Equity markets and high yielding currencies are seeing major advances higher as improved housing information in the USA and cited hopefulness in German business confidence surveys helps fuel a low volume, pre-Christmas rally. Other pieces of supportive stories came with the ECB's release of the first tranche of funds in its 3 year loan program and the successful bond auction in Spain. Yesterday's monetary policy meeting with the Bank of Japan was usually uneventful, with no change in the nations base rate and no new additions to its asset purchase plan.
Yesterday's macro information targeted on the US home market and German business confidence. US Housing Starts data rose to its highest level in 19 months and analysts will use this along with today's releases (MBA Mortgage Applications and Existing Home Sales) to figure out the validity of the overall trend. We shall also see some significant revenues releases in the household products sector as Walgreen's and Bed Bath & Beyond will report together with CarMax and Micron Technology. The primary headline in US equities came after Oracle released disappointing quarterly profits and dropped virtually 9% in the aftermarket session.
In ratings news, Fitch placed Italian and Spanish personal banks on "negative watch" and lowered its credit outlook on four further French banks, on the discussion that the European Financial Stability Facility may become insolvent itself and limit the ability of these banks to receive personal funding when required. The total impact of these statements was limited, as order flows seem to rule price activity but the longer term impact of these events is likely to be reviewed next year.
In the USA, the Fed Reserve has initiated plans to need banks to increase their capital reserve proportions (in accordance with Basel III global needs and the present Dodd-Frank bill). The general view is that this is a defensive move (instead of an attempt to limit pricing pressures) with the primary target of safeguarding banks against potential liquidity shocks that might enter the finance sector at later.
Today's price activity is suggestive of what can be seen when trading volumes lower. At the start of this week's trade, volatility slowed to a near halt before posting intraday gains of over 3% in some indices with very few elemental drivers. Due to these chances, traders should make preparations for the chance of astonishing and extreme moves in either direction and stop loss levels should be conservative.
Yesterday's macro information targeted on the US home market and German business confidence. US Housing Starts data rose to its highest level in 19 months and analysts will use this along with today's releases (MBA Mortgage Applications and Existing Home Sales) to figure out the validity of the overall trend. We shall also see some significant revenues releases in the household products sector as Walgreen's and Bed Bath & Beyond will report together with CarMax and Micron Technology. The primary headline in US equities came after Oracle released disappointing quarterly profits and dropped virtually 9% in the aftermarket session.
In ratings news, Fitch placed Italian and Spanish personal banks on "negative watch" and lowered its credit outlook on four further French banks, on the discussion that the European Financial Stability Facility may become insolvent itself and limit the ability of these banks to receive personal funding when required. The total impact of these statements was limited, as order flows seem to rule price activity but the longer term impact of these events is likely to be reviewed next year.
In the USA, the Fed Reserve has initiated plans to need banks to increase their capital reserve proportions (in accordance with Basel III global needs and the present Dodd-Frank bill). The general view is that this is a defensive move (instead of an attempt to limit pricing pressures) with the primary target of safeguarding banks against potential liquidity shocks that might enter the finance sector at later.
Today's price activity is suggestive of what can be seen when trading volumes lower. At the start of this week's trade, volatility slowed to a near halt before posting intraday gains of over 3% in some indices with very few elemental drivers. Due to these chances, traders should make preparations for the chance of astonishing and extreme moves in either direction and stop loss levels should be conservative.
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