UK Financial Stability Report

Location: United Kingdom

Date: 26/06/2013

Time: 10:30 - 11:30

Strength: 2/3

Previous:

Notes: The Financial Stability Report, published twice a year by the Bank of England under the guidance of the interim Financial Policy Committee, shows the Committee's assessment of the outlook for the stability and resilience of the financial sector at the time of preparation of the Report, and the policy actions it advises to reduce and mitigate risks to stability. Usually, if the BoE is hawkish about the financial outlook, it is positive, or bullish, for the GBP. Likewise, if the BoE has a dovish view on the UK economy and is concern about the financial stability it is seen as negative, or bearish.

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UK Inflation Report Hearings

Location: United Kingdom

Date: 26/06/2013

Time: 10:00 - 11:00

Strength: 3/3

Previous:

Notes: The Treasury Committee is appointed by the House of Commons to examine the expenditure, administration and policy of HM Treasury, HM Revenue & Customs, and associated public bodies, including the Bank of England and the Financial Services Authority.

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DE Gfk Consumer Confidence Survey

Location: Germany

Date: 26/06/2013

Time: 7:00 - 8:00

Strength: 2/3

Previous: 6.5 / Consensus: 6.5

Notes: The GfK Consumer Confidence is a leading index that measures the level of consumer confidence in economic activity. A high level of consumer confidence stimulates economic expansion while a low level drives to economic downturn. Generally speaking, a high reading is positive (or bullish) for the EUR, while a low reading is seen as negative (or bearish).

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The 6am Cut

6am Cut London Posted 2013-06-26 05:41:10 by Kate Mackenzie Asian stocks rose, gold slumped and the dollar strengthened after better-than-expected US durable goods data. The Nikkei was flat but the Hang Seng rose 1% and the MSCI Asia Pacific was up 0.4%. However the Shanghai Composite continued to fall, sliding 1.2%. (Bloomberg) Chinese interbank lending rates dropped after the PBoC made clear it would provide liquidity support where needed, and said it had already provided such support. The one-year interest-rate swap, the fixed cost needed to receive the floating seven-day repo rate, slid 16bps to 3.91% by late morning in Shanghai, according to Bloomberg calculations. The overnight and seven-day repo rates fell 40bps and 78bps respectively. (Bloomberg)(Financial Times) "Italy risks potential losses of billions of euros on derivatives contracts it restructured at the height of the eurozone crisis, according to a confidential report by the Rome Treasury that sheds more light on the financial tactics that enabled the debt-laden country to enter the euro in 1999." (Financial Times) Bond yields could undermine recovery in global banks' balance sheets: Under new capital rules, unrealised losses in these "available for sale" portfolios hit banks' equity capital. "I would think most institutions are going to have a fairly sizeable hit to their equity," said a senior executive of a top US bank. (Financial Times) King criticises 'meddling' banks in final public BoE appearance: "Sir Mervyn complained that bankers left meetings with the new Prudential Regulation Authority about increasing their capital stocks and immediately called the prime minister and chancellor to put "tremendous pressure" on politicians to water down the rules." He said that in at least one case, calls were then made to the PRA about the banks' concerns." (Financial Times) Dublin worries that Anglo Irish tapes will harm its attempts to win debt relief from the EU. "It makes it more difficult, of course it does, but we're going to continue to work to get the best possible outcome for the Irish taxpayer," said Eamon Gilmore, Ireland's deputy prime minister on Tuesday. (Financial Times) US oil and natural gas operations are increasingly vulnerable to cyber attacks that can harm competitiveness and lead to costly outages at pipelines, refineries or drilling platforms, a new Council on Foreign Relations report says. (Reuters) COMMENT AND CURIOS: - Martin Wolf: Careless talk may cost the economy. (Financial Times) - Ralph Atkins: Draghi must act so the eurozone is not a major casualty of US tapering. (Financial Times) - Analysis: Young and educated with a dead-beat job in Europe. (Reuters) - Peter Orszag: Young and educated with a dead-beat job in the US. (Bloomberg) - Analysis: Young and educated with a dead-beat job in Japan. (Bloomberg) - Shadow banking is carrying on unscathed in Wenzhou. (Bloomberg) - Peer-to-peer lending delivers higher returns than equity investing in the same companies. (Financial Times) - US is number one foreign investment destination for the first time in 12 years. (Reuters) OVERNIGHT MARKETS: UP Asian markets Nikkei 225 down -0.21 (0.00%) at 12,969 Topix down -2.26 (-0.21%) at 1,076 Hang Seng up +202.08 (+1.02%) at 20,058 US markets S&P 500 up +14.94 (+0.95%) at 1,588 DJIA up +100.75 (+0.69%) at 14,760 Nasdaq up +27.13 (+0.82%) at 3,348 European markets Eurofirst 300 up +16.18 (+1.45%) at 1,130 FTSE100 up +72.81 (+1.21%) at 6,102 CAC 40 up +54.19 (+1.51%) at 3,650 Dax up +118.85 (+1.55%) at 7,811 Currencies €/$ 1.31 (1.31) $/¥ 97.78 (97.80) £/$ 1.54 (1.54) Commodities ($) Brent Crude (ICE) down -0.47 at 100.79 Light Crude (Nymex) down -0.73 at 94.59 100 Oz Gold (Comex) down -23.30 at 1,252 Copper (Comex) unchanged 0.00 at 3.07 10-year government bond yields (%) US 2.60% UK 2.55% Germany 1.80% CDS (closing levels) Markit iTraxx SovX Western Europe -0.03bps at 97.83bp Markit iTraxx Europe -4.06bps at 128.16bp Markit iTraxx Xover -16.74bps at 511.79bp Markit CDX IG -5.49bps at 92.1bp Sources: FT, Bloomberg, Markit
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US Housing Price Index (MoM)

