Pivotfarm Daily News Harvest 18th August 2010

Markets in a Flash

·        
The Pound strengthened suddenly
this morning when UK
data came in better than expected. The EUR/GBP is moving back towards its
monthly lows

·        
The USD/JPY has started
trending down towards its lows in the past few hours.

·        
US equity futures are higher
this morning suggesting a continuation in the rise in equity markets from
yesterday’s session.

·        
Oil and Gold are not doing much
in today’s session at around $75.50 and $1230.00 respectively. Wheat futures
are pushing higher and are up nearly 3%.

·        
Asian markets finished higher
across the board overnight. The Nikkei 225 in Japan was up +1.32%.

·        
European equity markets are
higher this morning after going negative for a short while after the open.
Europe has been made more bullish by the strong UK data.

News Focus

0430ET
– UK
Retail Sales

Retail Sales m/m

Previous              0.7%                      Consensus          0.4%

Actual                   1.1%

This month’s UK retail sales were reported early
this morning and came in well ahead of consensus. The monthly change was
reported as a rise of 1.1% compared with the markets expectation of 0.4%. This
FTSE100 jumped higher on this news. Along with this news it was reported that
the UK’s
net public borrowing rose less than expected.

0830ET
– US Jobless Claims

Previous                              484 K                                     Consensus          480 K

Consensus Range            465 K to 495 K                    Actual                   500 K

Today’s Jobless
claims data of 500K is worse than expected and worse that last weeks. This
shows that the labour market in the US is worse than economists and
investors had thought. This is bearish for the markets and shows a continuation
in the rising trend.

German central bank raises growth forecasts

After the German
economy expanded in the second quarter at its fastest pace in the past two
decades the German central bank has increased its forecast growth rate. It has
raised its forecast of GDP growth to 3% for 2010 from the 1.9% prediction in
June.

General Motors confirms Initial Offering

The US car producer, General Motors Co, which is 61%
owned by the US
taxpayer is set to be brought to market. The company may face trouble with its
IPO as it continues to lose market share and struggles to return to profit.

Coming up Today

1000ET
– US Philadelphia
Fed Index

General Business Conditions Index - Level

Previous                              5.1                                          Consensus
         7.0 

Consensus Range            -0.6 to 10.0                                                                                         

This index is similar to the ISM
Manufacturing Index and tends to correlated with it. It is an index of
manufacturing conditions in the Philadelphia Federal reserve District.  The index has dropped in the past few months
from being around 20 to last month’s reading of 5.1. It is expected to show a
small rise today to 7.

1030ET – US Natural Gas
Report

The weekly report by the Energy Information
Administration provides data on US natural gas stocks. A report showing a drop
in natural gas stocks may signal increasing demand in the economy and see an
increase in the price of the commodity.

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