The FTSE is currently indicating a slightly higher opening, as traders are trying to understand the reason behind the no action move of the BOE. With high inflation and slowing GDP the UK economy is poised to enter into a period of stagflation, which would be disastrous to the FTSE and the GBP/USD.
A strike by Brazilian oil workers pushed oil prices higher by 4 percent. Oil also rose after Iran test-fired more missiles in the Persian Gulf and a Nigerian militant group said it will end a cease-fire this week. We believe that oil will finish the week above the 140 per barrel level. Gold made a break towards the 950 dollars per ounce level, but yet again got rejected before the precious metal was met with profit taking. Another crack at 950 is in the cards.
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Thursday, July 10, 2008
Wednesday, July 9, 2008
BetOnMarkets.com Morning Update - 10/07/08
The FTSE is currently indicating a sharply lower opening. Traders are hedging their bets ahead of the Bank of England's interest rate decision. Judging by the futures market, traders are counting on a rate hike. It looks like the BOE is between a rock and a hard place, having to choose between controlling inflation or saving the UK economy from entering a recession it seems like traders are convinced that the BOE will chose to control the spiraling inflation this morning.
Oil pulled out of a steep two-day slide yesterday after US data showed a big drawdown in crude inventories and OPEC-member Iran conducted missile tests that raised risk premium in the price of oil. We believe that oil is heading back to its 140+ levels.
BetOnMarkets
Oil pulled out of a steep two-day slide yesterday after US data showed a big drawdown in crude inventories and OPEC-member Iran conducted missile tests that raised risk premium in the price of oil. We believe that oil is heading back to its 140+ levels.
BetOnMarkets
BetOnMarkets Morning Update - 09/07/08
The FTSE is currently indicating a sharply higher open, as traders are anticipating better then expected trade balance figures due out at 8.30am GMT. While there have been a lot of rumours that the UK economy is teetering on the brink of a recessions, a healthy trade balance will dispel those rumours, and help the FTSE after yesterdays massive selloff. Most traders are preparing for the BOE interest rate decision on Thursday morning. We believe that there will be no rate hike, and there is actually a slight possibility for a rate cut after the abysmal manufacturing and production numbers early this week.
Oil has been on a victim of profit taking and a strong US dollar, falling more then 9 dollars since hitting 145.85 per barrel on July 3rd. While this is most welcomed by everyone other then the oil producers, the cheap prices are short lived, as consumers and corporations will take advantage to buy oil at these low prices for future use. Gold has been a lower for the last 4 days, and it does not look like it will change today. Lower oil prices and a strong dollar has traders selling the precious metal, which is used to hedge against inflation and weakness in the US dollar.
BetOnMarkets
Oil has been on a victim of profit taking and a strong US dollar, falling more then 9 dollars since hitting 145.85 per barrel on July 3rd. While this is most welcomed by everyone other then the oil producers, the cheap prices are short lived, as consumers and corporations will take advantage to buy oil at these low prices for future use. Gold has been a lower for the last 4 days, and it does not look like it will change today. Lower oil prices and a strong dollar has traders selling the precious metal, which is used to hedge against inflation and weakness in the US dollar.
BetOnMarkets
Monday, July 7, 2008
BetOnMarkets.com Afternoon Update - 07/07/08
The FTSE is currently indicating a higher open, as traders are waiting for the release of the UK Industrial and Manufacturing Production numbers. While traders are predicting no change, we believe that this is very optimistic. We believe that both the industrial and manufacturing production numbers actually fell in June. A slow down in the UK production will force the BOE think twice before they raise interest rates again at the next meeting.
Gold was on the weak end of things as the US dollar benefited from better then expected employment numbers. With no major news until later today, we expect gold to continue its retreat, and US dollar to strengthen vs. the major currency pairs. Oil is also weaker this morning, mainly due to the fact that the contracts are priced in US dollars.
[b]
Betonmarkets[/b]
Gold was on the weak end of things as the US dollar benefited from better then expected employment numbers. With no major news until later today, we expect gold to continue its retreat, and US dollar to strengthen vs. the major currency pairs. Oil is also weaker this morning, mainly due to the fact that the contracts are priced in US dollars.
[b]
Betonmarkets[/b]
Sunday, July 6, 2008
BetOnMarkets Weekly Briefing
Contents This Week:
Economic calendar for week 7th - 11th July 2008.
Commentary: The week ahead.
Economic Calendar for week 7th - 11th July 2008
PLEASE NOTE - All times GMT not BST. BST is +1 Hr.
Monday July 7th:
EU - 08:30 - Sentix Investor Confidence.
