FX Spread Betting: AUD/USD Slips on Concerns Ahead of Greek Elections
The regular trading review of the main UK, US and European markets, plus a quick look at the commodities and forex markets.
For today's report see Financial Trading Review.
Financial Trading Review - 14 June 2012
UK Trading Review
UK spread betting markets closed on a mixed note yesterday, with the FTSE 100 index closing almost flat, as borrowing costs rose at debt auctions by Italy and Germany and after US retail sales dropped in May for the second straight month.
Fresnillo, the top gainer on the FTSE 100 index, advanced 4.1%, as silver showed gains during the London session. Shares of drug maker, Shire and insurer, Resolution, benefited from broker upgrades.
British Sky Broadcasting rallied 1.4%, amid hopes that it would be awarded a major chunk of Premier League football rights for telecasting. Utility, SSE gained 2.1%, on favourable reviews from Barclays and Exane BNP Paribas.
Gains in the FTSE 100 were kept in check as Xstrata and Glencore International registered losses, on fears that shareholders would block their merger. Cairn Energy fell 1.1%, as it agreed to acquire North Sea oil producer Nautical Petroleum.
FTSE 100 edged up 0.2% to settle at 5,483.8, while FTSE 250 edged down 0.2% to close at 10,538.6.
European Trading Review
European markets closed in the negative territory yesterday, amid a rise in Italian and German bond yields at debt auctions and after US retail sales fell for a second consecutive month in May.
Industrial sector stock, SKF, slumped 7.3%, after the company revealed “slightly lower” second quarter demand for its products and services on an annual basis, while Konecranes, Schneider Electric and Alstom, sank between 5.0% and 7.0%.
Carmakers, Daimler, Volkswagen and Renault lost between 1.8% and 4.2%, after Renault’s CEO, Carlos Ghosn, issued cautious comments on European auto industry.
Tyre makers, Pirelli, Michelin & Cie and Continental, fell between 2.1% and 3.5%, after Morgan Stanley highlighted that tyre volumes were “not picking up and mass pricing is on its way down”.
Siemens declined 1.9%, after UBS removed the stock from its “European Key Call List”.
FTSEurofirst 300 index eased 0.3% to 987.0. German DAX Xetra 30 dropped 0.1% to 6,152.5. French CAC-40 closed 0.6% lower at 3,030.0.
US Trading Review
US markets closed lower yesterday, following a drop in retail sales in May for the second month in a row. Mounting borrowing costs for Italy and Germany coupled with concerns over the outcome of Greek election also weighed on the risk appetite.
Auto insurer, Progressive slipped 4.4%, as claims costs rose above the company’s target.
Lawn & garden company, Scotts Miracle-Gro declined 6.6%, as it stated that it would miss its full-year target, amid sluggish demand and after RBC slashed its price target.
American Express dropped 2.4%, amid a drop in credit-card spending for April and May. Broker downgrades spurred a sel-loff in shares of Chesapeake Energy and Urban Outfitters.
DJIA fell 0.6% to 12,496.4. NASDAQ slipped 0.9% to 2,818.6. S&P 500 slid 0.7% to 1,314.9.
Forex Trading Review
At 0400 BST today, the GBP is trading marginally down against the USD at $1.5519, 0.1% higher against the EUR at €1.2354, and slightly up against the JPY at ¥123.25.
The EUR is trading 0.1% lower both against the USD and JPY at $1.2562 and ¥99.76 respectively, ahead of today’s Italian debt auction and Greek elections on 17 June.
The USD traded initially lower against the JPY, as investors speculated that the US Federal Reserve would expand its monetary policy if an upcoming report shows that the US consumer prices fell in May.
The NZD is trading higher against most of its major peers, after the Reserve Bank of New Zealand left the benchmark interest rate unchanged at 2.5%.
Yesterday, the EUR closed higher against the USD, amid mounting speculation that Greece might seek to modify its austerity program following the 17 June election in an effort to remain in the monetary bloc.
Elsewhere in FX spread betting, the AUD finished lower against the USD, as a drop in the US retail sales and rising concerns due to looming Greek elections, dampened demand for high yielding assets.
The CAD ended lower against the USD, following the Commerce Department report that showed a 0.2% decrease in the retail sales in May for US, Canada’s largest trading partner.
Commodities Trading Review
In Asia, crude oil for July delivery is trading 0.3% or 27 cents higher at $82.89 per barrel.
Yesterday, crude oil for July delivery fell 0.8% or 70 cents to settle at $82.62 per barrel, an eight month low. This came amid sluggish fuel energy demand prospects, following a decline in the US retail sales and producer prices data for May.
However, losses were limited, after the US Energy Information Administration reported that crude oil inventories fell by 200,000 barrels for the week ended 8 June.
Meanwhile, the International Energy Agency slashed its estimate by 100,000 barrels from its May prediction to 89.9 million barrels per day for 2012 crude oil consumption, reflecting an increase of 820,000 barrels from last year.
Gold for immediate delivery is trading marginally lower today, at $1617.16 per ounce.
Gold for August delivery rose 0.4% or $5.60 to settle at $1,619.40 per ounce yesterday. This came as the dollar depreciated against the euro, after investors speculated further quantitative easing by the US Federal reserve following weak retail sales data.
As a result, demand had has increased for the yellow metal as a hedge against inflation.
Financial Trading News
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The above comments do not constitute investment advice and neither ETX Capital nor Clean Financial accept any responsibility for any use that may be made of them. Any prices or data are indicative and subject to change without notice; its accuracy is not guaranteed and should not be relied on.
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'FX Spread Betting: AUD/USD Slips on Concerns Ahead of Greek Elections' edited by ETX Capital, updated 14-Jun-12
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