Tag Archives: oil prices

USD Off To Slower Start In August

Here’s today’s ‘Just A Minute’ bringing you a 60 second summary of what’s happening in the financial markets:

WHAT WE’RE WATCHING TODAY

Dollar Gets Off To Slower Start In August

The U.S. dollar got off to a cooler start today after experiencing its biggest one-day fall in almost a month after a series of economic data led markets to push back expectations for the start of the Federal Reserve’s rate-tightening cycle. U.S. jobs growth slowed in July, the unemployment rate unexpectedly edged up and inflation was restrained, a mix of figures that may indicate the Fed will keep interest rates low for longer. The dollar index was last at 81.321 .DXY having retreated from a 10 1/2 month peak of 81.573. It had fallen 0.2 percent on Friday, a modest decline but still the biggest one-day fall in over three weeks. The index had rallied more than 2 percent in July as improving U.S. data convinced markets that an interest rate rise could be less than 12 months away. That allowed the euro to push back above $1.3400 EUR and off an eight month trough of $1.3366 plumbed last week. Against the yen, the dollar recoiled to 102.56 JPY, having stretched to a near four-month high of 103.15.

S&P 500 Sees Biggest Weekly Decline Since 2012

Data showing U.S. job growth eased off in July and the unemployment rate unexpectedly rose suggests that the Federal Reserve may keep interest rates low for a while. The jobs growth, which came in below economists’ forecasts, relieved some investors worried about how soon the Fed could increase interest rates after data on Thursday showed U.S. labour costs recorded their biggest gain in more than 5 1/2 years in the second quarter. Seven of the 10 S&P 500 sectors ended lower with S&P financials among sectors with the biggest losses. The Dow Jones industrial average fell 69.93 points to 16,493.37, the S&P 500 lost 5.52 points to 1,925.15 and the Nasdaq Composite dropped 17.13 points to 4,352.64. For the week, the S&P 500 fell 2.7 percent, its biggest weekly percentage loss since the week ending June 1, 2012. The Dow ended down 2.8 percent for the week, while the Nasdaq fell 2.2 percent. The Dow’s losses pulled it deeper into negative territory and is consequently down 0.5 percent for the year to date.

WTI Trades Near Six-Month Low Before Economic Data

West Texas Intermediate crude traded near the lowest price in six months before data that will signal the strength of the economy in the U.S., the world’s biggest oil consumer. Brent was steady in London. Futures were little changed in New York after capping the biggest weekly decline in seven months on Aug. 1. The Markit Economics purchasing managers index for U.S. services is due tomorrow, while factory order data is also scheduled this week. WTI for September delivery was at $98 a barrel in electronic trading on the New York Mercantile Exchange, up 12 cents. The contract slid 0.3 percent to $97.88 on Aug. 1, the lowest close since Feb. 6. The volume of all futures traded was about 1.3 percent above the 100-day average. Prices are down 0.5 percent this year. Brent for September settlement rose 21 cents to $105.05 a barrel on the London-based ICE Futures Europe exchange. The European benchmark crude was at a premium of $7.08 to WTI. It closed at $6.96 on Aug. 1.

That sums up today’s highlights! We hope you have a profitable day on the markets.

Investors Look To U.S. On Europe Concerns

Here’s today’s ‘Just A Minute’ bringing you a 60 second summary of what’s happening in the financial markets:

Main Trading Event Of The Day: U.S. Pending Home Sales @ 14.00 GMT

WHAT WE’RE WATCHING TODAY

Investors Look To U.S. On Europe Concerns

As the prospect of tougher sanctions against Russia impacts on confidence in Europe, investors will be looking to the United States and China to underpin the global economy. Wednesday’s U.S. GDP reading and jobs data on Friday will help markets assess the strength of the economy’s rebound and the speed of the Federal Reserve’s return to more conventional monetary policy. In Europe, the downing of a Malaysia Airlines airliner over the Ukraine has left countries such as Germany with little choice but to change their long-passive stance and impose tougher sanctions on Moscow. European Union ambassadors are expected to meet early this week to finalise sanctions that could include closing EU capital markets to state-owned Russian banks, placing an embargo on arms sales and restricting supply of energy technology. Globally, such sanctions would hurt Europe hardest, where Russia does most trade, compounding economic problems for Russia and throughout the region. The International Monetary Fund has already flagged the ‘chilling effect’ on investment in Russia of sanctions as it pared back its forecast for global economic growth last week. Confidence amongst businesses in Germany, which accounts for more than one quarter of all exports across the European Union, has dipped further since the plane crash. The crisis comes at a delicate moment for the 18 countries using the euro, where a fledgling recovery is losing pace. Investors will get a snapshot of the bloc’s inflation rate, which has sunk well below the European Central Bank’s target on Thursday.

Dollar Index Holds Close To Six Month Peak

The U.S. dollar hovered near six month highs against a basket of major currencies on Monday, holding onto solid gains made last week as investors turned bearish on the euro. This was ahead of key U.S. economic data later this week and a U.S. Federal Reserve meeting ending on Wednesday which market-watchers believe is likely to culminate in the same dovish message from Chair Janet Yellen.

The Commerce Department is expected to report on Wednesday that the economy grew at a 3.2 percent annual pace in the second quarter, after it shrank 2.9 percent in the previous quarter. On Friday, the Labor Department’s non-farm payrolls are expected to show a rise of 231,000 in July after they increased 288,000 in June. The jobless rate is expected to hold steady at 6.1 percent. Yellen said this month that the Fed could raise rates sooner than initially expected if labour markets continued to improve. Still, most economists expect the U.S. central bank to start raising interest rates in the second half of 2015. The dollar index was steady at 81.045, after it peaked at 81.084 on Friday, a high not seen since early February. So far this month, it has rallied around 1.6 percent, on track for its best monthly gain since January. Against its Japanese counterpart, the dollar was steady at 101.81 yen.

WTI Crude Declines In Advance Of U.S. Data

West Texas Intermediate crude fell for the fourth time in five days amid speculation that forthcoming economic data may signal a slowdown in growth in the U.S. Brent also dropped in London. Futures declined as much as 0.6 percent in New York. A preliminary index of U.S. service industries is forecast at 59.8 for July, the lowest level in three months. The Federal Reserve is scheduled to review monetary policy at a two-day meeting starting tomorrow. WTI for September delivery fell as much as 59 cents to $101.50 a barrel on the New York Mercantile Exchange to $101.59. The contract gained 2 cents to $102.09 on July 25. The volume of all futures traded was about 18 percent below the 100-day average. Prices are down 3.6 percent in July, the most in eight months. Brent for September settlement lost as much as 60 cents, or 0.5 percent, to $107.79 a barrel on the London-based ICE Futures Europe exchange. The European benchmark crude traded at a premium of $6.29 to WTI. The spread closed at $6.30 on July 25, the widest since July 7.

That sums up today’s highlights! We hope you have a profitable day on the markets.

Brent Falls As Libya Restarts Oilfield

Here’s today’s ‘Just A Minute’ bringing you a 60 second summary of what’s happening in the financial markets:

Main Trading Event Of The Day: U.S. FOMC Meeting Minutes @ 18.00 & EUR Mario Draghi Speaks @ 18.30 GMT

WHAT WE’RE WATCHING TODAY

Brent Falls As Libya Restarts Oilfield

Brent crude fell below $109 a barrel today as Libya restarted an oilfield, leaving it on track to fall for an eighth session. This would make it its longest losing streak in over four years. Easing worries over possible disruptions to supply from the conflict in Iraq also dragged on prices. August Brent crude declined 12 cents to $108.82 a barrel, down nearly 6 percent from a nine-month high reached in June. U.S. crude for August delivery was up 3 cents at $103.43 a barrel, after Tuesday’s settlement marked its longest losing run since December 2009. Meanwhile, Iraq’s new parliament has brought forward the date of its next session to July 13, in the face of a militant insurgency that has swept large parts of the country. Investors are eyeing more data on oil inventories in the United States and on China’s trade later this week to take the pulse on oil demand at the world’s two largest consumers. Lingering weakness in the Chinese economy could prompt Beijing to launch further stimulus measures to shore up growth which could lift its fuel demand. U.S. crude inventories fell by 1.7 million barrels in the week to July 4, compared with analyst expectations for a decrease of 2.2 million barrels.

