Daily Market Review 31/07/2013

World shares and oil have dipped and the dollar held firm in muted trade today, as traders steer clear of big bets ahead of a Federal Reserve meeting and data offering an insight into the health of the U.S. economy. Global growth in the months ahead is pegged to the rate of recovery in the U.S. economy and investors are worried an early withdrawal of support from the U.S. central bank by tapering back in its bond purchases could threaten the outlook.

Ahead of the U.S. Federal Reserve policy statement due at 1800 GMT, the dollar index had inched up 0.1 percent to 81.877. The index had hit a five-week trough earlier this week as investors bet the Fed would reassure markets that interest rates would remain low for a long time even if it started scaling back stimulus this year.

Meetings of other major developed world central banks in coming days, including the European Central Bank on Thursday, and the key U.S. payrolls report on Friday are also prompting investors to tread cautiously

A fall in retail sales in Europe’s fiscal lynchpin, Germany, has added to investor concerns there, leading the broad FTSEurofirst 300 index down 0.3 percent and the euro zone’s blue-chip Euro STOXX 50 index down 0.4 percent in early trade.

German bonds were lower though traders said this was largely due to investors making way for an upcoming sale of new 30-year government bonds. The selling lifted the current German 30-year yield by 2 basis points to 2.5 percent.

Elsewhere in European trade, France’s cash-strapped government may freeze income tax thresholds next year as a way to raise additional revenue. President Francois Hollande’s Socialist government needs to raise an extra 6 billion euros in revenue next year and is seeking the right balance between belt-tightening and tax hikes.

After a sub optimal session for traders in Asia, the MSCI world equity index was down 0.25 percent. Chinese stocks rose 0.5 percent after the government pledged to keep growth stable in the second half of the year.

Crude oil prices eased 0.2 percent to around $106.70 a barrel, extending a 0.6 percent decline on Tuesday but remain up 4.5 percent this month and on course for their best monthly gain since August last year.

Gold gained 0.5 percent. It is up 8.2 percent so far this month, on track to snap a three-month losing run and mark its biggest monthly rise since January 2012, but it is down 20 percent since the beginning of 2013.

Disclaimer: The information in this analysis is collected from different sources and should serve for informative purposes only. The author shall not be held responsible for the validity of the presented information. No part of this analysis recommends the purchase or sale of a currency pair or any other financial instrument.

Economic Events 31/07/2013

06:45 EUR French Consumer Spending (MoM)

Forecast: 0.1%                      Previous: 0.5%

French Consumer Spending measures the change in the inflation-adjusted value of all goods expenditures by consumers. Consumer spending accounts for the majority of economic activity. A higher than expected reading should be taken as positive/bullish for the EUR, while a lower than expected reading should be taken as negative/bearish for the EUR.

07:00 CHF KOF Leading Indicators

Forecast: 1.22                        Previous: 1.16

The KOF Leading Indicators Index is designed to predict the direction of the economy over the following six months. The index is a composite reading of 12 economic indicators related to banking confidence, production, new orders, consumer confidence and housing. A higher than expected reading should be taken as positive/bullish for the CHF, while a lower than expected reading should be taken as negative/bearish for the CHF.

07:55 EUR German Unemployment Change

Forecast:4K                          Previous: 12K

German Unemployment Change measures the change in the number of unemployed  people during the previous month. A higher than expected reading should be taken as negative/bearish for the EUR, while lower than expected reading should be taken as positive/bullish for the EUR.

07:55 EUR German Unemployment Rate

Forecast: 6.8%                      Previous: 6.8%

The German unemployment rate measures the percentage of the total work force that is unemployed  and  actively  seeking  employment  during  the  reported  month.    A  higher  than expected reading should be taken as negative/bearish for the EUR, while a lower than expected reading should be taken as positive/bullish for the EUR.

 

08:00 NOK Norwegian Unemployment Rate

 

Forecast:                                Previous: 3.50%

 

LFS- Labour Force Survey. Three-months moving average. Employed persons are persons aged

16-74 who performed work for pay or profit for at least one hour in the survey week, or who were temporarily absent from work because of illness,holidays etc. Conscripts are classified as employed persons. Persons engaged by government measures to promote employment are also included if they receive wages. Unemployed persons are persons who were not employed in the survey  week,but  who  had  been  seeking  work  during  the  preceding  four  weeks,  and  were available for work within the next two weeks. Persons in the labour force are either employed or unemployed. The remaining group of persons is labelled not in the labour force. Unemployed persons and persons not in the labour force constitute the group non-employed persons. A higher than expected reading should be taken as negative/bearish for the NOK , while a lower than expected reading should be taken as positive/bullish for the NOK.

