Greece on the ropes!
Today’s Data & journal links
Data sheets describing major market metrics, news and a journaling area for trading records in the centre of the pdf.
News and Views in brief
Greece's government was on the brink of collapse on Thursday, casting doubt on plans to hold a referendum on staying in the euro zone, as European leaders contemplated a Greek exit to preserve their single currency.
Prime Minister George Papandreou chaired an emergency cabinet meeting in Athens, with his finance minister in revolt against a plebiscite, after the leaders of France and Germany gave Greeks an ultimatum to make up their minds.
French President Nicolas Sarkozy and German Chancellor Angela Merkel told Papandreou at a torrid meeting in Cannes that Athens would not receive a cent more in aid until it votes to meet its commitments to the euro zone. Greece was due a vital 8 billion euros installment this month. http://www.reuters.com/article/2011/11/03/us-g-idUSTRE7A20E920111103
Investors don’t see a U.S. recession in the next 12 months, based on dividend swaps that indicate consumption of services may grow 1.8 percent by November 2012.
The annualized forecast as of yesterday held in the 11- month range of 1.8 percent to 2.2 percent, according to the four authors of a National Bureau of Economic Research report. They derived the estimates using “standard forecasting techniques” to calculate equity yields from dividend-swaps contracts, said Jules van Binsbergen, a faculty research fellow at the NBER and one of the authors. http://www.bloomberg.com/news/2011-11-03/dividend-swaps-signal-no-recession-for-u-s-as-european-debt-crisis-boils.html
European leaders could make progress in their drive for a financial transaction tax at a Group of 20 summit this week after French President Nicolas Sarkozy indicated Washington may prove less of a barrier than in the past.
An EU source told Reuters the United States now seemed "less problematic than the UK" in resisting a push led by Sarkozy to create a tax that is at least pan-European to fund development projects in poor nations.
A source in an international development organization told Reuters the United States still opposed the idea in principle but would not block others from going ahead with new taxes.http://www.reuters.com/article/2011/11/03/g20-tax-idUSL4E7M31ZQ20111103
European stocks advanced, erasing earlier losses, after Greek Prime Minister George Papandreou’s ruling party split over his call for a referendum on the latest bailout package, sparking speculation the vote may not happen.
Swiss Re Ltd. and Man Group Plc (EMG) gained more than 5 percent after reporting better-than-expected earnings. ArcelorMittal (MT) slumped 1.9 percent after posting third-quarter profit that missed analyst estimates.
The Stoxx 600 climbed 1.1 percent to 239.91 at 10:29 a.m. in London, after earlier falling as much as 1.5 percent. Futures on the Standard & Poor’s 500 Index added 0.5 percent, while the MSCI Asia Pacific Index slid 0.9 percent.http://www.bloomberg.com/news/2011-11-03/european-u-s-stock-index-futures-decline-on-greece-asian-shares-drop.html
Stock index futures pointed to a slightly higher opening for equities on Wall Street on Thursday, with futures for the S&P 500, for the Dow Jones and for the Nasdaq 100 up 0.1 to 0.2 percent.
The Labor Department is due to release at 8:30 a.m. EDT first-time claims for jobless benefits for the week ended October 29. Economists forecast a total of 400,000 new filings compared with 402,000 in the prior week.
NYSE Euronext, which is still in the throes of seeking regulatory support for its planned $9 billion merger with Deutsche Boerse, cited strong trading and technology sales as being behind a 54 percent rise in its third-quarter profit to $186 million.http://www.reuters.com/article/2011/11/03/us-markets-stocks-idUSTRE7A01NM20111103
The euro strengthened against the dollar and yen before Group of 20 leaders discuss the region’s debt crisis at a summit and Mario Draghi addresses his first policy meeting as European Central Bank President.
The shared currency advanced versus most of its major counterparts as European stocks gained, spurring demand for the region’s assets. The currency held gains after an official from Greece’s ruling party said Prime Minister George Papandreou may withdraw his proposal for a referendum on the nation’s planned bailout. The ECB will keep its key rate at 1.5 percent at today’s meeting, according to a Bloomberg News survey.http://www.bloomberg.com/news/2011-11-03/euro-strengthens-against-dollar-yen-ahead-of-g-20-ecb-meetings-today.html
The yuan closed up slightly on Thursday, but at the bottom of its daily trading band, after the central bank set the mid-point at a record high, underlining its intention of letting the currency appreciate at a quicker pace during the Group of 20 meeting in France.
That mirrored the trading pattern on Monday -- the People's Bank of Chinafixed the mid-point at a record high level and the yuan closed at the lower end of its daily trading band, but still up from the previous close.http://www.reuters.com/article/2011/11/03/markets-china-yuan-close-idUSL4E7M31EE20111103
Oil rose for a second day in New York, reversing losses as European leaders pressured Greece into proceeding with a rescue package that may stem the region’s debt crisis.
West Texas Intermediate futures on the New York Mercantile Exchange rebounded after dropping as much as 1.8 percent. Led by Germany and France, Europe’s economic and political anchors, the euro’s guardians yesterday cut off financial aid for Greece until an early December vote determines whether it deserves a fresh batch of loans.
“Market sentiment about the success of the rescue package seems to change within hours,” said Carsten Fritsch, a Frankfurt-based analyst at Commerzbank AG, who forecasts Brent crude oil will average $100 a barrel this quarter. “We expect Europe to slip into recession, but it will be just a brief and shallow one.” http://www.bloomberg.com/news/2011-11-03/oil-slides-after-europe-witholds-greek-aid-u-s-crude-stockpiles-increase.html
China reaped its seventh record corn crop in eight years in the harvest now ending. That still won’t be enough to meet demand, driving a fivefold gain in imports as prices head for the highest-ever annual average.
Production reached 189.2 million metric tons in the harvest that began in September, 6.7 percent more than a year earlier, according to a survey of growers in the seven main producing regions carried out by Geneva-based SGS SA for Bloomberg. Imports in the marketing year that began last month may jump to 5 million tons from 1 million tons, according to the median estimate of 10 analysts and traders surveyed by Bloomberg.http://www.bloomberg.com/news/2011-11-03/china-record-corn-crop-still-failing-to-meet-demand-for-feed-commodities.html
OPEC oil producer Qatar is optimistic that the euro zone crisis currently dominating oil market sentiment will be resolved soon, Qatari energy minister Mohammed al-Sada said on Thursday, adding that oil market fundamentals are balanced.
"How the euro zone solves the challenge is dominating the movement in (oil) prices on a daily basis," Mohammed al-Sada told Reuters at an event in Doha. "(But oil market) fundamentals look very good. Supply demand and stock levels are all very healthy. No one is complaining about that." http://www.reuters.com/article/2011/11/03/qatar-oil-euro-idUSL5E7M32N820111103