Best of the Week
Most Popular
1. Investing in a Bubble Mania Stock Market Trending Towards Financial Crisis 2.0 CRASH! - 9th Sep 21
2.Tech Stocks Bubble Valuations 2000 vs 2021 - 25th Sep 21
3.Stock Market FOMO Going into Crash Season - 8th Oct 21
4.Stock Market FOMO Hits September Brick Wall - Evergrande China's Lehman's Moment - 22nd Sep 21
5.Crypto Bubble BURSTS! BTC, ETH, XRP CRASH! NiceHash Seizes Funds on Account Halting ALL Withdrawals! - 19th May 21
6.How to Protect Your Self From a Stock Market CRASH / Bear Market? - 14th Oct 21
7.AI Stocks Portfolio Buying and Selling Levels Going Into Market Correction - 11th Oct 21
8.Why Silver Price Could Crash by 20%! - 5th Oct 21
9.Powell: Inflation Might Not Be Transitory, After All - 3rd Oct 21
10.Global Stock Markets Topped 60 Days Before the US Stocks Peaked - 23rd Sep 21
Last 7 days
AI Tech Stocks State Going into the CRASH and Capitalising on the Metaverse - 25th Jan 22
Stock Market Relief Rally, Maybe? - 25th Jan 22
Why Gold’s Latest Rally Is Nothing to Get Excited About - 25th Jan 22
Gold Slides and Rebounds in 2022 - 25th Jan 22
Gold; a stellar picture - 25th Jan 22
CATHY WOOD ARK GARBAGE ARK Funds Heading for 90% STOCK CRASH! - 22nd Jan 22
Gold Is the Belle of the Ball. Will Its Dance Turn Bearish? - 22nd Jan 22
Best Neighborhoods to Buy Real Estate in San Diego - 22nd Jan 22
Stock Market January PANIC AI Tech Stocks Buying Opp - Trend Forecast 2022 - 21st Jan 21
How to Get Rich in the MetaVerse - 20th Jan 21
Should you Buy Payment Disruptor Stocks in 2022? - 20th Jan 21
2022 the Year of Smart devices, Electric Vehicles, and AI Startups - 20th Jan 21
Oil Markets More Animated by Geopolitics, Supply, and Demand - 20th Jan 21
WARNING - AI STOCK MARKET CRASH / BEAR SWITCH TRIGGERED! - 19th Jan 22
Fake It Till You Make It: Will Silver’s Motto Work on Gold? - 19th Jan 22
Crude Oil Smashing Stocks - 19th Jan 22
US Stagflation: The Global Risk of 2022 - 19th Jan 22
Stock Market Trend Forecast Early 2022 - Tech Growth Value Stocks Rotation - 18th Jan 22
Stock Market Sentiment Speaks: Are We Setting Up For A 'Mini-Crash'? - 18th Jan 22
Mobile Sports Betting is on a rise: Here’s why - 18th Jan 22
Exponential AI Stocks Mega-trend - 17th Jan 22
THE NEXT BITCOIN - 17th Jan 22
Gold Price Predictions for 2022 - 17th Jan 22
How Do Debt Relief Services Work To Reduce The Amount You Owe? - 17th Jan 22
RIVIAN IPO Illustrates We are in the Mother of all Stock Market Bubbles - 16th Jan 22
All Market Eyes on Copper - 16th Jan 22
The US Dollar Had a Slip-Up, but Gold Turned a Blind Eye to It - 16th Jan 22
A Stock Market Top for the Ages - 16th Jan 22
FREETRADE - Stock Investing Platform, the Good, Bad and Ugly Review, Free Shares, Cancelled Orders - 15th Jan 22
WD 14tb My Book External Drive Unboxing, Testing and Benchmark Performance Amazon Buy Review - 15th Jan 22
Toyland Ferris Wheel Birthday Fun at Gulliver's Rother Valley UK Theme Park 2022 - 15th Jan 22
What You Should Know About a TailoredPay High Risk Merchant Account - 15th Jan 22
Best Metaverse Tech Stocks Investing for 2022 and Beyond - 14th Jan 22
Gold Price Lagging Inflation - 14th Jan 22
Get Your Startup Idea Up And Running With These 7 Tips - 14th Jan 22
What Happens When Your Flight Gets Cancelled in the UK? - 14th Jan 22

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Stock Markets Surreal Trading Day

Stock-Markets / Financial Markets 2009 Jun 26, 2009 - 03:59 AM GMT

By: PaddyPowerTrader

Stock-Markets

Best Financial Markets Analysis ArticleA bizarre whacko day that will be remembered more for the passing of the brilliant boy who never quiet grew up, the iconic M.J. and the former darling of the bedroom 1970’s walls, the angelic Farah Fawcett. In the markets the S&P had a surreal day, surging over 2% on no real news or catalyst. Indeed what data we got to digest was disappointing (particularly the renewed rise in the weekly jobless claims).


Month end rebalancing and rotation into relative strength names, half year end window dressing and some positive noises from home builder Lennar are probably the most likely culprits as opposed to delayed reaction to the FOMC announcement the previous evening or perky results from retailer Bed Bath & Beyond which most amateur hour commentators are hailing today.