 

09:00 EUR Unemployment Rate

 

Forecast: 12.2%                    Previous: 12.2%

 

The Unemployment Rate measures the percentage of the total work force that is unemployed and actively seeking employment during the previous month. The data tends to have a muted impact as there are several earlier indicators related to labor conditions in the euro zone. A higher than expected reading should be taken as negative/bearish for the EUR, while a lower than expected reading should be taken as positive/bullish for the EUR.

 

10:00 ILS Israeli Quarterly Unemployment Rate

 

Forecast:                                Previous: 6.5%

 

The Unemployment Rate measures the percentage of the total work force that is unemployed and actively   seeking   employment.   A   higher   than   expected   reading   should   be   taken   as negative/bearish for the ILS , while a lower than expected reading should be taken as positive/bullish for the ILS.

 

12:15 USD ADP Nonfarm Employment Change

 

Forecast: 180K                      Previous: 188K

 

The ADP National Employment Report is a measure of the monthly change in non-farm, private employment, based on the payroll data of approximately 400,000 U.S. business clients. The release, two days ahead of government data, is a good predictor of the government’s non-farm payroll report. The change in this indicator can be very volatile. A higher than expected reading should be taken as positive/bullish for the USD, while a lower than expected reading should be taken as negative/bearish for the USD.

 

12:30 CAD GDP (MoM)

 

Forecast:                                Previous: 0.1%

 

Gross Domestic Product (GDP) measures the annualized change in the inflation-adjusted value of all goods and services produced by the economy. It is the broadest measure of economic activity and the primary indicator of the economy’s health. Canada releases fresh GDP data on a monthly basis. A higher than expected reading should be taken as positive/bullish for the CAD, while a lower than expected reading should be taken as negative/bearish for the CAD.

 

12:30 USD Employment Cost Index (QoQ)

 

Forecast: 0.4%                      Previous: 0.3%

 

The French Manufacturing Purchasing Manager’s Index (PMI) measures the activity level of purchasing managers in the manufacturing sector. A reading above 50 indicates expansion in the sector; a reading below 50 indicates contraction. Traders watch these surveys closely as purchasing managers usually have early access to data about their company’s performance, which can be a leading indicator of overall economic performance. A higher than expected reading should be taken as positive/bullish for the EUR, while a lower than expected reading should be taken as negative/bearish for the EUR.

 

12:30 USD GDP (QoQ)

 

Forecast: 1.0%                      Previous: 1.8%

 

Gross Domestic Product (GDP) measures the annualized change in the inflation-adjusted value of all goods and services produced by the economy. It is the broadest measure of economic activity and the primary indicator of the economy’s health. A higher than expected reading should be taken as positive/bullish for the USD, while a lower than expected reading should be taken as negative/bearish for the USD.

 

12:30 USD GDP Price Index (QoQ)

 

Forecast: 1.1%                      Previous: 1.3%

 

The GDP Price Index measures the annualized change in the price of all goods and services included in gross domestic product.It is the broadest inflationary indicator. A higher than expected reading should be taken as positive/bullish for the USD, while a lower than expected reading should be taken as negative/bearish for the USD.

13:45 USD Chicago PMI

Forecast: 54.0                        Previous: 51.6

The Chicago Purchasing Managers’ Index (PMI) determines the economic health of the manufacturing sector in Chicago region. A reading above 50 indicates expansion of the manufacturing sector; a reading below indicates contraction. The Chicago PMI can be of some help in forecasting the ISM manufacturing PMI. A higher than expected reading should be taken as positive/bullish for the USD, while a lower than expected reading should be taken as negative/bearish for the USD.

23:00 KRW South Korean CPI (YoY)

Forecast: 1.5%                      Previous: 1.0%

The Consumer Price Index (CPI) measures the change in the price of goods and services from the perspective of the consumer. It is a key way to measure changes in purchasing trends and inflation. A higher than expected reading should be taken as positive/bullish for the KRW, while a lower than expected reading should be taken as negative/bearish for the KRW.

23:00 KRW South Korean CPI (MoM)

Forecast: 0.3%                      Previous: 0.1%

The Consumer Price Index (CPI) measures the change in the price of goods and services from the perspective of the consumer. It is a key way to measure changes in purchasing trends and inflation. A higher than expected reading should be taken as positive/bullish for the KRW, while a lower than expected reading should be taken as negative/bearish for the KRW.

Disclaimer: The information in this analysis is collected from different sources and should serve for informative purposes only. The author shall not be held responsible for the validity of the presented information. No part of this analysis recommends the purchase or sale of a currency pair or any other financial instrument.