Gold Inches Up On Fund Inflows

Gold inched up as the world’s top bullion fund saw a second straight day of inflows, even as markets awaited the minutes of the Federal Reserve’s June policy meeting to gauge the U.S. central bank’s outlook for the economy and interest rates. Spot gold edged up 0.2 percent to $1,321.15 an ounce. SPDR Gold Trust confirmed its holdings rose 2.09 tonnes to 800.28 tons on Tuesday, after gaining 1.8 tons on Monday. Demand for gold was boosted by violence in the Middle East and Ukraine. Bullion investors are also awaiting the minutes of the Fed policy meeting later today for clues on the timing of a rate hike. A strong U.S. jobs report last week fuelled fears of an earlier than expected rate hike in the world’s largest economy. A hike would encourage investors to withdraw money from non-interest-bearing assets such as gold.

Australia Consumer Confidence Improves

A measure of Australian consumer sentiment improved edged higher in July as worries about family finances eased. The index of consumer sentiment rose a seasonally adjusted 1.9 percent in July, from June when it had inched up only 0.2 percent. The index still has not fully recovered from May’s 6.8 percent dive which followed a budget of welfare reforms, cutbacks and increased charges for services. The index reading of 94.9 for July was down 7.1 percent on the same month last year and means pessimists still exceed optimists. The largest improvement in July came in the survey’s measure on the outlook for family finances over the next 12 months, which jumped 12.3 percent though from very low levels. The index of family finances compared to a year ago rose 1.9 percent and that for economic conditions over the next 12 months increased by 3.9 percent. Consumers remained cautious on the longer-term outlook, however, with the index of economic conditions over the next five years dropping 3.8 percent.

That sums up today’s highlights! Remember to keep posted on our social media pages for all the latest trading updates for the day. We hope you have a profitable day on the markets.

Yellen Prepares To Address On Financial Stability

Here’s today’s ‘Just A Minute’ bringing you a 60 second summary of what’s happening in the financial markets:

Main Trading Event Of The Day: U.S. Fed Chair Yellen Speaks @ 15.00 GMT

WHAT WE’RE WATCHING TODAY

Yellen Prepares To Address On Financial Stability

Federal Reserve Chairwoman Janet Yellen is preparing to discuss financial stability later today as market-watchers worry that the Fed’s exit from its easy monetary policy stance will may upset the markets. Yellen speaks today at the International Monetary Fund’s first annual central banking lecture and will then joins discussions with IMF current managing director Christine Lagarde. Stock markets have been range-bound with low volatility. Further concern has been targeted toward parts of the bond market, particularly on the corporate side. In her recent press conference, Yellen said that financial stability concerns are always on the table for policy makers but are not impacting on monetary policy in any major way at the moment. She stressed several times that the outlook was uncertain as some observers noted that Yellen’s focus on uncertainty was a message to buoyant financial markets that a little caution might be welcome. Fed officials are aware that ignoring risks to financial stability has its perils but focusing too much on it does as well. Fed Chair Yellen Speaks Today @ 13.00 GMT.

WTI Trades Near Three-Week Low

West Texas Intermediate traded close to the lowest price in three weeks before stockpile data that may signal the strength of fuel demand in the U.S. Futures were little changed in New York after declining 3 cents yesterday. U.S. crude inventories likely fell last week while gasoline supplies rose before data from the Energy Information Administration today. Fighting in Iraq has not yet spread to the south, home to more than three-quarters of its oil production so the markets are closely monitoring the political situation. WTI for August delivery was at $105.35 a barrel in electronic trading on the New York Mercantile Exchange, up 1 cent, at 2:52 p.m. Sydney time. The contract slid to $105.34 yesterday, the lowest close since June 11. The volume of all futures traded was about 54 percent below the 100-day average. Prices have gained 7 percent this year. Brent was steady in London and was 3 cents higher at $112.32 a barrel on the London-based ICE Futures Europe exchange. The European benchmark crude traded at a premium of $6.94 to WTI, compared with $6.95 yesterday.

