Tag Archives: U.S. Housing Data

Euro Inches Away From 2 1/2-Month Lows

Here’s today’s ‘Just A Minute’ bringing you a 60 second summary of what’s happening in the financial markets:

WHAT WE’RE WATCHING TODAY

Euro Inches Away From 2 1/2-Month Lows

The euro staged a rebound today from a 2-1/2-month trough rising 0.1 percent to $1.3718. It had fallen as far as $1.3648 on Thursday, its lowest level since late February, in response to data showing the Eurozone grew much less than expected at the start of the year. The euro was down about 0.3 percent for the week at its current levels, putting it on track for its second straight weekly decline. The euro has fallen roughly 2 percent since May 8 when European Central Bank (ECB) President Mario Draghi persuaded markets that the bank was ready to inject fresh stimulus next month. The disappointing growth figures on Thursday only served to fuel those dovish expectations. The euro eased 0.1 percent to about 139.17 yen, not far from a 2-1/2-month low near 138.97 yen set on Thursday.

Stock Market Slumps As Economy Stuck In Low Growth

The big debate about the U.S. economy as the country emerges from the winter is whether the growth it has been experiencing is modest or accelerating. Recent figures show that recovery is “modest” which has big implications for stock prices. April Industrial Production, down 0.6 percent, was a big disappointment since it was only expected to be down 0.2 percent. That joins April Retail Sales, released on Tuesday, which were also disappointing. Bond yields are dropping in the U.S. and most of Europe, but importantly bond yields are higher in the periphery in Europe…in Italy, in Greece and in Spain. The final number we are looking for is April Housing Starts, out today. Starts are expected at 984,000, the best since December, but some are expecting more than 1.0 million Permits. The numbers so far have not been optimistic for housing. The NAHB Housing Market Index, an indicator of sentiment among home builders was also a disappointment, at 45, below expectations of 48. If we get disappointing Starts and Permits, could it be the nail in the coffin for a robust housing recovery this spring?

Gold Settles Lower After Jump In Consumer Prices

Gold prices on Thursday gave back some of the gains they notched a day earlier after a jump in consumer prices in the U.S. and a drop in jobless claims pointed to an economy on the mend, dulling the precious metal’s safe-haven appeal. Gold for June delivery fell $12.30, or 0.9%, to settle at $1,293.60 an ounce. This comes a day after the precious metal closed up $11.10, or 0.9%, at $1,305.90 an ounce. Gold reacted on the positive U.S. economic news of a lower reading of initial jobless claims which were below 300,000 - a positive sign for labour markets going forward. Consumer prices rose by 0.3% in April to mark the biggest gain since June, with core prices up 0.2%, while jobless claims fell to the lowest level since 2007. Analysts say jobless claims and CPI data have triggered a shift in sentiment for markets. Traders are punishing gold on the back of this data as it shows an improvement in the economic growth.

That sums up today’s highlights! Don’t forget you can stay in touch via our social media channels for all your up-to-the-the minute trading news. We hope you have a profitable day on the markets.

Lackluster U.S. Home Sales For March

Here’s today’s ‘Just A Minute’ bringing you a 60 second summary of what’s happening in the financial markets:

Main Trading Event Of The Day: USD Existing Home Sales @ 14.00 GMT

WHAT WE’RE WATCHING TODAY

Lackluster U.S. Existing Home Sales Expected For March

Monthly sales data due today is expected to reveal lackluster rates in March as existing home sales likely fell by 1.0% to a 4.57 million unit rate. Pending home sales have remained weak, with a 0.8% decline in February after a 0.2% decline in January, suggesting limited momentum for completed sales. Total housing inventory was up in February, although the number of homes for sale was still low, indicating that constraints on the supply side are also likely to continue to hold back the sales pace. Analysts are, however, expecting a sharp spring rebound with some strengthening in home sales as an increase in projects and purchases delayed by bad weather proceed.

Is The Long Bull Market Set For A Summer Correction?

As the markets head towards the summer, analysts are becoming increasingly concerned that the long bull market in stocks is set for a correction. The S&P is now nearly 1 percent higher for the year, after rising around 30 percent last year, but it is still down over 1 percent from the all-time high it reached in early April. The Dow Jones Industrial Average is off around 1 percent this year, after climbing over 22 percent last year. Market watchers point out that the market could react to any number of factors, such as an escalation of tensions in Ukraine, deleveraging in China or even if the Federal Reserve’s moves to taper its asset purchases prove to be too fast. A correction could be as much as 8 percent over a four to six week period. Earlier this month we experienced a correction in social media stocks with high-flying momentum names in Internet and social media sectors sold off sharply. The Nasdaq index dropped as much as 9.7 percent from its March high, flirting with the official correction level of 10 percent, before retracing some losses. The index is still down nearly 4 percent from its early April high. Many U.S. listed technology stocks entered a bear market, experiencing a loss of at least 20 percent, with more funds flowing into stocks considered defensive or lower risk. If conditions deteriorate, analysts expect the Fed may hold off on tapering which would boost prices again, while noting the correlation between the Fed’s moves to increase its balance sheet by buying assets and gains in stocks is around 90 percent.

