast.

EUR/USD $1.3500, $1.3530, $1.3550, $1.3600

USD/JPY Y101.70-75, Y102.00, Y102.50-60

GBP/USD $1.6845

USD/CHF Chf0.9000

EUR/CHF Chf1.2200

AUD/USD $0.9375

NZD/USD $0.8600

USD/CAD C$1.0885, C$1.0900-05

U.S. stock-index futures were little changed as concern that violence in Iraq will disrupt oil supplies offset corporate deals and a rally in Intel Corp.

Global markets:

TOPIX 1,243.97 +6.22 +0.50%

SHANGHAI COMP 2,070.71 +19.00 +0.93%

HANG SENG 23,319.17 +144.15 +0.62%

DAX 9,878.62 -60.08 -0.60%

CAC 4,526.1 -28.30 -0.62%

FTSE 6,767.5 -75.61 -1.10%

Crude oil $106.85 (+0.31%)

Gold $1273.90 (-0.01%)

(company / ticker / price / change, % / volume)

Upgrades:

Intel (INTC) upgraded to Buy at Drexel Hamilton

Intel (INTC) upgraded to Equal-Weight from Underweight at Morgan Stanley

Intel (INTC) upgraded to Buy from Neutral at ROTH Capital

Downgrades:

Other:

Intel (INTC) target raised to $32 from $30 at FBR Capital

Intel (INTC) target raised to $40 from $35 at Jefferies

EUR/USD

Offers $1.3735, $1.3695/700, $1.3675, $1.3625, $1.3600/05

Bids $1.3500, $1.3475, $1.3400

GBP/USD

Offers $1.7100, $1.7030, $1.7000

Bids $1.6920, $1.6900, $1.6880, $1.6810/00

AUD/USD

Offers $0.9500, $0.9450, $0.9435

Bids $0.9350, $0.9335, $0.9300, $0.9255/50, $0.9235/30

EUR/JPY

Offers Y140.50, Y140.00, Y139.40, Y139.25, Y139.00

Bids Y137.70, Y137.00, Y136.20

USD/JPY

Offers Y103.50, Y103.00, Y102.75/80, Y102.35

Bids Y101.60, Y101.50/40, Y101.00

EUR/GBP

Offers stg0.8150, stg0.8100, stg0.8085, stg0.8060, stg0.8030

Bids stg0.7960, stg0.7910, stg0.7800, stg0.7760

Economic calendar (GMT0):

00:30    New Zealand   REINZ Housing Price Index, m/m      May        +0.1%                +0.1%

03:00    Japan             BoJ Interest Rate Decision                               0.10%   0.10%    +0.1%

03:00    Japan             Bank of Japan Monetary Base Target                270        270         270

03:00    Japan             BoJ Monetary Policy Statement                                                           

04:30    Japan             Industrial Production (YoY) (Finally)   April         +4.1%  +4.1%   +3.8%

04:30    Japan             Industrial Production (MoM) (Finally)  April         -2.5%   -2.5%    -2.8%

05:30    China              Retail Sales y/y                                  May         +11.9% +12.3% +12.5%

05:30    China              Industrial Production y/y                    May          +8.7%  +8.8%   +8.8%

05:30    France            Non-Farm Payrolls (Finally)               Quarter I   -0.1%   -0.1%    -0.1%

06:00    Germany         CPI, m/m (Finally)                              May          -0.1%   -0.1%    -0.1%

06:00    Germany         CPI, y/y (Finally)                                May         +0.9%  +0.9%   +0.9%

07:30    Japan             BOJ Press Conference                                              

09:00    Eurozone        Employment Change                          Quarter I    +0.1%  +0.1%   +0.1%

09:00    Eurozone        Trade Balance s.a.                             April           15.2      15.9       15.8

The U.S. dollar traded higher against the most major currencies due to escalating violence in Iraq and ahead of the U.S. producer price index and consumer sentiment. The U.S. producer price index should climbs 0.1% in May, after a 0.6 rise in April. The U.S. producer price index excluding food and energy should rise 0.2% in May, after a 0.5% gain in April.

Reuters/Michigan consumer sentiment index for the U.S. should increase to 83.2 in June from 81.9 in May.

The euro declined against the U.S. dollar. Eurozone’s trade balance surplus decreased to 15.7 billion euro in April from a surplus of 16.7 billion euro in March. March’s figure was revised down from a surplus of 17.1 billion to +16.7 billion. Analysts had expected a surplus of 16.3 billion euro.

