This page has been archived and commenting is disabled.

Daily US Opening News And Market Re-Cap: August 26

Tyler Durden's picture




 

From RanSquawk:

  • Markets focus on Fed Bernanke’s Jackson Hole speech in anticipation of getting a glimpse into the Fed’s monetary policy stance going forward
  • S&P sovereign ratings head, David Beers, said that the AAA rating for the US is not likely in the near term, and S&P is looking very carefully at France’s evolving fiscal strategy
  • Speculation that the German Chancellor Merkel may be ousted as early as September weighed on the DAX future
  • RBA’s chief Stevens said that the central bank may act to lessen the upward pressure on inflation, which helped AUD
  • CHF weakened on the back of market talk that the SNB may announce further measures to curb the currency's strength

Market Re-Cap
 
Fed Bernanke's Jackson Hole speech due at 1500BST (0900CDT) remains the main focus today, which will be closely watched for the Fed's monetary policy stance going forward. European equities traded lower, amid thin volume, with particular underperformance seen in the DAX future, partly on the back of speculation that the German Chancellor Merkel may be ousted as early as September owing to discontent within her coalition. In other equity news, Swiss banks came under pressure following market talk of potential for an extra levy imposed on them. Elsewhere, the USD-Index traded lower ahead of Fed's Bernanke speech, which in turn provided strength to EUR/USD, GBP/USD and commodity-linked currencies, whereas AUD received further support following hawkish comments from RBA's governor Stevens overnight. In other forex news, JPY gained strength across the board following higher than expected CPI data from Japan, however weakness was observed in CHF on the back of market talk that the SNB may announce further measures to curb the currency's strength.
 
Moving into the North American open, apart from Bernanke's Jackson Hole speech, markets look ahead to the second GDP reading from the US, as well as the University of Michigan Confidence report.
 
Asian Headlines:
 
Japan’s prime minister Naoto Kan resigned, meanwhile, Japan’s Parliament approved two major bills dealing with a government bond issue and renewable energy. (RTRS)
 
•    Japan National CPI (Jul) Y/Y 0.2% vs. Exp. 0.0% (Prev. 0.2%, Rev. to -0.4%) (RTRS)
 
Global News:
 
S&P sovereign ratings head, David Beers, said he is untroubled by dissenting views on the US rating adding that AAA rating for the US is not likely in the near term. He also said that global stock market sentiment had already weakened before the US downgrade, and troubles in Europe and US could hurt Asian ratings. Beers further said that he is waiting to see if Japan’s government is able to get act together to tackle short and long term issues. He also said that Greece rating means it is at risk of restructuring in very short term, and S&P is looking very carefully at France’s evolving fiscal strategy. He also said that Eurobonds could have credit implications. (RTRS/Sources)
 
US Headlines:
 
Fed’s Bullard said the Fed is ready to act if the economy weakens further or deflationary risks rise, adding that Fed’s promise to keep rates low until 2013 has put the Fed in a “box”. He further said that easing monetary policy by rebalancing Fed’s portfolio towards longer-end assets is unlikely to have much impact. (RTRS)
 
In other news, Fed’s balance sheet was USD 2.843trl in the week ended August 24th, compared with USD 2.842trl in the week ended August 17th. Also, foreign central banks’ overall holdings of US marketable securities at the Fed fell USD 1.169bln in the week ended August 24th to stand at USD 3.484trl. (RTRS)
 
EU and UK Headlines:
 
Eurozone finance ministry officials will try to rescue their EUR 109bln Greek bail-out deal by overhauling a controversial Finnish collateral agreement with Athens to open it up to other European creditor countries. European officials warned the new version, to be discussed on Friday, faced objections from some member states and potentially other institutions, such as the ECB and IMF. But three officials briefed on the talks said the group was looking at a proposal for a “non-cash” collateral arrangement where Greece would put up either real estate or shares in state-owned enterprises and financial institutions as a guarantee towards Eurozone bail-out loans. The new collateral would then be provided to all Eurozone members, or at least those who wished to participate in the scheme. (FT-More)
 