Apple Among Top Tech Market-Value Losers As Facebook Posts Gains

The technology selloff has seen off large chunks of value, highlighted by big market cap drops in the sector’s high-fliers led by Apple and Amazon. Apple has shed about $28 billion in market cap since the beginning of the year, a 6% drop as Twitter’s market value has fallen 26%, as its market capitalisation fell by $9 billion. Other big name technology stocks have seen substantial cuts in market value: LinkedIn fell by nearly $5 billion, or a loss of 18% while Yahoo dropped by $4.5 billion. A notable exception in the downward trend is Facebook which has seen its market value grow by nearly $15 billion, or 11%, since the beginning of the year. Investors appear to be turning to more mature tech powerhouses amid the uncertainty, for example, Microsoft, which has seen its market value climb 7% by $22 billion. According to analysts, there is something of a bubble going on in tech, and with those except Apple who have really high multiples, it is easy to see how concerns about an overheated market would cause people to flee high-multiple stocks and to seek refuge in lower-multiple stocks.

That sums up today’s highlights! Keep up with all the latest trading events of the day via our social media channels - we’re on Facebook, Twitter, Google+ & LinkedIn.

We hope you have a profitable day on the markets!

U.S. Data Reveals Interesting Picture Of Homeownership

A recently released report provides in-depth information regarding US household net worth. According to the Federal Reserve Bank, US household net worth grew by $3 trln and now sits at over $80 trln in total. This information purportedly paints a rosy picture for citizens in the US, but what does the data mean? Once a little digging is done, the facts are perhaps less flattering with the jury out on what all the data means. Banc De Binary Founder, Oren Laurent, shares his thoughts on the matter in this very informative article. Read more…

Just A Minute!

Here’s Tuesday’s ‘Just A Minute’ bringing you a 60 second summary of what’s happening in the markets:

Main Trading Events Of The Day: EUR German ZEW Economic Sentiment @ 10.00; USD Building Permits @ 12.30; USD Core CPI m/m @ 12.30 GMT

WHAT WE’RE WATCHING TODAY

U.S. Markets Look To German Stocks As German ZEW Economic Sentiment Awaited

Markets around the world have been becoming more jittery by the Russia/Ukraine crisis and the possibility of slowing economic growth in China. The situation is having a profound impact on U.S. markets with traders up and down Wall Street pointing to a renewed sense of risk aversion and questioning whether or not this is the beginning of that long-awaited correction for U.S. stocks. Slowing growth in China and worries about Russia’s tense relationship with Ukraine continue to fester but many traders have been paying even more attention to what’s happening in continental Europe for signs of what’s ahead for U.S. stocks. In particular, they are looking at Germany’s stock market which has relatively close economic ties to Russia. The two are trading partners, so weakness in Russia’s markets will reverberate through Germany’s markets to a certain degree. In turn, Germany is an important trading partner with the U.S. and there is a very high correlation between the value of the S&P 500 and Germany’s DAX stock index. In other words, the direction of both indexes seems to track each other fairly closely, hence many traders are also keeping a close eye market developments in Germany. While there has been selling pressure on U.S. stocks, some traders note that there isn’t a sense of panic selling. They also note that the current downside pressure isn’t a result of a massive flood of sell orders hitting the market. Rather, it’s been a lack of any real buy orders. With stocks near record highs, caution is still the prevailing sentiment. However, the trading relationship between German and American stocks is perhaps one reason why some traders are taking some profits just in case the global geopolitical or economic situation takes a turn for the worse.

The importance of the German market is once again highlighted in today’s German ZEW Economic Sentiment @ 10.00 GMT. Economic expectations in the euro zone declined in February by 5.4 points to 68.5. Analysts had expected a higher reading of 73.9. The decline in sentiment may attributed to concerns about U.S. economic recovery, and market volatility in emerging markets. Despite the relatively weak reading, ZEW President Clemens Fuest believes this decline in economic expectations is a temporary setback, since the majority of surveyed financial market experts remain optimistic. A further decline to 67.3 is expected.

Markets Eye Housing Data & FOMC For Market Buzz

Economic data and the Federal Reserve are expected to receive most of Wall Street’s attention this week with the big question being whether we are we looking at ongoing weather-related data, or if we are likely to see incremental improvement. Traders will of course be keeping their eyes on the Ukraine but it may come off the trader screen for the next few days, as we head to the FOMC on Wednesday. Reports scheduled for release include the consumer price index, typically scrutinised by analysts and investors for any sign of inflation, along with housing starts and building permits, all for February. The report, along with one on mortgage applications on Wednesday and existing home sales on Thursday, should give investors a clearer view on the health of the housing sector, an important piece of the U.S. economy. The expectations there a little stronger than they have been with the addition of 175,000 jobs in February and separately, a 0.3 percent rise in retail sales last month. The economic reports should begin to answer whether equity investors made the right call in writing off a large number of economic reports as being adversely affected by the weather. On Monday, stocks rallied, with the Dow rebounding from a five-day losing streak, as voting in Crimea passed without violence and after economic report had U.S. manufacturing output jumping the most in six months.

Apple Favorite Brand In Emerging Markets

Apple is the most desirable mobile-phone brand among inhabitants of emerging markets, according to a report. In a study conducted this year, Apple edged out Samsung Electronics, which was the leader in a separate survey last year. Samsung saw a slight decline in its share of developing-market consumers who favour its phones from 32 percent to 29 percent while Apple’s share jumped dramatically from 21 percent to where Samsung was last year. The brand halo for Apple is a good thing, but it won’t help the company overtake Samsung in sales, at least not immediately. Samsung Electronics is the world’s largest maker of smartphones partly because it makes low-margin, cheap handsets in addition to Galaxy products. The bright side for Apple is that the new emerging middle classes may switch to iPhones when they can afford them.

That sums up today’s highlights! Keep an eye on the markets today for important data releases via our Facebook, Twitter, Google+ and LinkedIn pages. We hope you have a profitable day on the markets!

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