Tag Archives: Japanese yen

Friday Premarket Recap: Surprising Strength Following G7 Agreement on Yen Intervention

HedgeFundLIVE.comMorning Notes

- Major headline of the night was that the G7 agreed on a Yen intervention (or “Yen-tervention, as Dean likes to call it) to weaken the currency- financial institutions will have to repatriate funds to pay for insurance claims and reconstruction
- Nikkei closed up 2.7% while the yen sold off aggressively
- UN authorized military strikes against Gaddafi forces- oil has rallied
- The no fly zone vote passed with 10 UN votes and no opposing votes- however, a few countries (e.g., Germany, Russia, India, China, and Brazil) abstained from voting
- Details of no fly zone policy to be cranked out
- Nothing extreme in Manama, Bahrain this morning as large number of security forces remain in the streets
- Regarding nuclear situation in Japan: Japan increased alert level up to 5 from 4 (out of 7 point scale
- A little past 8:39a ET, Libyan Foreign minister announced Libya will close all air space and has decided on an immediate ceasefire
- China increased reserve requirement ratio by 50bps
- No economic data releases scheduled for today


Nonfarm Payrolls Yield Choppy Market Action

HedgeFundLIVE.com - Morning Notes

- Strength across the board again in overseas markets this morning
- All Asian indices closed up strong: Shanghai up 1.4%, Nikkei up 1.0%
- Perhaps in catch up mode after yday’s strength in US markets
- Japanese yen was weak, which helped boost the Nikkei
- Note that the China markets opened weak, but was able to bounce off its lows
- UK Halifax Housing Price number came in worse than expected
- Oil still clearly strong, oil did print new highs overnight
- Fighting in Libya continues, more bombings in Marsa el_brega, the oil town
- The grand old Chavez peace plan pretty quiet and vague, as expected (see my blog from yesterday)
- Reports that Tripoli may be next target
- Protestors in Saudi Arabia are demanding relase of some Shiite prisoners
- Rebels in Yemen saying gov’t forces fired on their protest and killed two people
- Gold up small
- Feb. Nonfarm Payrolls: 192K vs. 196K; prior revised up to 63K from 36K
- Feb. Nonfarm Private Payrolls: 222K vs. 200K; prior revised up to 68K from 50K
- Feb. Unemployment Rate: 8.9% vs. 9.1%
- 8.9% unemployment rate is lowest since April 2009
- Futures initially spiked, but then pulled back following the payrolls data
- January Factory Orders out at 10a, not expecting this number to really move the markets


Leaked China CPI Number Boost Chinese Stocks

Morning Notes

- China CPI number appears to have been leaked a day early- the rumor, which was probably leaked by a PBOC source, is that the CPI number would be in line (+4.6%)
- Recall: last month China CPI came in notably higher than expected at +5.1%
- A controlled CPI number would stem the need for further tightening in China
- The leaked data boosted indices in Asia, with the Shanghai Comp closing up nearly 2%, Hang Seng up 1.1%
- Nikkei was up 40bps- tech stocks were strong following solid IBM and AAPL earnings last night
- Japanese yen showed some strength, hindering further gains in the Nikkei
- Europe trading mixed to relatively flat this morning- the bourses have pulled back from opening highs
- There was a report out that Germany is looking at the potential effects of a debt restructuring
- Also there was a relatively successful 1 yr debt auction in Portugal
- Dollar seeing further weakness
- December Housing Starts: 529K vs. 550K
- December Building Permits: 635K vs. 554K
- December Housing Starts m/m: -4.3%
- December Building Permits m/m: +16.7%
- S&P futures down about 4 handles from FV
- Fairly tight pivots for the Spooz today
- Spooz on the S3 buy signal, trading between S4 and S3

Strength Carrying Over From Yesterday’s Rally

Morning Notes

- Seeing strength again in the pre today
- In China, reports out that the gov’t may delay property tax pmts because of internal disputes, whatever that means
- Weakness in Japanese yen helped lift the Nikkei, which was closed yday and closed up 1.7% today
- Unemployment rate in Germany came in unch’d while number of those unemployed actually increased
- UK PMI came in better than expected
- FT article that the candidate that will likely become China’s premier in two years, Li Keqiang, committed the country to buy more Spanish gov’t bonds
- Eurozone CPI came in higher than expected (is now higher than ECB tgt)
- Gold is lower this morning
- Dollar is lower as well
- We have factory orders out at 10a ET
- Also have the FOMC Minutes out at 2p
- S&P futures are up 4 handles from FV; not on a pivot signal, but R3 has been a key resistance point so far in the pre (R3 is 1270)

Futures Hovering Over S4 Pivot For First Time In A Few Weeks

Spain Potential Downgrade

Morning Notes
- Overseas markets are all lower this morning following news that Moody’s may downgrade Spain
- Adding further weakness in the markets is the Tankan Survey results in Japan, which showed that business confidence in the country has fallen for the first time in two years
- JPY weakness has added little support to Nikkei, which closed down just 10bps
- Also, UK unemployment rate came in higher than expected
- Dollar up small
- Gold and oil are down
- NY Empire Manufacturing Survey: 10.57 vs. 3.00; prior was -11.14
- November Core CPI: +0.1% vs. +0.1%
- November CPI m/m: +0.1% vs. +0.2%; prior was +0.2%

- Futures not really reacting to data release
- Other economic items on the calendar for today: Industrial Production and Capacity Utilization at 9:15a ET; NAHB Housing Idx at 10a; Crude Inventories at 10:30a
- S&P futures are down about 4 handles from FV
- Tight pivots in the Spooz today- we are on the S3 buy signal , although that could change quickly given that we are hovering right above S4 and we had been on the S4 sell signal earlier in the pre

Will We Close The Week In The Green Or Are We Doomed For A Reversal Pullback?