Today’s Market Moving Stories

  • Japanese consumer prices fell a record 1.1% in the year to May, with falling demand increasingly blamed as the country’s second bout of deflation in less than two years deepens. The slide may make the Bank of Japan less willing to end unconventional policies due to expire in September. It was the largest fall in records dating back to 1970 but slightly less than a consensus forecast for a 1.2 percent decline. Staying in Japan, authorities are set to order Citigroup to suspend some of its retail business in Japan for lax oversight against money laundering, two people familiar with the matter said.
  • Asian share markets rose overnight, as higher oil and metals prices boosted resource stocks. Nippon Oil Corp jumped over 4% after a newspaper reported that it and other Japanese companies were in the final stage of talks with Iraq to win the development contract for Iraq’s huge Nassiriya oilfield. Suzuki Motor climbed 5.5% after a source familiar with the matter said Volkswagen was exploring a potential cooperation deal with Suzuki as a way to boost its expertise in the area of ultra-small cars according to Reuters.
  • Chinese industrial profits fell 22.9% yoy in May, up from -37.3% yoy in February, only the second annual fall in the quarterly series since data available in 2006.
  • In what looks like a panic move, Swiss bank UBS, one of the world’s hardest-hit major banks in the global financial crisis, said that it plans to raise about $3.8bn by selling stock, and expects to post a second-quarter net loss. The world’s largest wealth manager by assets is trying to bolster capital and return to profitability after in 2008 suffering the biggest annual loss in Swiss corporate history, hurt by more than $50bn of write-downs tied significantly to investments in risky U.S. assets. UBS said it is offering about 293.3mln new shares at a price of 13.00 Swiss francs per share, a 6.9% discount to Thursday’s closing price of 13.97. Shares were down 6% Thursday ahead of the announcement!
  • The FT reports that Germany’s BGA exporters’ association have forecast a “dramatic deterioration” in credit conditions in coming months, which would result in “massive financing squeeze”. It quotes the president of the association as saying that there are already difficulties for middle- and long-term credit. And the banks are now beginning to squeeze out short-term credit.
  • There is an interesting comment from Alan Greenspan about the interrelationship between equity prices and the economy. He starts by saying that the March-to mid-June rise in equity prices was the main reason for the green shoots, as the $12 trillion of new corporate equity value added to the capital buffer that supports the issue of debt. He says he accords a much larger economic role to equity prices than is the conventional wisdom. He says they are not merely an important leading indicator of global business activity, but a major contributor to that activity, operating primarily through balance sheets.
  • The French car industry is going down with 20,000-30,000 job losses expected this year, more than 10% of the workforce in the car industry. The insurer Euler Hermes estimates that more than 400 suppliers could go out of business. At Renault, the production is running at 50% of capacity. Hermes recommends more presence in emerging markets and new alliances to cut costs, nothing of which is about to happen.
  • Irish Life & Permanent (ILP) had their credit rating cut by the trigger happy Standard & Poor’s rating agency to the lowly depths of BBB+ due to perceived over reliance on scarce wholesale (inter bank) funding, asset quality deterioration and a weak business very much propped up by the insurance unit. It’s worth noting though that ILP was the one that did not lend to developers so has no assets going into NAMA. It also has strong capital-c.9% core T1 and a pretty low risk balance sheet. Stable outlook reflects government support expectation beyond the 29 Sept 2010 guarantee period.
  • Bucking the trend, Fyffes has raised its profit target UP. It is moving its 2009 adjusted EBIT target from a €14-18m range to €16-€20m. Bananas indeed. Later today Nielsen will let us know how drinks maker C&C is faring in recent weeks. The good weather and the new pricing policy along with the very tasty new pear cider should have helped push up volumes methinks.
  • US crude oil futures pushed on above $70 a barrel on renewed rebel attacks against oil facilities in Nigeria and worries that a glitch at the largest US oil refinery may tighten gasoline stockpiles.
  • Looking for something different for the family forthnight in August? Luxury ocean liners in Russia are offering pirate hunting cruises aboard armed private yachts off the Somali coast.
  • Pensioner abducted financial adviser after he lost £2m savings.

Bank Of England’s Financial Stability Report
British banks look in better shape than six months ago but are still vulnerable to economic shocks, the Bank of England said as it set out a raft of proposals to toughen up financial regulation. Banks are finding it slightly easier to raise money and have benefited from rising asset prices over the past three months, but are still heavily indebted and lack secure long-term funding. The BoE also set out in detail its call for global action against banks currently deemed too big to be allowed to fail, just days before the British government is expected to publish regulatory proposals on which BoE Governor Mervyn King pointedly noted on Wednesday that he had not yet been consulted on. “Regulators should ensure that banks’ resilience is commensurate with the costs that failure could impose on the financial system as a whole. This would mark a step change from the current approach, which has been largely orientated towards protecting depositors,” the report said.

Data Ahead Today
Today we get German CPI for June. Following the release of the inflation numbers for the German state of Saxony, the market has revise down their forecast for CPI and HICP to 0.2% mom and 0.3% mom respectively. On these forecasts annual CPI and HICP inflation would fall to -0.1%, in negative territory for the first time since 1953!

At 13:30 US Personal Income and Outlays for May which should show that personal income has been flat on the month.

US University of Michigan Consumer Sentiment for June at 15:00 should remain unrevised at 69.0.

And Finally… The Wall Street Pro Has Some Female Competition


Disclosures = None

By The Mole
PaddyPowerTrader.com

The Mole is a man in the know. I don’t trade for a living, but instead work for a well-known Irish institution, heading a desk that regularly trades over €100 million a day. I aim to provide top quality, up-to-date and relevant market news and data, so that traders can make more informed decisions”.

© 2009 Copyright PaddyPowerTrader - All Rights Reserved
Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

PaddyPowerTrader Archive

© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in