Aussie Dollar On A Roll, But Will It Last?

The Australian dollar soared to eight-month highs this week, seemingly on a roll but questions are being raised as to whether it will last. The AUD has been on an upward trend since late January and has gained approx 6.5 percent against the U.S. dollar so far this year, making it the best performing major currency after the New Zealand dollar. Its strong performance, driven by a rise in risk appetite and firm demand for Australian bonds, has led some currency analysts to believe that parity with the U.S. dollar could be achieved by year-end. Yet others believe that its recent performance should not be taken as a sign that a move to the one-to-one level with the U.S. dollar is likely to come sooner rather than later. The Aussie dollar rose as high as $0.9504 on Tuesday after the Reserve Bank of Australia left interest rates unchanged and delivered as statement that was viewed as less dovish than anticipated. Data on Wednesday showed Australia’s May trade deficit at A$1.9 billion, compared with analyst expectations for a deficit of A$120 million. Recent data also shows consumer confidence in Australia has taken a hit from the May budget. The concern, according to economists, is that the fall in confidence will spill over into weaker retail sales and makes the economic outlook uncertain.

That sums up today’s highlights! Please keep checking into our Facebook, Twitter, Google+ and LinkedIn pages for all the latest daily trading news. We hope you have a profitable day on the markets.

U.S. Growth Evident But Consumers & Businesses Still Penny Pinching

Here’s today’s ‘Just A Minute’ bringing you a 60 second summary of what’s happening in the financial markets:

Main Trading Event Of The Day: U.S. Existing Home Sales @ 14.00 GMT

WHAT WE’RE WATCHING TODAY

U.S. Growth Evident But Consumers & Businesses Still Penny Pinching

The American job market is on the way up with an increase in hiring and U.S. manufacturers are growing faster. The economy finally seems to have emerged from its winter slow down and is now on an upbeat path….However, Americans are spending less than they used to, a big hindrance for an economy that relies heavily on consumers to generate growth. The slower pace of consumer spending can be traced to a prolonged period during which businesses have invested below their historical norm. Markets will get another look this week at whether the trends in consumer spending and business investment took a turn for the better in May but economists don’t expect a huge improvement. An update on new homes sales is due and the government is likely to report that the economy shrank even more sharply in the first quarter than previously estimated. Although an improving economy is visible, it still has a long way to go before a five-year-old recovery can be considered in good shape. These days, it’s not as easy for prospective buyers get a home loan as financial companies don’t want to make the same mistake they made before the recession by accepting customers who pose any credit risk. The third and final revision to first-quarter gross domestic product probably won’t bring any cheer the markets either as the government is expected to report that U.S. growth contracted by 2% instead of 1% as previously reported which would be the biggest decline since the tail end of the 2007-2009 recession.

The case for faster U.S. growth in the second quarter of 2014 and beyond rests on the hope that businesses and consumers will spend more although so far this year, companies haven’t toed the line. Business investment as measured by a category known as core capital goods fell in April and it’s only rising at a modest 3.5% rate over the past three months. Durable goods orders for May, released on Wednesday, is unlikely to show a marked shift in business investment either. As for consumers, they did more shopping in the early spring and spending is likely to rise in May, but spending is running at just two-thirds the typical rate this far into an economic recovery. Part of what’s holding them back is a paltry increase in wages even though more companies are hiring and job opening are at a post-recession high. After inflation is taken into account, wages are basically flat over the past year. Yet while Fed officials expect unemployment to fall even faster than they predicted just a few months ago, they haven’t changed their growth forecasts for the next two years. As market watchers know, faster U.S. growth depends on willingness to spend and invest…

Oil Gains On Increasing Iraq Violence

West Texas Intermediate rose for the third day and Brent gained as militants in Iraq seized more territory and President Obama warned that the crisis may spill over into other countries. August futures climbed as much as 0.6 percent in New York. A Chinese manufacturing gauge rose to a seven-month high in June, indicating that the economy of the world’s second-biggest oil user is picking up. WTI for August delivery rose by 62 cents to $107.45 a barrel. The July contract expired at $107.26 on June 20. The volume of all futures traded was about 1 percent above the 100-day average. Front-month prices have increased 8.9 percent this year. Brent for August settlement gained as much as 47 cents, or 0.4 percent, to $115.28 a barrel on the London-based ICE Futures Europe exchange. The European benchmark crude traded at a premium of $7.96 to WTI, from $7.98 on June 20.