In other news, European Commission said it is premature to speculate on the outcome of talks with the private sector on final participation in a Greek bailout, adding that it has no reason to think that the private sector participation will be far from targeted figure of 90%. (RTRS)
 
•    UK GDP (Q2 P) Q/Q 0.2% vs. Exp. 0.2% (Prev. 0.2%)
•    UK GDP (Q2 P) Y/Y 0.7% vs. Exp. 0.7% (Prev. 0.7%) (RTRS)
 
•    Italian 6-month BOT auction for EUR 8.5bln, bid/cover 1.66 vs. Prev. 1.56 (yield 2.140% vs. Prev. 2.269%) (RTRS)
 
EQUITIES
 
European equities traded lower, amid thin volume, with particular underperformance seen in the DAX future, partly on the back of market talk that the German Chancellor Merkel may be ousted as early as September owing to discontent within her coalition. In other equity news, Swiss banks came under pressure following market talk of potential for an extra levy imposed on them. However, weakness in the USD-Index provided some support to the oil & gas and basic materials sectors. Moving into the North American open, equities continue to trade in negative territory, with financials and telecommunications as the best performing sectors.

FX
 
The USD-Index traded lower ahead of Fed's Bernanke speech, which in turn provided strength to EUR/USD, GBP/USD and commodity-linked currencies, whereas AUD received further support following hawkish comments from RBA's governor Stevens overnight. In other forex news, JPY gained strength across the board following higher than expected CPI data from Japan, however weakness was observed in CHF on the back of market talk that the SNB may announce further measures to curb the currency's strength.

COMMODITIES
 
WTI and Brent crude futures traded in negative territory in early European trade, markets remained tentative heading into today’s key US economic data and the much awaited Jackson Hole press-conference.
 
Oil & Gas News:

•    The CME Group lowered its margin requirement on trading US crude oil futures by 4%, which is the first reduction this year. The CME cut maintenance margins on crude oil futures for speculators to USD 6,000 per contract from USD 6,250, effective after the close of business on Monday.
•    Italian foreign minister said that Italian oil facilities in Libya are not damaged and they can restart as soon as security permitted.
•    Deutsche Bank lowered their average forecast for WTI crude to USD 94 per barrel and also trimmed their 2011 Brent forecast to USD112 per barrel in their latest report.
•    Nigeria is planning to export 2.1 MBPD of crude in October according to trade sources.
 
Geopolitical News:

•    Libya's rebels have stepped up their assault on the capital Tripoli, storming the Abu Salim neighbourhood as they continue to clear pockets of resistance in what is seen as the last stronghold of Gaddafi.
•    North Korean leader Kim told a Senior Chinese Diplomat that he is willing to return to nuclear talks without precondition and North Korea upholds aim of a nuclear free Korean peninsula.

Daily Us Opening News

 

- advertisements -

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
Fri, 08/26/2011 - 08:23 | 1603377 anynonmous
anynonmous's picture

Warren: no problem on the BAC thing it will be handled Thursday, and again I really appreciate that Schneiderman was dealt with

 

http://www.legalnewsline.com/news/233633-schneiderman-removed-from-mortg...

http://www.legalnewsline.com/news/233645-iowa-ag-feels-backlash-for-schn...

 

Things are going about as expected for New York Attorney General Eric Schneiderman when he decided to take on the full brunt of the White House and the largest megabanks in the country by trying to investigate the full load of their mortgage-related crimes over the past decade: Somewhat difficultly.

The Obama administration, in coordination with a group of all 50 state attorneys general, is trying to wrap up the multibillion dollar settlement with Bank of America, Wells Fargo,

http://gawker.com/5834095/all-the-powerful-people-really-hate-new-york-a...

Fri, 08/26/2011 - 09:34 | 1603620 glokk26L
glokk26L's picture

"BST"..... next to speech time....

That was worth a laugh.

Do NOT follow this link or you will be banned from the site!