Economic Events 30/07/2013

01:30 AUD Building Approvals (MoM)

Forecast: 2.3%                      Previous: 1.1%

Building Approvals (also known as Building Permits) measures the change in the number of new building approvals issued by the government. Building permits are key indicator of demand in the housing market.  A higher than expected reading should be taken as positive/bullish for the AUD, while a lower than expected reading should be taken as negative/bearish for the AUD.

05:30 INR Indian Interest Rate Decision

Forecast: 7.30%                    Previous: 7.25%

Monetary policy refers to the actions undertaken by a country’s monetary authority, central bank or government to achieve certain national economic goals. It is based on the relationship between interest rates at which money can be borrowed and total supply of money. Policy rates are the most important rates within a country’s monetary policy. Changing them influences economic growth,inflation, exchange rates and unemployment. A higher than expected reading should be taken as positive/bullish for the INR , while a lower than expected reading should be taken as negative/bearish for the INR.

06:00 EUR GfK German Consumer Climate

Forecast: 6.9                          Previous: 6.8

The Gfk German Consumer Climate Index measures the level of consumer confidence in economic activity. The data is compiled from a survey of about 2,000 consumers which asks respondents to rate the relative level of past and future economic conditions.  A higher than expected reading should be taken as positive/bullish for the EUR,while a lower than expected reading should be taken as negative/bearish for the EUR.

12:00 EUR German CPI (MoM)

Forecast: 0.3%                      Previous: 0.1%

The German Consumer Price Index (CPI) measures the changes in the price of goods and services purchased by consumers. A higher than expected reading should be taken as positive/bullish for the EUR, while a lower than expected reading should be taken as negative/bearish for the EUR.

12:00 EUR German CPI (YoY)

Forecast: 1.7%                      Previous: 1.8%

The German Consumer Price Index (CPI) measures the changes in the price of goods and services purchased by consumers. A higher than expected reading should be taken as positive/bullish for the EUR, while a lower than expected reading should be taken as negative/bearish for the EUR.

14:00 USD CB Consumer Confidence

Forecast: 81.3                        Previous: 81.4

Conference Board (CB) Consumer Confidence measures the level of consumer confidence in economic activity. It is a leading indicator as it can predict consumer spending, which plays a major role in overall economic activity. Higher readings point to higher consumer optimism.  A higher than expected reading should be taken as positive/bullish for the USD, while a lower than expected reading should be taken as negative/bearish for the USD.

14:00 EUR Consumer Confidence

Forecast: 18.3                       Previous: 18.8

Consumer Confidence measures the level of consumer confidence in economic activity. It is a leading indicator as it can predict consumer spending, which plays a major role in overall economic activity. The reading is compiled from a survey of about 2,300 consumers in the euro zone which asks respondents to evaluate future economic prospects. Higher readings point to higher consumer optimism. A higher than expected reading should be taken as positive/bullish for the EUR, while a lower than expected reading should be taken as negative/bearish for the EUR.

Disclaimer: The information in this analysis is collected from different sources and should serve for informative purposes only. The author shall not be held responsible for the validity of the presented information. No part of this analysis recommends the purchase or sale of a currency pair or any other financial instrument.

Daily Market Review 30/07/2013

In currencies today, the US dollar has climbed higher today, recovering from recent falls, on caution that the Federal Reserve may lay the groundwork for curbing stimulus at a policy meeting this week. The dollar index was up 0.1 percent at 81.724, pulling away from Monday’s five-week low of 81.499 and holding above chart support at 81.524, the 200-day moving average.

The dollar has been in a state of downward pressure over the past few weeks, folllowing Federal Reserve Chairman Ben Bernanke’s indications that a highly accommodative monetary policy was still necessary. U.S. monthly jobs figures are due to be released on Friday, and some traders are hoping this month’s results could lead to a stronger dollar.

The Australian dollar slid 1.5 percent today to $0.9064, just above a near three-year low of $0.8998 hit in mid-July.Reserve Bank of Australia Governor Glenn Stevens said the currency could fall further and there was room for more interest rate cuts.

The Swedish crown also lost ground after data showed the Swedish economy unexpectedly contracted by 0.1 percent during the second quarter of the year, helping the euro rise 0.6 percent to 8.6412 crowns.

In Europe, the euro is currently steady at $1.3266, just below Friday’s five-week high of $1.32975, whilt the European Central Bank and the Bank of England are expected to maintain pledges to keep monetary policy loose after policy meetings ending on Thursday. Analysts recommended traders reinitiate short euro/dollar positions, with a target of $1.28 and a stop at $1.3430.