Location: United States

Date: 25/06/2013

Time: 14:00 - 15:00

Strength: 2/3

Previous: 1.3%

Notes: The Housing Price Index released by the Office of Federal Reserve Housing Enterprise Oversightprovides an estimated value of housing market conditions. It is an important indicator as the housing market is considered as a sensitive factor to the US economy. Generally speaking, a high reading is seen as positive (or bullish) for the USD, while a low reading is seen as negative (or bearish).

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US Durable Goods Orders

Location: United States

Date: 25/06/2013

Time: 13:30 - 14:30

Strength: 2/3

Previous: 3.3% / Consensus: 1.8%

Notes: The Durable Goods Orders, released by the US Census Bureau, measures the cost of orders received by manufacturers for durable goods, which means goods planned to last for three years or more, such as motor vehicles and appliances. As those durable products often involve large investments they are sensitive to the US economic situation. The final figure shows the state of US production activity. Generally speaking, a high reading is bullish for the USD.

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US Durable Goods Orders ex Transportation

Location: United States

Date: 25/06/2013

Time: 13:30 - 14:30

Strength: 2/3

Previous: 1.3% / Consensus: 0.1%

Notes: The Durable Goods Orders measures, released by the US Census Bureau, the cost of orders received by manufacturers for durable goods, which means goods planned to last for three years or more, excluding the transport sector. As those durable products often involve large investments they are sensitive to the US economic situation. Generally speaking, a high reading is bullish for the USD, while a low reading is seen as Bearish.

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UK BBA Mortgage Approvals

Location: United Kingdom

Date: 25/06/2013

Time: 9:30 - 10:30

Strength: 2/3

Previous: 32.2K / Consensus: 33.1K

Notes: The Mortgage Approvals published by the British Bankers' Association (BBA) measure the number of home loans issued by the BBA during the previous quarter. It is considered as a leading indicator of the UK Housing Market. A Mortgage growth represents a healthy housing market that stimulates the overall UK economy. Normally, a high reading is seen as positive (or bullish) for the GBP, while a low reading is seen as negative (or bearish)