Apple iWatch Due To Begin Production

Taiwan’s Quanta Computer will start mass production of Apple’s first smartwatch in July, as the company attempts to prove it can still compete against rival Samsung Electronics. The watch will be Apple’s first foray into a niche product category that many remain skeptical about, especially as to whether it can drive profits amid cooling growth in tech gadgets. Apple is expected to ship 50 million units within the first year of the product’s release. Mass production will start in July and the commercial launch will come as early as October. The company is accountable for at least 70 percent of final assembly. LG Display Co is said to be the exclusive supplier of the screen for the gadget’s initial batch of production. The iWatch also contains a sensor that monitors the user’s pulse for which Singapore-based imaging and sensor maker Heptagon is on the supplier list for the feature.

That sums up today’s highlights! Keep checking in for all the latest news on the day’s trading events via Facebook, Twitter, Google+ & LinkedIn. We hope you have a profitable day on the markets.

Oil Prices Increase As Iraq Tensions Brew

Here’s today’s ‘Just A Minute’ bringing you a 60 second summary of what’s happening in the financial markets:

Main Trading Event Of The Day: U.S. Unemployment Claims @ 12.30 GMT

WHAT WE’RE WATCHING TODAY

Oil Prices Increase As Iraq Tensions Brew

Surging U.S. oil production was expected to drive oil prices lower this year, but a number of geopolitical events, in particular, a Sunni militant uprising in Iraq could now drive already high prices even higher and keep them there. Citigroup raised its price forecast for Brent crude several weeks ago to an average $109 per barrel this year, and $105 for next year, based on a cluster of geopolitical events. Crude prices have been trading near 52-week highs. Brent was up slightly Wednesday, hovering at $110 per barrel. West Texas Intermediate has been moving higher with it, closing at $104.40 per barrel on Wednesday. Outages in Libya, the ongoing boycott against Iranian crude and security concerns in Nigeria are all adding to worry that global oil supplies could become tighter. Russia’s foray into Ukraine also has added slightly to the price premium since it is a major source of oil to Europe. Another factor driving prices is China’s growing demand for oil. But at the same time, U.S. oil production continues to surge. The latest U.S. government data, released Wednesday, shows domestic oil production rose to 8.46 million barrels a day last week, up from 7.2 million barrels at the same time last year and 8.38 million barrels just a week earlier. So far, with OPEC pumping 30 million barrels a day and the U.S. producing more oil now than it imports, prices have risen but not spiked on fears about Iraq. However, this could be set to change.

RBNZ Signals Further Tightening After Third Rate Rise

New Zealand’s central bank raised interest rates for the third time this year and signaled more tightening to come. The dollar surged jumping from 1.2 percent to 86.47 U.S. cents in Tokyo and headed for its biggest daily gain in four months. The kiwi rallied at least 1 percent versus all of its 31 major counterparts as Reserve Bank of New Zealand Governor Graeme Wheeler said it was important to contain inflation expectations. New Zealand’s central bank boosted its official cash rate by a quarter-percentage point to 3.25 percent. Wheeler is the first central banker from a developed nation to raise official interest rates this year, fueling gains in the nation’s currency. Wheeler added that “the bank does not believe the exchange rate is sustainable at current levels. The exchange rate has not yet adjusted to weakening commodity prices, but is expected to do so.”