In Asian markets, the US dollar was up 0.3 percent at 98.19 against the Japanese yen in trade today.  Japan’s Nikkei average rebounded from a one-month low today as the yen’s retreat against the dollar drove exporters higher, while a rise in Chinese shares for the first time in five days lifted investor sentiment. The Nikkei Index gained 1.5 percent to 13,869.82 after falling yesterday to the lowest level since June.

Meanwhile, China’s top decision-making body, the politburo, held a meeting on the economic situation in the first half of the year and to discuss key tasks for the second half. . The Chinese economy has slowed in nine of the past 10 quarters, and the meeting is intended to curb this slide, with official data showing economic growth slowed to 7.5 percent in the second quarter from 7.7 percent in the previous quarter

Disclaimer: The information in this analysis is collected from different sources and should serve for informative purposes only. The author shall not be held responsible for the validity of the presented information. No part of this analysis recommends the purchase or sale of a currency pair or any other financial instrument.

Daily Market Review 29/07/2013

Its going to be a big week for traders. In currency markets, the US dollar is on the defensive in Asia today as investors braced for an event-packed week that includes central bank meetings in the United States and Europe, manufacturing data from China, and U.S. growth and jobs figures.

The dollar index was 0.14 percent lower at 81.544 and just above chart support at 81.515, its 200 day moving average. The index shed 1.2 percent last week for its third straight weekly loss

The euro was hovering at $1.3293, just below a five-week peak of $1.3296. Option barriers blocked the way around $1.33 while the next major chart target was the mid-June high of $1.3415.

Traders with an interest in the Euro will be pleased to hear of increased confidence in the currency, with the number of investors who think a country will leave the euro zone soon having dropped by two thirds in the year since the head of the bloc’s central bank promised to safeguard the currency, a survey published today has shown.  A July poll of  investors showed 23.75 percent of participants foresaw at least one state quitting the 17-nation bloc within the next year. That survey coincided with the pledge by European Central Bank President Mario Draghi to do “whatever it takes” to save the euro. Last July’s euro break-up index reading was 73 percent.

In Asia, Japan’s most significant fiscal reform in years, a planned increase in the country’s sales tax, could be delayed or watered down in a move that might rattle financial markets and ultimately undermine support for the prime minister.

Despite holding the strongest political mandate of any prime minister in years, there are signs that Shinzo Abe is seriously rethinking the plan out of concern it could derail the economic recovery he has crafted with an aggressive policy mix, which is being dubbed ‘Abenomics’ in some circles. In the latest indication, according to Japanes government sources, Abe has ordered a study of alternatives for implementing the sales tax increases, including introducing them more gradually.

Meanwhile, Copper has fallen to its lowest level in nearly three weeks today owing to uncertainty about growth in top consumer China weighing on the outlook for metals demand, but further falls have been capped by a weakened dollar. Three-month copper on the London Metal Exchange fell to its lowest level since early July at $6,820 a tonne in intraday trade today, later rebounding to $6,853 a tonne at 0935 GMT, down from a last bid of $6,860 on Friday. Despite this, the metal is headed for a small monthly gain of 1.7 percent for July following losses of nearly 8 percent in June.

Disclaimer: The information in this analysis is collected from different sources and should serve for informative purposes only. The author shall not be held responsible for the validity of the presented information. No part of this analysis recommends the purchase or sale of a currency pair or any other financial instrument.

Economic Events 29/07/2013

10:00 GBP CBI Distributive Trades Survey

Forecast: 10                           Previous: 1

The Confederation of British Industry (CBI) Distributive Trades Survey (DTS) measures the health of the retail sector. The reading is compiled from a survey covering 20,000 firms responsible for 40% of employment in retailing. It includes measures of sales activity across the distributive trades. It is a leading indicator of consumer spending. The figure is the difference between the percentage of retailers reporting an increase in sales and those reporting a decrease. A higher than expected reading should be taken as positive/bullish for the GBP, while a lower than expected reading should be taken as negative/bearish for the GBP.

14:00 USD Pending Home Sales (MoM)

Forecast: 1.00%                   Previous: 6.7%

The National Association of Realtors (NAR) Pending Home Sales Report measures the change in the number of homes under contract to be sold but still awaiting the closing transaction, excluding new construction. A higher than expected reading should be taken as positive/bullish for the USD, while a lower than expected reading should be taken as negative/bearish for the USD.