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The 6am Cut

6am Cut London Posted 2013-06-25 05:45:28 by Kate Mackenzie Chinese stocks sank to a four-year low, pulling most other Asian markets lower as worries grew about the country's tight liquidity. The Nikkei was off 1.7% and the MSCI Asia Pacific fell 1.2% and copper reached a three-year low. (Reuters)(Bloomberg) China's seven-day repo rate rose 68 basis points today to 8%, and the overnight rate fell 47bps to 6%, according to a fixing by the National Interbank Funding Center. (Bloomberg) Fed's Fisher fights 'feral hogs': Dallas Fed president Richard Fisher told the FT the Fed had anticipated a lively market reaction to last week's comments on QE tapering. But Fisher, an FOMC voting member, warned that markets should not think the Fed would end up propping up the economy indefinitely. " I do believe that big money does organise itself somewhat like feral hogs. If they detect a weakness or a bad scent, they'll go after it." (Financial Times) Parts of UK and US risk becoming 'uninsurable' as oceans warm: Global insurance industry trade body the Geneva Association issued a rare warning that the speed at which the oceans are warming is threatening their ability to sell affordable policies in a growing number of places around the world, including parts of the UK and Florida. (Financial Times) Sumitomo Life weighing Negara stake: "Sumitomo Life Insurance Co. is among companies preparing to bid for a stake in the life insurance unit of PT Bank Negara Indonesia (BBNI), according to two people with knowledge of the matter." (Bloomberg) Copper hit a three-year low and other industrial metals tumbled as traders feared that China's liquidity squeeze could dent demand, as the country accounts for 40% or more of the global market for each metal. (Financial Times) The financial crisis has fuelled a huge expansion of organised crime in Europe with 3,600 criminal syndicates now active across the continent, profiting even from such prosaic products as household detergents, the head of Europol has warned. (Financial Times) The CFTC plans to approve the a civil lawsuit against Jon Corzine over the collapse of MF Global as soon as this week, according to law enforcement officials with knowledge of the case. (NYT Dealbook) Convertible bonds are back in fashion. This month will be the most active for issuance in two years, triggered by speculation about a Fed easing exit. (Financial Times) Sinopec pays $1.52bn for Angolan oilfield stake: The Chinese energy group and Asia's largest refiner, has agreed to pay $1.52bn for a share in an Angolan oilfield owned by Marathon Oil. (Financial Times) COMMENT AND CURIOS: - Bond market exit becoming stampede? (NYT Dealbook) - Where the bankers are: Singapore. (Bloomberg) - A woman, not Churchill, for £5 note. (Financial Times) OVERNIGHT MARKETS: DOWN Asian markets Nikkei 225 down -225.38 (-1.73%) at 12,837 Topix down -20.47 (-1.88%) at 1,069 Hang Seng down -280.93 (-1.42%) at 19,533 US markets S&P 500 down -19.34 (-1.21%) at 1,573 DJIA down -139.84 (-0.94%) at 14,660 Nasdaq down -36.49 (-1.09%) at 3,321 European markets Eurofirst 300 down -18.49 (-1.63%) at 1,114 FTSE100 down -87.07 (-1.42%) at 6,029 CAC 40 down -62.41 (-1.71%) at 3,596 Dax down -96.79 (-1.24%) at 7,692 Currencies €/$ 1.31 (1.31) $/¥ 97.37 (97.72) £/$ 1.54 (1.54) Commodities ($) Brent Crude (ICE) down -0.40 at 100.76 Light Crude (Nymex) down -0.52 at 94.66 100 Oz Gold (Comex) up +1.70 at 1,279 Copper (Comex) unchanged 0.00 at 3.03 10-year government bond yields (%) US 2.54% UK 2.55% Germany 1.82% CDS (closing levels) Markit iTraxx SovX Western Europe +5.38bps at 97.86bp Markit iTraxx Europe +8.41bps at 132.22bp Markit iTraxx Xover +28.22bps at 528.53bp Markit CDX IG +3.8bps at 97.59bp Sources: FT, Bloomberg, Markit
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US Chicago Fed National Activity Index

Location: United States

Date: 24/06/2013

Time: 13:30 - 14:30

Strength: 2/3

Previous: -0.53

Notes: The Chicago Fed National Activity Index (CFNAI), released by Federal Reserve Bank of Chicago, is a monthly index designed to gauge overall economic activity and related inflationary pressure.

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DE IFO - Business Climate

Location: Germany

Date: 24/06/2013

Time: 9:00 - 10:00

Strength: 2/3

Previous: 105.7 / Consensus: 105.7

Notes: This German business sentiment index released by the CESifo Group is closely watched as an early indicator of current conditions and business expectations in Germany. The Institute surveys more than 7,000 enterprises on their assessment of the business situation and their short-term planning. The positive economic growth anticipates bullish movements for the EUR, while a low reading is seen as negative (or bearish).Review Alex Nekritin's Article - Trading Euro with IFO Report

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DE IFO - Expectations

Location: Germany

Date: 24/06/2013

Time: 9:00 - 10:00

Strength: 2/3

Previous: 101.6 / Consensus: 102.0

Notes: The IFO Expectations released by the CESifo Group is closely watched as an early indicator of current conditions and business expectations for the next six months, where firms rate the future outlook as better, same, or worse. An optimistic view of those 7,000 business leaders and senior managers is considered as positive, or bullish for the EUR, whereas a pessimistic view is considered as negative, or bearish.Review Alex Nekritin's Article - Trading Euro with IFO Report

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DE IFO - Current Assessment

Location: Germany

Date: 24/06/2013

Time: 9:00 - 10:00

Strength: 2/3

Previous: 110.0 / Consensus: 109.5

Notes: The IFO Current Assessment released by the CESifo Group is closely watched as an indicator of current conditions and business expectations in Germany. The Institute surveys more than 7,000 enterprises on their assessment of the business situation and their short-term planning. The positive economic growth anticipates bullish movements for the EUR, while a low reading is seen as negative (or bearish).Review Alex Nekritin's Article - Trading Euro with IFO Report

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UK Nationwide Housing Prices n.s.a (YoY)

Location: United Kingdom

Date: 24/06/2013

Time: 7:00 - 8:00

Strength: 2/3

Previous: 1.1% / Consensus: 2.0%

Notes: The Nationwide Housing Prices shows the value of the houses prices in UK and indicate current movements in the housing market that is considered as a sensitive factor to the UK's economy. A high reading is seen as positive (or bullish) for the GBP, while a low reading is seen as negative (or bearish).