UK - 08:30 - Industrial Production M/M.
UK - 08:30 - Manufacturing Production M/M.
GE - 10:00 - Industrial Production M/M.
UK - 23:01 - NIESR GDP Estimate.
Tuesday July 8th:
UK - 08:30 - DCLG HPI Y/Y.
US - 14:00 - Pending Home Sales M/M.
US - 14:00 - Wholesale Inventories M/M.
US - 19:00 - Consumer Credit M/M.
UK - 23:01 - Consumer Confidence Index.
Wednesday July 9th:
GE - 06:00 - Trade Balance.
FR - 06:45 - Trade Balance.
UK - 08:30 - Trade Balance.
UK - 09:30 - BRC Shop Price Index Y/Y.
US - 14:35 - Crude Oil Inventories.
Thursday July 10th:
FR - 06:45 - Industrial Production M/M.
EU - 09:00 - ECB Bulletin.
UK - Tentative - MPC Rate Statement.
UK - 11:00 - Official Bank Rate.
US - 12:30 - Unemployment Claims,
EU - 14:35 - Natural Gas Storage.
Friday July 11th:
US - 12:30 - Trade Balance.
US - 12:30 - Import Price Index M/M.
GE - 13:55 - Prelim Michigan Sentiment.
EU - Europe wide
FR - France
UK - United Kingdom
US - United States
GE - Germany
The week ahead.
The half year report card for global stock markets was not one to be proud of. The first half of 2008 was the worst first half to a year for the Dow Jones Industrial Average since 1970, when the index was down 14.60%. The 14.44% decline of 2008 is actually the tenth worse performance since 1900. July hasnt exactly started off with a bang and US traders may be thankful for the long weekend last week. The S&P 500 closed the week down 1.19%, registering its lowest daily close for almost two years. June was especially hard for US markets with a drop of 8.55% for the S&P 500, and a 10.19% collapse on the Dow, making up most of the years losses to date.
The culprits are not too hard to find. The first half performance of the US financial sector was -30%, while the Energy sector managed to find a rise of 8.12%. If you were asked to list the top dangers for the global economy, you would be hard pressed to find any factors that are not already playing themselves out. Firstly we have oil prices that seem to reach new record highs with each passing week. $150 per barrel is looming ever closer. This price action is linked to the second danger, further conflict in the Middle East. Last week, a former Israeli air force commander was quoted as saying that Israel was ready to attack Iran if diplomacy fails. The Iranian oil minister has responded by saying that Iran is ready to defend itself, and that an attack on Iranian nuclear facilities would be the start of war.
Oil fuelled inflation is still causing central bankers headaches, with Citi Group today predicting that UK inflation jumped to 4.6% in June. Last week, the ECB went to great lengths to stress that the recent rate hike didnt automatically precede a series of hikes. Nevertheless, Trichets firm stance on fighting inflation has caused some disagreements between the ECB and the Federal Reserve in the US. The final horseman of the apocalypse could be when the global economy finally yields to the pressures of inflation and the aftermath of the credit crunch. There are increasing signs that the worlds largest economy is slowing. Thursdays US payroll figures showed a 20% increase in unemployment year on year. Also Non Farm Payrolls shrank for the 6th consecutive month. With UK house prices going the same way as the US market, the bricks and mortar ATM is no longer paying out, and UK households are already at record levels of indebtedness. Shocking figures from Marks & Spencer last week was testament to this.
The week ahead is a quieter affair with fewer top tier announcements than the week just gone. That said, there are still some potential market moving datasets due. UK industrial and manufacturing production figures are released on Monday morning. The recent Purchasing Managers Index monthly survey of UK manufacturing was described as truly dreadful, with indications that this sector at least may be heading for a recession. On the same day, we provisionally have the UK Halifax Price Index delayed from last week. On the same note, US pending home sales are released on Tuesday. Bad news is expected for both, the only question being how bad the news actually is.
The weeks top ticket trading is the MPC interest statement on Thursday. The Bank of England is still stuck between a rock and a hard place, with record oil prices driving inflation, and slowing consumer spending hurting the economy. A no change verdict is widely expected to be the more likely course of action.
With next week being relatively lighter on the economic news front, it may be a good time for a trade that looks to profit from low volatility. A barrier range trade wins if neither of two levels are hit within the specific time period. A barrier range trade predicting that the FTSE 100 will not touch 5016 or 5875 in the next 16 days could return 10%.
BetOnMarkets
Economic calendar for week 7th - 11th July 2008.
Commentary: The week ahead.
