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Daily US Opening News And Market Re-Cap: January 10

Tyler Durden's picture




 

From RanSquawk

  • Markets climb on the back of Fitch comments stating France should not expect a ratings downgrade throughout 2012.
  • Speculation that China may conduct expansionary monetary policy in order to strengthen consumer demand and exports.

Market Re-Cap
 
Markets are moving positively across the board today following comments from Fitch, dampening speculation that France may be downgraded from its Triple A status. Fitch’s Parker commented that he does not expect to see France downgraded at all throughout 2012. However he added that there are continuing pressures for France from national banks and EFSF liabilities, Parker also reinforced German confidence stating that Germany’s Triple A rating is safe. Markets were also experiencing upwards pressure from strong French manufacturing data performing above expectations and successful Austrian auctions today, tightening the spread between France and Austria on 10-year bunds.
 
Asian Headlines
 
China revises its GDP growth for 2011 upwards from 10.3% to 10.4%.
 
•  Chinese Trade Balance (USD) (Dec) 16.52bln vs. Exp. 8.80bln (Prev. 14.53bln)
•                     Chinese Exports Y/Y (Dec) 13.4% vs. Exp. 13.4% (Prev. 13.8%)
•                     Chinese Imports Y/Y (Dec) 11.8% vs. Exp. 18.0% (Prev. 22.1%)
 
EU and UK Headlines
 
The French economy was reassured today as Fitch’s Parker announced he did not expect a French downgrade this year as well as strong manufacturing production and industrial production being reported above expectations, Fitch also added that German economy still has a safe top debt rating.
 
The Greek government and its private creditors are reportedly edging ever closer to a deal on the PSI, although the IMF appears reserved regarding the plan’s effectiveness.
 
Citigroup’s Chief Economist Willem Buiter has commented on Ireland saying that the state clearly needs further financial assistance on “non-market terms”.
 
•  Bank of France Business Sentiment (Dec) M/M 96 vs. Exp. 95 (Prev. 95)
•  French Industrial Production (Nov) M/M 1.1% vs. Exp. -0.2% (Prev. 0.0%, Rev. 0.1%)
•  French Industrial Production (Nov) Y/Y 0.9% vs. Exp. -0.4% (Prev. 1.8%, Rev. 1.7%)
•  French Manufacturing Production (Nov) M/M 1.3% vs. Exp. -0.4% (Prev. 0.0%, Rev. 0.2%) 
• French Manufacturing Production (Nov) Y/Y 2.2% vs. Exp. -0.1% (Prev. 2.6%)
 
EQUITIES
 
Equity markets have shown positive changes across the board in the first half of the European session on the news that France will not be expecting a downgrade from Fitch during 2012. Top performing sectors as of the midpoint of the European session were: Basic Materials (+3.27%), Financials (+3.01%), Industrials (+1.91%) with the worst Performing sectors: Technology (-0.34%), Healthcare (-0.14%), Telecommunications (+0.94%).
 
European equities were also buoyed by a positive earnings report from Alcoa, whose shares were up 2.5% premarket.

FX
 
FX markets have been reacting to Fitch’s announcements today, strengthening the EUR and pushing the EURUSD upwards at the midway point of the European session. AUDUSD is trading up by 93pips, possibly due to market talk at the beginning of the European session concerning bids by Macro funds (unconfirmed).
 
COMMODITIES
 
At the North American open, WTI Crude futures are up following a weakening of the USD which is partly a result of risk-on sentiment following Fitch’s comments that it expects France will remain a Triple A nation.
 
Oil & Gas News:
•  Saudi Arabia has said it plans to keep Domestic Gas feedstock prices unchanged in 2012, however they may change next year.
•                     Saudi Arabia is also to supply full term Crude volumes in February to Asian refineries.
•  Bank of America sees a small recovery in 2013, expects prices to average USD 3.80/MMBTU from USD 4.70 MMBTU prior.
 
Geopolitical News:

•  OPEC will not get involved in any international dispute involving Iran according to Venezuela’s Oil Minister.
•  According to an ex-US adviser on Iran, Iran is unlikely to shut down the Strait of Hormuz in response to Western sanctions.
•  Saudi Arabia have said they will not enter the Japanese political debate on Iranian oil, adding that the Saudi Arabia supplies oil on a commercial and not political basis.
•  Tehran is preparing an underground test of a one-kiloton nuclear device during 2012, much like the test carried out by North Korea in 2006. Underground facilities are under construction in great secrecy behind the noise and fury raised by the start of advanced uranium enrichment at Iran's fortified, subterranean Fordo site near Qom, according to DEBKA file's Iranian sources.
 
Corporate News:

•  Exxon reported unplanned flaring due to a breakdown at its refinery in Torrance, California.
•  Genel Energy is looking to double production in a key oilfield in northern Iraq from 42,800 BPD to 100,000 BPD by the end of the year as it lays out plans for significant upgrading work.

 

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Tue, 01/10/2012 - 09:07 | 2049726 slaughterer
slaughterer's picture

Two things:

1) Since when does Fitch really matter?

2) Who spoke from China?  The head of the Central Bank?  NO. The market regulator.  The phrase being circulated ("actively push") is a faulty translation.  Everybody is so desperate for QE from any country that they are deluding themselves ontheslightest whiff.  The market regulator is not initiating QE but thinking of improving market regulation in China and expanding products available to investors there.  No QE.  

Tue, 01/10/2012 - 09:07 | 2049737 RobotTrader
RobotTrader's picture

China, India, and metals on fire this morning.

Looks like another horrific day for short-sellers

Tue, 01/10/2012 - 09:35 | 2049788 LongSoupLine
LongSoupLine's picture

...and a great day for select opportunistic trolls.

Sat, 03/24/2012 - 13:17 | 2286741 l.hauri
l.hauri's picture

It is good for the economical sector. We will see a progress this year. I have some Mediums

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