The number of persons employed in the Eurozone climbed by 0.1% in the first quarter.

German final consumer price index increased 0.9% in May, meeting expectations.

French final consumer price index decreased 0.1% in May, as expected.

The British pound traded higher against the U.S. dollar. The British currency was supported by the yesterday’s comments of the Bank of England (BoE) Governor Mark Carney. He said the BoE may raise its key interest rate earlier than investors expected.

The Canadian dollar traded slightly lower against the U.S. dollar ahead of the manufacturing shipments in Canada. The manufacturing shipments in Canada should rise 0.9% in April, after a 0.4% gain in March.

EUR/USD: the currency pair declined to $1.3529

GBP/USD: the currency pair climbed to $1.6991

USD/JPY: the currency pair traded mixed

The most important news that are expected (GMT0):

12:30    Canada  Manufacturing Shipments (MoM)                                          April     +0.4%  +0.9% 

12:30    U.S.       PPI, m/m                                                                                May     +0.6%  +0.1% 

12:30    U.S.       PPI, y/y                                                                                  May     +2.1%                

12:30    U.S.       PPI excluding food and energy, m/m                                      May     +0.5%  +0.2% 

12:30    U.S.       PPI excluding food and energy, Y/Y                                       May     +1.9%                

13:55    U.S.       Reuters/Michigan Consumer Sentiment Index (Preliminary)   June      81.9      83.2

Stock indices decreased due to escalating violence in Iraq. The violence in Iraq could lead to disruptions in the oil supplies in OPEC’s second-biggest oil producer. U.S. president Barack Obama warned to use air strikes to help the government in Baghdad.

Eurozone’s trade balance surplus decreased to 15.7 billion euro in April from a surplus of 16.7 billion euro in March. March’s figure was revised down from a surplus of 17.1 billion to +16.7 billion. Analysts had expected a surplus of 16.3 billion euro.

The number of persons employed in the Eurozone climbed by 0.1% in the first quarter.

Current figures:

Name                                   Price                                    Change                 Change %

FTSE 100                             6,770.16                              -72.95                        -1.07%

DAX                                      9,846.78                              -91.92                       -0.92%

CAC 40                                4,517.04                               -37.36                       -0.82%

Asian stock increased due to signs of improving economic activity in China. Retail sales in China increased 12.5% in May, exceeding expectations for a 12.3% gain, after a 11.9% rise in April.

The Chinese industrial production rose 8.8% in May, meeting expectations, after a 8.7% increase in April.

Escalating violence in Iraq weighed on markets.

Indexes on the close:

Nikkei 225                         15,097.84                  +124.31             +0.83%

Hang Seng                         23,319.17                 +144.15             +0.62%

Shanghai Composite            2,070.71                   +19.00              +0.93%

Economic calendar (GMT0):

00:30    New Zealand   REINZ Housing Price Index, m/m       May        +0.1%                +0.1%

03:00    Japan             BoJ Interest Rate Decision                               0.10%   0.10%    +0.1%

03:00    Japan             Bank of Japan Monetary Base Target                270        270         270

03:00    Japan             BoJ Monetary Policy Statement                                                            

04:30    Japan             Industrial Production (YoY) (Finally)   April         +4.1%  +4.1%   +3.8%

04:30    Japan             Industrial Production (MoM) (Finally)  April         -2.5%   -2.5%    -2.8%

05:30    China              Retail Sales y/y                                  May         +11.9% +12.3% +12.5%

05:30    China              Industrial Production y/y                    May          +8.7%  +8.8%   +8.8%

05:30    France            Non-Farm Payrolls (Finally)               Quarter I   -0.1%   -0.1%    -0.1%

06:00    Germany         CPI, m/m (Finally)                              May          -0.1%   -0.1%    -0.1%

06:00    Germany         CPI, y/y (Finally)                                May         +0.9%  +0.9%   +0.9%

07:30    Japan             BOJ Press Conference                                               

09:00    Eurozone        Employment Change                          Quarter I    +0.1%  +0.1%   +0.1%

09:00    Eurozone        Trade Balance s.a.                             April           15.2      15.9       15.8

The U.S. dollar traded mixed against the most major currencies after the Thursday’s weaker-than-expected U.S. economic data. The U.S. retail sales increased 0.3% in May, missing expectations for a 0.5% gain, after a 0.5% rise in April. April’s figure was revised up to a 0.5% gain from an increase of 0.1%.