Gold Holds Near Two-Week High

Gold held near the highest level in two weeks as a rally in equities faltered, boosting demand for alternative investments. Gold for immediate delivery was at $1,261.12 an ounce yesterday. The metal yesterday climbed to $1,265.32, the highest level since May 28, as the Dow Jones Industrial Average halted a five-day advance after the World Bank cut its forecast for global growth. While gold has seen a bit of bounce, the outlook for prices remains negative as U.S. economic data continues to improve, supporting strength in the stock markets and tapering. Bullion sank 28 percent in 2013 to end a 12-year bull run on speculation the Fed will trim asset purchases used to fuel growth as the economy recovers.

That sums up today’s highlights! Don’t forget to keep updated on all today’s trading events via Facebook, Twitter, Google+ and LinkedIn. We hope you have a profitable day on the markets.

ECB Set To Cut Rates Driving Banks Into Lending

Here’s today’s ‘Just A Minute’ bringing you a 60 second summary of what’s happening in the financial markets:

WHAT WE’RE WATCHING TODAY

ECB Set To Cut Rates Driving Banks Into Lending

The European Central Bank is set to impose negative interest rates on its overnight depositors, seeking to push banks into lending and to prevent the euro zone falling into deflation as experienced in Japan. At today’s meeting, ECB policymakers are also expected to launch a loan program for banks with strings attached to make sure the money actually gets out into the euro zone economy. Even though the risks are limited of the euro zone entering a spiral of falling prices, slowing growth and consumption, the ECB is increasingly concerned that continuously low inflation and weak bank lending could upset the recovery. The economy grew just 0.2 percent in the first quarter, and euro zone annual inflation unexpectedly slowed to 0.5 percent in May, putting additional pressure on the central bank to step in. A broad stimulus package may be in the making that is likely to consist of a cut in interest rates which would push the deposit rate for the first time into negative territory and the offer of longer-term loans linked to further lending. Large-scale asset purchases remain a distant prospect. Cutting the deposit rate below zero would see the ECB charge banks for parking their excess money at the central bank, a step it hopes will prompt them to lend out the money instead. The euro has fallen about 4 U.S. cents against the dollar since the ECB’s May meeting, hitting $1.3586 last Thursday. Before taking any decision, the Governing Council will look at the June update of its quarterly staff projections. In March, they showed it would take 2-1/2 years for inflation to get near the ECB’s target of below but close to 2 percent. A deteriorating outlook will be seen as triggering action although a move to deploy so-called quantitative easing remains some way off.

Nikkei Touches Two-Month High. Is it Just The Start?

The Nikkei touched a two-month high this week, a sign of lessening concerns about Japan’s economy, according to analysts who remain bullish on Japanese stocks. Stocks powered higher on Thursday, to reach 15,141 soon after open, its highest level since April 3. Last year, plans to boost Japan’s economy through aggressive easing, fiscal stimulus and structural reform saw the Nikkei rise 55 percent, while the yen depreciated 21 percent against the U.S. dollar boosting exporter stocks. However, the Nikkei fell 8.2 percent during the first quarter of 2014 amid concerns about the impact of a consumption tax hike to 8 percent from 5 percent in April. Companies were afraid that Japan’s economy would lurch back into the dangerous deflationary spiral that the last tax hike prompted in the 1990s but the economy has proved resilient, and Japan’s core consumer prices jumped 3.2 per cent in April from a year earlier, the fastest gain since February 1991. Meanwhile, investors have also turned more positive on progress on structural reforms. This week Japan’s corporate tax rate was cut, one of the structural reforms investors were worried might not come to fruition. Japan’s corporate tax rate currently sits at around 35.6 percent, among the highest in industrialised nations. The release this week of a draft of the government’s growth strategy has also powered stocks higher.

WTI Falls for Second Day Amid Record U.S. Supply

West Texas Intermediate fell for a second day as crude stockpiles remained near record-high levels amid declining fuel demand in the U.S., the world’s biggest oil consumer. Futures dropped as much as 0.4 percent in New York. Crude supplies shrank by 3.43 million barrels to 389.5 million last week. They were at 399.4 million through April 25, the most since the Energy Department’s statistical arm started publishing weekly data in 1982. There is still concern that the market is oversupplied. WTI for July delivery declined as much as 45 cents to $102.19 a barrel in electronic trading on the New York Mercantile Exchange and was at $102.34. Brent for July settlement decreased as much as 40 cents, or 0.4 percent, to $108 a barrel on the London-based ICE Futures Europe exchange. The European benchmark crude traded at a premium of $5.98 to WTI.