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The 6am Cut

London 6am Cut Posted 2013-06-21 05:34:33 by Joseph Cotterill Chinese interbank rates eased after reports of central bank support. The one-day repo rate receded 3.84 percentage points to 7.9 per cent, its biggest drop since 2007, while the seven-day rate fell 3.51 percentages points from the record high it set on Thursday (Bloomberg). Fed casualties watch: Pimco's Total Return Fund is now down 2.2 per cent for the year, the worst performing of large US total return funds (Bloomberg); Having fallen below $1,300, gold's 23 per cent slump this year is on course to be its worst since 1981 (Bloomberg); Thursday's bond sell-off saw ETFs' discounts to underlying asset values widen sharply, with cash redemptions halted for some (Financial Times). The ESM has been authorised to 'directly recapitalise' eurozone banks but only if governments make their own investments in stricken lenders first, and with retroactive application of the new powers to be decided on a 'case by case' basis. Eurozone financial ministers also confirmed the size of the direct recap funds to be €60bn, unless later expanded by the ESM board. The ESM expects the tool to become operational in the second half of 2014 (Financial Times). Oracle's revenue growth stagnated for another quarter. Revenues from new software licenses and cloud offerings increased by only 1 per cent in the second quarter. Oracle shares fell 8 per cent after the close, despite a doubling of its dividend and authorisation for a $12bn stock buyback (Wall Street Journal). The IMF has warned eurozone creditors of gaps in financing Greece's bailout, placing its distribution of aid in July in doubt. National eurozone central banks' refusal to roll over their maturing holdings of Greek bonds has compounded the €3bn-€4bn shortfall (Financial Times). Softbank's chief executive revealed the ambition behind its $21.6bn bid for Sprint Nextel. "We want to be the world's No.1 company in various terms including profit, cashflow and market value," Masayoshi Son told shareholders on Friday (Bloomberg). UK prosecutors alleged that former Libor trader Tom Hayes conspired with employees at eight banks and interdealer brokers. The companies named at a court appearance by Hayes, who has been charged with eight counts of "conspiring to defraud", included Tullett Prebon. The broker said on Thursday that it has been asked to provide information to investigators, but that it has not been told that it or its employees are being investigated (Wall Street Journal). COMMENT AND CURIOS - Did Bernanke just let down an asset bubble?, asks John Authers. (Financial Times) - Investors won't get fooled again by Russian growth, Sergei Guriev says. (Financial Times) - The real central bank exit to worry about might be the ECB's... (Financial Times) - Why triathlon-going 'middle aged men in Lycra' should take it easy. (Bloomberg) - Brazil's protests are pretty unlike elsewhere. (Reuters) OVERNIGHT MARKETS: DOWN Asian markets Nikkei 225 down -63.97 (-0.49%) at 12,950 Topix down -13.30 (-1.22%) at 1,078 Hang Seng down -305.59 (-1.50%) at 20,077 US markets S&P 500 down -40.74 (-2.50%) at 1,588 DJIA down -353.87 (-2.34%) at 14,758 Nasdaq down -78.56 (-2.28%) at 3,364 European markets Eurofirst 300 down -36.22 (-3.07%) at 1,143 FTSE100 down -189.31 (-2.98%) at 6,159 CAC 40 down -140.41 (-3.66%) at 3,694 Dax down -268.60 (-3.28%) at 7,928 Currencies €/$ 1.323 (1.325) $/¥ 97.29 (96.92) £/$ 1.55 (1.555) Commodities ($) Brent Crude (ICE) up +0.42 at 102.57 Light Crude (Nymex) up +0.17 at 95.31 100 Oz Gold (Comex) up +1.2 at 1,287 Copper (Comex) up 0.01 at 3.07 10-year government bond yields (%) US 2.42 UK 2.29 Germany 1.66 CDS (closing levels) Markit iTraxx Europe +12.3bps at 119bp Markit iTraxx Xover +45bps at 484.7bp Markit CDX IG +5.3bps at 92.6bp Sources: FT, Bloomberg, Markit
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