The U.S. core retail sales excluding automobile sales were up 0.1% in May, missing expectations for a 0.4% increase, after a 0.4% rise in April. April’s figure was revised up to 0.4% from 0%.

The U.S. Labor Department released the number of initial jobless claims on Thursday. The initial jobless claims in the week ending June 7 rose by 4,000 to 317,000. Analysts had forecasted a decline by 6,000 to 306,000.

The New Zealand dollar traded lower against the U.S dollar due to the weaker economic data from New Zealand. The Bank of New Zealand-Business NZ's seasonally adjusted performance of manufacturing index (PMI) was 52.7 in May, after 54.4 in April. Figures above 50 indicates expansion and below 50 contraction.

Business New Zealand executive director for manufacturing Catherine Beard said the lower level of expansion in May was driven by the decreasing number of new orders.

Food prices index in New Zealand increased 0.6% in May. REINZ housing price index climbed 0.1% in May.

Market participants remained unimpressed by the better-than-expected economic data from China. Retail sales in China increased 12.5% in May, exceeding expectations for a 12.3% gain, after a 11.9% rise in April.

The Chinese industrial production rose 8.8% in May, meeting expectations, after a 8.7% increase in April.

The Australian dollar traded mixed against the U.S. dollar in the absence of any economic reports in Australia.

The Japanese yen declined against the U.S. dollar after the Bank of Japan’s interest decision. The Bank of Japan kept its interest rate unchanged at 0.1%. The BoJ said it will continue to expand the monetary base at a pace of ¥60 trillion to ¥70 trillion per year. This decision was expected by market participants.

The industrial production (final) in Japan decreased 2.8% in April, missing expectations for a 2.5% decline, after a 2.5% decline in March. On a yearly, the Japanese industrial production increased 3.8% in April, missing expectations for a 4.1% gain, after a 4.1% rise in March.

EUR/USD: the currency pair traded mixed

GBP/USD: the currency pair increased to $1.6975

USD/JPY: the currency pair was up to Y101.95

The most important news that are expected (GMT0):

12:30    Canada  Manufacturing Shipments (MoM)                                          April     +0.4%  +0.9%  

12:30    U.S.       PPI, m/m                                                                                May     +0.6%  +0.1%  

12:30    U.S.       PPI, y/y                                                                                  May     +2.1%                 

12:30    U.S.       PPI excluding food and energy, m/m                                      May     +0.5%  +0.2%  

12:30    U.S.       PPI excluding food and energy, Y/Y                                       May     +1.9%                 

13:55    U.S.       Reuters/Michigan Consumer Sentiment Index (Preliminary)   June      81.9      83.2

EUR/USD $1.3500, $1.3530, $1.3550, $1.3600

USD/JPY Y101.70-75, Y102.00, Y102.50-60

GBP/USD $1.6845

USD/CHF Chf0.9000

EUR/CHF Chf1.2200

AUD/USD $0.9375

NZD/USD $0.8600

USD/CAD C$1.0885, C$1.0900-05

EUR / USD

Resistance levels (open interest**, contracts)

$1.3659 (2985)

$1.3615 (338)

$1.3589 (65)

Price at time of writing this review: $ 1.3555

Support levels (open interest**, contracts):

$1.3529 (1010)

$1.3509 (3715)

$1.3484 (4547)

Comments:

- Overall open interest on the CALL options with the expiration date July, 3 is 28268 contracts, with the maximum number of contracts with strike price $1,3700 (3377);

- Overall open interest on the PUT optionswith the expiration date July, 3 is 41355 contracts, with the maximum number of contractswith strike price $1,3500 (5244);

- The ratio of PUT/CALL was 1.46 versus 1.60 from the previous trading day according to data from June, 12

GBP/USD

Resistance levels (open interest**, contracts)

$1.7200 (1099)

$1.7101 (1320)

$1.7002 (2240)

Price at time of writing this review: $1.6957

Support levels (open interest**, contracts):

$1.6888 (159)

$1.6793 (1196)

$1.6697 (1519)

Comments:

- Overall open interest on the CALL options with the expiration date July, 3 is 16795 contracts, with the maximum number of contracts with strike price $1,7000 (2240);

- Overall open interest on the PUT optionswith the expiration date July, 3 is 18819 contracts, with the maximum number of contracts with strike price $1,6600 (2146);

- The ratio of PUT/CALL was 1.12 versus 1.19 from the previous trading day according to data from June, 12

* - The Chicago Mercantile Exchange bulletin (CME) is used for the calculation.

** - Open interest takes into account the total number of option contracts that are open at the moment.