Economic Calendar for week 7th - 11th July 2008
PLEASE NOTE - All times GMT not BST. BST is +1 Hr.
Monday July 7th:
EU - 08:30 - Sentix Investor Confidence.
UK - 08:30 - Industrial Production M/M.
UK - 08:30 - Manufacturing Production M/M.
GE - 10:00 - Industrial Production M/M.
UK - 23:01 - NIESR GDP Estimate.
Tuesday July 8th:
UK - 08:30 - DCLG HPI Y/Y.
US - 14:00 - Pending Home Sales M/M.
US - 14:00 - Wholesale Inventories M/M.
US - 19:00 - Consumer Credit M/M.
UK - 23:01 - Consumer Confidence Index.
Wednesday July 9th:
GE - 06:00 - Trade Balance.
FR - 06:45 - Trade Balance.
UK - 08:30 - Trade Balance.
UK - 09:30 - BRC Shop Price Index Y/Y.
US - 14:35 - Crude Oil Inventories.
Thursday July 10th:
FR - 06:45 - Industrial Production M/M.
EU - 09:00 - ECB Bulletin.
UK - Tentative - MPC Rate Statement.
UK - 11:00 - Official Bank Rate.
US - 12:30 - Unemployment Claims,
EU - 14:35 - Natural Gas Storage.
Friday July 11th:
US - 12:30 - Trade Balance.
US - 12:30 - Import Price Index M/M.
GE - 13:55 - Prelim Michigan Sentiment.
EU - Europe wide
FR - France
UK - United Kingdom
US - United States
GE - Germany
The week ahead.
The half year report card for global stock markets was not one to be proud of. The first half of 2008 was the worst first half to a year for the Dow Jones Industrial Average since 1970, when the index was down 14.60%. The 14.44% decline of 2008 is actually the tenth worse performance since 1900. July hasnt exactly started off with a bang and US traders may be thankful for the long weekend last week. The S&P 500 closed the week down 1.19%, registering its lowest daily close for almost two years. June was especially hard for US markets with a drop of 8.55% for the S&P 500, and a 10.19% collapse on the Dow, making up most of the years losses to date.
The culprits are not too hard to find. The first half performance of the US financial sector was -30%, while the Energy sector managed to find a rise of 8.12%. If you were asked to list the top dangers for the global economy, you would be hard pressed to find any factors that are not already playing themselves out. Firstly we have oil prices that seem to reach new record highs with each passing week. $150 per barrel is looming ever closer. This price action is linked to the second danger, further conflict in the Middle East. Last week, a former Israeli air force commander was quoted as saying that Israel was ready to attack Iran if diplomacy fails. The Iranian oil minister has responded by saying that Iran is ready to defend itself, and that an attack on Iranian nuclear facilities would be the start of war.
Oil fuelled inflation is still causing central bankers headaches, with Citi Group today predicting that UK inflation jumped to 4.6% in June. Last week, the ECB went to great lengths to stress that the recent rate hike didnt automatically precede a series of hikes. Nevertheless, Trichets firm stance on fighting inflation has caused some disagreements between the ECB and the Federal Reserve in the US. The final horseman of the apocalypse could be when the global economy finally yields to the pressures of inflation and the aftermath of the credit crunch. There are increasing signs that the worlds largest economy is slowing. Thursdays US payroll figures showed a 20% increase in unemployment year on year. Also Non Farm Payrolls shrank for the 6th consecutive month. With UK house prices going the same way as the US market, the bricks and mortar ATM is no longer paying out, and UK households are already at record levels of indebtedness. Shocking figures from Marks & Spencer last week was testament to this.
The week ahead is a quieter affair with fewer top tier announcements than the week just gone. That said, there are still some potential market moving datasets due. UK industrial and manufacturing production figures are released on Monday morning. The recent Purchasing Managers Index monthly survey of UK manufacturing was described as truly dreadful, with indications that this sector at least may be heading for a recession. On the same day, we provisionally have the UK Halifax Price Index delayed from last week. On the same note, US pending home sales are released on Tuesday. Bad news is expected for both, the only question being how bad the news actually is.
The weeks top ticket trading is the MPC interest statement on Thursday. The Bank of England is still stuck between a rock and a hard place, with record oil prices driving inflation, and slowing consumer spending hurting the economy. A no change verdict is widely expected to be the more likely course of action.
With next week being relatively lighter on the economic news front, it may be a good time for a trade that looks to profit from low volatility. A barrier range trade wins if neither of two levels are hit within the specific time period. A barrier range trade predicting that the FTSE 100 will not touch 5016 or 5875 in the next 16 days could return 10%.
BetOnMarkets
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