That sums up today’s highlights! Keep checking in regularly via our social media channels for all the latest trading updates and news. We hope you have a profitable day on the markets.

Is There An End In Sight To The Six-Year Bull Run?

Here’s today’s ‘Just A Minute’ bringing you a 60 second summary of what’s happening in the financial markets:

Main Trading Event Of The Day: U.S. Unemployment Claims @ 12.30 GMT

WHAT WE’RE WATCHING TODAY

Is There An End In Sight To The Six-Year Bull Run?

Are stocks telling us that a bear market is coming? That’s the opinion of some analysts who point out that bear markets ‘start with a whimper or a bang’. When it starts with a bang, the first clue will be a major break in the market that no one can explain. That will eventually be followed by a correction at which point everyone will be aware that something bad has happened. Should this happen, indexes will fall by double digits, investors will panic, and stocks will nosedive. But when a bear market starts with a whimper, it confuses nearly everyone. A meandering, volatile market is frustrating. At first, bulls will be hopeful that the market will keep going up, but eventually, the market tops out and retreats. Typically, a market making new highs is a healthy sign. In a looming bear market, new highs on lower volume is a warning sign. Right now, the strongest case for the bulls is the Fed but in the history of the stock market, no institution has been able to prevent a bear market. What might cause the market to snap is not certain - it could be an economic event, a geopolitical crisis, or a spike in interest rates. If it happens, nearly everyone will realise the market is in trouble at which point everyone will attempt to sell at once. Is that crunch time getting closer? No one knows but some believe a bear market is inevitable sooner rather than later.

The U.S. stock market closed broadly lower yesterday, as investors turned cautious amid a sell-off of small and high-growth companies. The benchmark S&P 500 and Dow Jones Industrial Average retreated from record levels set on Tuesday. The S&P 500 finished 8.92 points, or 0.5% lower at 1,888.53. The Dow Jones Industrial Average broke its five-day winning streak and closed 101.47. points, or 0.6%, lower at 16,613.97. The Nasdaq Composite ended the day down 29.54 points, or 0.7%, at 4,100.63.

Dollar Holds Losses Before Yellen Speaks Today

With Federal Reserve Janet Yellen due to speak later today and expectations that the central bank will maintain stimulatory policies, the U.S. dollar managed to hold losses against the majority of its 16 major peers after touching its lowest in almost a week versus the yen yesterday. Yellen told Congress last week the economy needs support. A report showed Japan’s gross domestic product expanded at the fastest pace in 2 1/2 years, damping bets for additional Bank of Japan easing. The euro remained higher versus the pound before figures that may indicate growth accelerated in the eurozone. The dollar slipped 0.1 percent to 101.83 yen after touching 101.66, the lowest level since May 9. It traded at $1.3718 per euro from $1.3715.

WTI Drops From Three-Week High; Brent Remains Steady

West Texas Intermediate slid from a three-week high after government data showed crude inventories expanded as production increased to a 28-year peak in the U.S. Brent was steady in London. Futures fell as much as 0.5 percent in New York, the first drop in four days. Crude stockpiles rose to a near-record last week as output climbed to the highest rate since 1986. WTI for June delivery declined as much as 47 cents to $101.90 a barrel on the New York Mercantile Exchange reaching $102.11 at 3:15 p.m. Sydney time. The volume of all futures traded was about 19 percent below the 100-day average. Prices are up 3.8 percent this year. Brent for June settlement was 11 cents lower at $110.08 a barrel on the London-based ICE Futures Europe exchange.

That sums up today’s highlights! Catch up on all the latest news on Facebook, Google+,Twitter and LinkedIn. We hope you have a profitable day on the markets.

Just A Minute!