Morning Notes

-       Strength this morning clearly in China as Moody’s puts China on review for a potential rating upgrade

-       Shanghai reopened in the o/n after being closed this week for a national holiday

-       Japanese yen still showing strength; Nikkei down about 1%

-       In Japan, a $61B stimulus pkg was approved

-       European mkts down small, fairly muted action- financials are weak

-       Gold, crude down small as well

-       In U.S. corporate news, AA reported earnings (marking the unofficial start of a new earnings season)- beat expectations

-       S&P futures down about 2 handles from FV

-       Mkt action muted ahead of today’s BLS, expecting volatility upon release of data

-       USD up, Euro down, Treasuries up

-       September Jobs Report: Private Payrolls: +64K vs. +75K; prior revised up to +93K from +67K

-       Nonfarm Payrolls: -95K vs. -5K; prior revised down to -57K from -54K

-       Manufacturing Payrolls: -6K vs. +2K

-       Unemployment Rate: 9.6% vs. 9.7%

-       Futures initially rush lower, now recovering

-       Dollar sold off after data release

-       As futures are now pushing higher into the green, will we see a nice up day to end the weak or are we in for a reversal pullback off the open?

Market Waiting For A Sense Of Direction


Morning Notes

-       Quiet overnight session, overseas markets are flat

-       Positive jobs report out of Australia, although unemployment rate remained unch’d at 5.1%, causing AUD to rally to new highs

-       Japanese yen trading up

-       UK Home Prices fell significantly (by 3.6%), causing GBP to weaken

-       Gold continues to climb

-       Dollar down, still weak

-       ECB left interest rate unch’d (1.0%), which was expected

-       Alcoa (AA) kicks off earnings season tonight after the close

-       Same store sales will trickle in this morning

-       Tech sector should be focus in today’s trading session after getting killed yesterday

-       Main item on economic calendar this AM is Initial Jobless Claims at 8:30a EST, should give the markets some sense of direction since everything is trading pretty much flat as of now

Premarket Strength, Sign of Strong Day in the Market Ahead?


Morning Notes

-       Overnight trading skewed to the downside

-       Japan PMI came in weak, falling for the first time since June 2009

-       Other data from Japan also came in weak including Industrial Production, Retail Sales, Retail trade figures

-       Yen still strong

-       All this pushed Nikkei down ~2%

-       However, Shanghai showed decent strength, up ~1.7%, with strength attributed to China’s govt loosening measures to tighten real estate mkt

-       European mkts down small

-       In Ireland, AIB bail out would be as much as 34.3B EUR (at worst) and AIB needs to raise capital

-       Spain downgraded by Moody’s this AM (was somewhat expected): euro sold off on news, but has since recovered

-       German unemployment rate came in in line for month of September, perceived well by the street

-       Initial Jobless Claims: 453K vs. 460K; prior revised up to 469K from 465K

-       Continuing Claims: 4.457M vs. 4.470M

-       Futures pushing higher off data release

-       Q2 GDP: 1.7%, up from 1.6%

-       Core PCE q/q: 1.0%, down from 1.1%

-       Premarket strength may be a good sign of strong day in the market ahead

Looks Like Economists Were Overly Pessimistic


Morning Notes

-       Overnight Recap:

-       Very high correlation b/w Japanese yen and Nikkei persists

-       There was an abrupt sell off in the yen, perhaps on rumors that another currency intervention in the works; however, no comment from BOJ  so yen retraced the move

-       German IFO was main economic item on overseas agenda and came in better than expected (3 yr high), lifting European mkts (but they are still down small)

-       Also, German import prices rose 0.2%

-       Austria reported it would increase GDP forecast

-       Gold still trading at highs

-       S&P futures are up 7 handles from FV

-       Dollar still weak

-       August Durable Goods Ex Transportation: +2.0% vs. +1.0%; prior revised up to -2.8% from -3.8%

-       August Durable Goods: -1.3% vs. -1.0%; prior revised up to +0.7% vs. +0.3%

-       Futures rally, now up 13 handles from FV; boosting European markets as well

2:15p Will Be the Real Start of Today


Morning Notes

-       Mkts quiet ahead of today’s Fed Rate Decision at 2:15p EST

-       Expecting mkts to stay muted up until Fed announces the rate decision

-       Asian mkts were mixed o/n

-       Nikkei down small as yen climbed slightly higher

-       European mkts up small, less than 1%

-       Bond auction results in Greece, Spain, Ireland were net positive

-       S&P futures down about 1.5 handles from FV

-       August Housing Starts: 598K vs. 550K

-       Housing Starts m/m: 10.5%

-       August Building Permits: 569K vs. 560K

-       Building Permits m/m: 1.8%

-       Futures are higher upon housing data release

-       And now, back to muted trading