UK Spread Betting Markets Struggle as Eurozone Concerns Persist
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 - 29 December 2011
UK Trading Review
The UK spread betting markets closed on a mixed note yesterday, with the FTSE 100 index ending lower, as persistent worries about the eurozone debt crisis, overshadowed optimism over successful Italian short-term bond auction.
Lloyds Banking Group, Royal Bank of Scotland and Barclays lost between 2.6% and 3.8%, as risk appetite decreased among investors.
Steelmaker, Evraz, the top decliner on the FTSE 100 index, tumbled 4.9%, after it was forced to halt its underground mining operation in Siberia following an earthquake.
BP and Tullow Oil declined 0.9% and 1.7%, respectively, as crude oil prices lost ground.
International Consolidated Airlines Group fell 2.3%, ahead of a strike by pilots from the companyís Iberia airline.
However, Wm Morrison Supermarkets and Tesco gained 0.1% and 2.3%, respectively, boosted by post-Christmas sales.
FTSE 100 edged down 0.1% to close at 5,507.4, while FTSE 250 ticked up 0.3% to settle at 10,013.2.
European Trading Review
European markets ended lower yesterday, amid lingering concerns over the European debt crisis, after the ECBís balance sheet showed that it had significantly boosted lending to banks, overshadowing optimism that Italyís borrowing costs had dropped at the recent debt auction.
Financial stocks, Commerzbank, Credit Agricole and UniCredit, fell between 1.0% and 4.2%, as risk appetite decreased among investors.
Deutsche Boerse fell 4.0%, after the company stated that it was extending the deadline to complete its merger with NYSE Euronext to 31 March.
Carmakers, BMW and Daimler sank 3.3% and 3.9%, respectively, amid worries over demand prospects.
Steelmakers, ThyssenKrupp and Salzgitter edged down 2.5% and 2.6%, respectively, tracking lower base metal prices.
FTSEurofirst 300 index dropped 0.7% or 7.0 points to settle at 983.3. German DAX Xetra 30 fell 2.0% or 118.5 points to end at 5,771.3. French CAC-40 declined 1.0% or 32.0 points to 3,071.1.
US Trading Review
In US shares financial spread trading, the markets fell sharply yesterday, after data showed that the European Central Bankís lending to regional banks had surged to a record, and as investors remained concerned about Italyís long-term debt auction.
Cliffs Natural Resources, the biggest decliner on the S&P 500 index, tumbled 4.6%, while Denbury Resources, Alpha Natural Resources and Tesoro declined between 2.9% and 4.2%, as crude oil prices dropped.
Molycorp plunged 14.1%, as China raised its export quota for rare earth minerals.
Bank of America and JP Morgan Chase dropped 3.6% and 1.2%, respectively, as risk appetite decreased among investors.
Citigroup retreated 2.9%, after it decided to sell its Belgian retail unit.
DJIA declined 1.1% to close at 12,151.4. NASDAQ shed 1.3% to settle at 2,590.0. S&P 500 fell 1.2% to 1,249.6.
Forex Trading Review
At 0400 BST today, the GBP is trading 0.1% higher against the USD at $1.5452, 0.1% higher against the EUR at Ä1.1955, and 0.1% lower against the JPY at ¥120.21.
The EUR is trading marginally higher against the USD at $1.2925. Earlier, the EUR was trading lower against the USD, ahead of Italyís long-term bond auction.
The EUR is trading 0.2% lower against the JPY at ¥100.56, amid speculation that the ECB would continue to inject cash into the financial system to avoid a credit crunch from the regionís debt crisis.
Also in forex spread trading, the JPY is trading higher against the USD, amid reports that the US Treasury had criticized Japan for intervening in the currency market and selling ¥9.092 trillion from 28 October to 28 November.
The AUD and the NZD are trading lower against the USD, as a drop in global equity markets decreased demand for high yielding currencies.
Yesterday, the USD ended higher against most of the major peers, after data showed that the ECBís balance sheet had surged to a record high, as lending to regionís banks jumped to Ä879 billion from Ä214 billion in one week.
The CAD closed higher against the USD, after Italyís borrowing costs dropped at the recent debt auction.
Commodities Trading Review
In Asia, crude oil for February delivery is trading 0.2% or $0.19 higher at $99.55 per barrel.
Yesterday, crude oil for February delivery slid 2.0% or $1.98 to settle at $99.36 per barrel, after the American Petroleum Institute report showed that crude-oil inventories climbed by 9.6 million barrels for the week ended December 23.
Crude oil also lost value as the dollar gained against the euro, decreasing the demand for the commodities as an alternative investment.
Gold for immediate delivery is trading 0.1% higher today, at $1,556.69 per ounce.
Gold futures for February delivery fell 2.0% or $31.40 to settle at $1,564.10 per ounce yesterday, as the dollar continued to appreciate against the major currencies, decreasing the demand for the precious 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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Article provided / approved by ETX Capital which is the trading name of Monecor (London) Limited, company number 00851820. Monecor (London) Ltd is authorised and regulated by the Financial Services Authority, registration number 124721.
'UK Spread Betting Markets Struggle as Eurozone Concerns Persist' edited by ETX Capital, updated 29-Dec-11
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