Posts Tagged ‘pound’

Late Market Rally Once Again Within Trading Range

Tuesday, June 8th, 2010

Trade was mostly choppy Tuesday, but the session finished on a strong note as the DJIA and S&P climbed in the final hour to close near their highs of the day.

The euro proved to be the primary catalyst for stocks. As has been the case in recent sessions its gains gave a lift to the major equity averages and its pullbacks prompted sellers to apply pressure. The euro had traded with weakness overnight amid calls from Fitch that the United Kingdom’s fiscal challenge is formidable and that a strong, medium term consolidation strategy is warranted. However, the euro was able to rebound and net a gain of roughly 0.3% at $1.196 after oscillating for most of the session.

The Dow rose 123.49 points, or 1.1%, to 9,939.98, with gains accelerating just before the close. The S&P once again brushed the 1044 mark. Trading range is beginning to tighten.

Investors still took comfort from Bernanke’s cautious reassurance given Monday night that the U.S. economy will continue to recover, but not at a pace strong enough to bring unemployment down quickly. 

The Fed chief said that the U.S. recovery probably began sometime late last summer, and that consumer spending and business investments appear to be taking over from the fading government stimulus in lifting the economy. “My best guess is we’ll have continued recovery, but it won’t feel terrific,” Bernanke said.

Already preparing to scale back, the U.K. government under new Prime Minister David Cameron warned the British public to brace for strict austerity measures. Similarly, Germany’s government announced 80 billion euros ($95.6 billion) in budget cuts over the next four years.

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Happy Anniversary to The 1 Year Bull Market!!

Tuesday, March 9th, 2010

Traders had expected some profit-taking today — even on stocks with good news — given how far the market has come in a year. Since March 9, 2009, the Dow is up 59 percent, the S&P rose 67 percent and the NASDAQ gained more than 80 percent.

The bulls have been forced to fight for every inch during the past several weeks, and this week is shaping up no differently. The S&P 500 Index (SPX) is now challenging its early January high near 1,150, while 10,600 appears to be the new 10,500 for the Dow Jones Industrial Average (DJIA). What’s more, the SPX has the added weight of its 160-month moving average overhead, a trendline that marked the index’s 2002 bottom and whose breach in October 2008 provided a clear demarcation between bull and bear markets. Additionally, the CBOE Market Volatility Index (VIX) rebounded yesterday, after sinking to within striking distance of a fresh multi-year low. The VIX was halted by resistance near the 18 level yesterday, but we could see the fear barometer spike to the 19 level and its 10-day moving average today. It appears that the bears have taken charge this morning, with futures on the Dow and SPX trading 35 points and 5.8 points below fair value, respectively.

Cisco CSCO  26.1599 has a big announcement slated for 11 a.m. ET. The networking-gear maker is expected to debut tools that will allow network-service providers to build their own high-speed networks. Cisco is taking a page out of Apple’s playbook, building hype in advance of the announcement. The company said yesterday that it’s announcement will “forever change the Internet and its impact on consumers, businesses and government.

China’s chief currency regulator reiterated the country’s commitment to U.S. Treasury’s for its foreign-exchange reserves, adding that China is not into short-term currency market speculation. He also said that it was “impossible” for gold to become a major investment channel for the country’s foreign exchange reserves.

In Europe

Greece Prime Minister George Papandreou is scheduled to meet President Barack Obama and is likely to press the U.S. to regulate hedge fund which Greece says had an important role in its debt problems. I highly doubt this will make an impact as regulating will delineate a free market concept.

Fitch issued a report about sovereign ratings in Europe in which it warned that Britain’s credit profile has deteriorated, pushing the pound to a 1-week low against the dollar.

A report by temporary-hiring firm Manpower showed that the outlook for U.S. hiring is dipping in the coming quarter, casting a shadow over hopes for a recovery in jobs.

Happy Anniversary to The 1 Year Bull Market!!

ACE

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