Pivotfarm Daily News Harvest 20th August 2010

Markets in a Flash

·        
As European markets opened and
fell this morning and a correlating fall has been seen in the EUR/USD currency
pair after comments by ECB council member Axel Weber suggested that that the
ECB will support the region’s banks for longer than some investors expected.

·        
The USD/CAD saw a strong jump
north breaking the 1.0500 level as Canadian Core CPI data came in less than
expected.

·        
The GBP looks weak today along
with the EUR as European equity markets fell. The JPY and USD seem to be strong
against the two.

·        
Prior to the open of the US equity
markets the equity futures markets are lower this suggests that the European
downtrend will be followed at the opening bell.

·        
Most commodities are lower
today. Oil is down to $73.00 while gold is holding its gains at just above
$1230.00. Sugar is bucking the trend and is nearly +2.5% higher.

·        
Asian markets finished lower
across the board last night. The Main Japanese and Chinese indices were down
nearly -2%.

·        
European equity markets lower
this morning. The Stoxx 50 is lower by over -1.0%.

News Focus

0700ET
– Canada
Core CPI m/m

Previous              -0.1%                                     Consensus          0.1%

Actual                   -0.1%

Today’s release by Statistics Canada shows
that core inflation was less than expected, this was bad for the Canadian
dollar and saw it weaken on the news. After recent interest rate rises in the
country this flat rate of inflation should be expected. If the figure had come
in majorly higher it or does next month it may mean another interest rate rise
is on the card, but today’s data shows no indication of this.

China may be interested in
Potash

Sinochem, Chinas
state owned Chemical producer, has said it is interested in Potash’s overseas
investments and is keeping a close eye on BHP Billitons Bid. The Australian
miners $130 a share hostile bid for the fertilizer producer is at the moment
uncontested.  If Sinochem make a counter
offer it may mean a much high bid price. Potash’s CEO is set to benefit hugely
from a takeover of the company as in a takeover situation his company options
become excersisable and very valuable.

Intel set to buy McAfee for $7.7Bn

The takeover of
the software security company is set to boost Intel strategy in the mobile
wireless technology world. The chip producer may be able to integrate the
security abilities of McAfee directly into its computer chips, this will
enhance security capabilities into the future as computing devices become
widely connected and more susceptible to viruses.

News Coming Up

Australian
General Election

The Australian general election date was
set for 21^st August by Julia Gillard, Prime Minister. The controlling
Labour party lead by Mrs Gillard, who took over from her predecessor only 3
weeks ago, is predicted to win by opinion polls in the country. A win will
secure the party a further 3 year term. Gillard says she is committed to moving
forward with budget surpluses and the economy. The result of the election may
have effects on the strength of the Australian Dollar and the Countries large
miners.

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Comments

[covert]

http://covert2.wordpress.com

[Amsterdammer]

Axel Weber is just sending a 'signal', while his

boss is on holiday, that Europe's major weakness,i.e

the banks, will only be properly addressed after

G-20 in November and its approval / disapproval of

Basel III issues. European banks have EUR 2 trillion to

refinance before end 2012, and according to S&P,

total liabilities are 300 trillion.

[kathy.chamberli...]

i like your format, easy understandable mr H A R V E S T

The Australian general election date was set for 21^st August

now i am just in awe that countries have elections on a saturday. US of A is so ass backwards on a tuesday, major elections. it is to distract, weapons of mass distraction is all we have here. works, really really well control power you explained it Heph on thu 08/19 06:08. it is complicated.

[SWCroaker]

Canadian Core CPI being low reflects a strong loonie.  So because the loonie is strong, it pushes a measure of prices often mistaken as a measure of inflation down, and *tada* that is rational for the loonie to be valued less and made weaker.

Wha?  Good thing my day job involves spatial algorithms, nth order derivatives (mathematical, not investment grade), and lots of integrals.  This economics stuff gives me a headache...