Here’s today’s ‘Just A Minute’ bringing you a 60 second summary of what’s happening in the markets:

Main Trading Event Of The Day: USD JOLTS Job Openings @ 14.00 GMT

WHAT WE’RE WATCHING TODAY

Signs Of A Global Recovery But Economy Going Nowhere Says Top Forecaster

Companies across the globe are increasingly confident about the economic recovery and their own finances for the coming quarter, which shows more countries are planning to increase their staffing in almost six years, according to a survey. The quarterly employment outlook survey by Manpower Group showed that companies in 38 out 42 countries indicated plans to hire more workers in the second quarter, the largest number since the third quarter of 2008. The mildly positive tone of the quarterly survey suggests the global economic recovery will continue with higher rates of employment helping to boost business output and consumer spending. The second-quarter survey results don’t exactly point to a turnaround in Europe, but there are several indications that employer optimism is gradually improving.

While the Federal Reserve, the White House and many private-sector economists support these predictions for stronger growth in 2014, one of the most accurate forecasters in the business, Stephen Stanley, chief economist for Pierpont Securities, disagrees saying that he doesn’t see the impetus for 3% growth. He believes the economy will be satisfactory, with growth in the 2% to 2.5% range, but below the 2.7% to 3.3% expected by the Fed, the White House, the Congressional Budget Office and private forecasters. The recent spate of unseasonably cold and snowy weather has upset the usual tools for forecasting the near-term trajectory of the economy. There’s no doubt that many of the economic indicators of job growth, factory production, retail sales and housing have been massively distorted by the effects of the weather but we are unlikely to really know what the underlying strength of the economy is until the April and May data come in. Stanley is also skeptical that the relaxation in fiscal policy this year will have any meaningful impact on growth or give any support to the economy.

Oil Prices Drop After Data From China & Japan Show Weak Trade

The price of oil fell below $102 on Monday after an unexpected drop in China’s exports and weaker economic growth in Japan showed demand for crude could weaken. Benchmark U.S. crude for April delivery was down $1.18 to $101.40 per barrel. On Friday, the contract rose $1.02 to close at $102.58 after strong U.S. employment figures for February. Brent crude was down 90 cents to $108.11. China’s customs data showed over the weekend that exports plunged by an unexpectedly large 18 per cent last month. Robust trade is crucial in helping China achieve its official economic growth target of 7.5 per cent for this year. However, exports in February last year might have been overstated by exporters inflating sales figures as an excuse to evade currency controls and bring extra money into China. Japan revised down its growth estimate for the final three months of last year after announcing a record current account deficit for January. Oil prices surged last week due to severe winter in the U.S. that raised demand for oil and tensions over Russia/Ukraine political situation.

Stocks Update: Facebook, Rio Tinto

Facebook shares have jumped 32 percent so far this year, compared with a 1.6 percent gain for the Standard & Poor’s 500 Index. The surge has left the 49 analysts who cover Facebook divided. 38 of them recommend the company with the equivalent of a buy rating but 21 of the total now have share-price targets below where Facebook is trading. That translates to an average 12-month price target of $72.46 for Facebook, less than 1 percent above the company’s closing price of $72.03 yesterday. With the stock advancing more rapidly than anticipated, the price targets suggest that analysts on average see little upside to the stock which may force some of the bulls to adjust their projections. Facebook’s rally to $72.03 a share has already left it trading at 122 times trailing 12-month earnings, making it more expensive than 98 percent of all companies in the S&P 500.

Meanwhile, Rio Tinto Group, the world’s second-biggest iron ore shipper, said short-term price fluctuations will continue after a credit squeeze in China and high stockpiles plunged the commodity into a bear market. Proof of short-term volatility is being seen this week whilst the market is continuing to see an attractive longer term demand for iron ore, driven particularly by China. Iron ore this week extended its decline, slumping by the most since August 2009, amid concern that demand in China is slowing just as rising output signals a global glut. The Chinese government’s credit squeeze and high stockpiles are driving the rapid change of sentiment.

That sums up today’s highlights! Keep in touch with all the latest market events via our Facebook, Google+, Twitter & LinkedIn pages. We hope you have a profitable day on the markets.

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