14:30 ILS Israeli Interest Rate Decision

Forecast: 1.25%                    Previous: 1.25%

The Bank of Israel’s “headline” rate of interest is the rate of interest announced by the Governor at the end of every liquidity month. These announcements have been made since the end of 1993, and provide the commercial banks with a benchmark for their rates on local currency unindexed deposits and credit. A higher than expected reading should be taken as positive/bullish for the ILS , while a lower than expected reading should be taken as negative/bearish for the ILS

22:45 NZD Building Consents (MoM)

Forecast:                                Previous: 1.3%

Building Consents (also known as Building Permits) measures the change in the number of new building consents issued by the government. Building consents are a key indicator of demand in the housing market. A higher than expected reading should be taken as positive/bullish for the NZD, while a lower than expected reading should be taken as negative/bearish for the NZD.

23:00 KRW South Korean Industrial Production (YoY)

Forecast: 1.0%                     Previous: 1.4%

Industrial  Production  measures  the  change  in  the  total  inflation-adjusted  value  of  output produced by manufacturers, mines, and utilities. A higher than expected reading should be taken as positive/bullish for the KRW, while a lower than expected reading should be taken as negative/bearish for the KRW.

23:00 KRW South Korean Industrial Production (MoM)

Forecast: 0.4%                      Previous: 0.4%

Industrial  Production  measures  the  change  in  the  total  inflation-adjusted  value  of  output produced by manufacturers, mines, and utilities. A higher than expected reading should be taken as positive/bullish for the KRW, while a lower than expected reading should be taken as negative/bearish for the KRW.

Disclaimer: The information in this analysis is collected from different sources and should serve for informative purposes only. The author shall not be held responsible for the validity of the presented information. No part of this analysis recommends the purchase or sale of a currency pair or any other financial instrument.

Economic Events 26/07/2013

06:00 EUR German Import Price Index (MoM)

Forecast: 0.3%                                 Previous: 0.4%

The German Import Price Index measures the change in the price of imported goods purchased domestically. A higher than expected reading should be taken as positive/bullish for the EUR, while a lower than expected reading should be taken as negative/bearish for the EUR.

06:45 EUR French Consumer Confidence

Forecast: 79                           Previous: 78

French Consumer Confidence measures the level of consumer confidence in economic activity. It is a leading indicator as it can predict consumer spending, which plays a major role in overall economic activity. Higher readings point to higher consumer optimism. A higher than expected reading should be taken as positive/bullish for the EUR, while a lower than expected reading should be taken as negative/bearish for the EUR.

13:30 BRL Brazilian Bank lending (MoM)

Forecast:                                Previous: 1.50%

Bank Lending measures the change in the total value of outstanding bank loans issued to consumers and businesses. Borrowing and spending are closely correlated with consumer confidence. A higher than expected reading should be taken as positive/bullish for the BRL , while a lower than expected reading should be taken as negative/bearish for the BRL.

13:55 US Michigan Consumer Sentiment

Forecast: 84.0                        Previous: 83.9

The University of Michigan Consumer Sentiment Index rates the relative level of current and future economic conditions. There are two versions of this data released two weeks apart, preliminary and revised. The preliminary data tends to have a greater impact. The reading is compiled from a survey of around 500 consumers. A higher than expected reading should be taken as positive/bullish for the USD, while a lower than expected reading should be taken as negative/bearish for the USD.

13:55 US Michigan Inflation Expectations

Forecast:                                Previous: 3.3%

University of Michigan (UoM) Inflation Expectations measures the percentage that consumers expect the price of goods and services to change during the next 12 months. There are two versions of this data released two weeks apart,Preliminary and Revised. The preliminary release is the earliest so tends to have more impact. A higher than expected reading should be taken as positive/bullish for the USD, while a lower than expected reading should be taken as negative/bearish for the USD.

14:30 US ECRI Weekly Annualized (WoW)

Forecast:                                Previous: 4.50%

Weekly Leading Index is the measure of future Economic growth which is annualised growth rate. A higher than expected reading should be taken as positive/bullish for the USD , while a lower than expected reading should be taken as negative/bearish for the USD.

Disclaimer: The information in this analysis is collected from different sources and should serve for informative purposes only. The author shall not be held responsible for the validity of the presented information. No part of this analysis recommends the purchase or sale of a currency pair or any other financial instrument.

Daily Market Review 26/07/2013

The US dollar has fallen to a five-week low against a number of major currencies as tensions mount regarding Federal Reserve Policy. Traders are waiting to see whetherthe possibility of the Federal Reserve delivering a downbeat message after its policy meeting next week will eventuate.

Investors have said that a Wall Street Journal report indicating the US central bank may debate changing its forward guidance to emphasize that it will keep rates low for a long time prompted investors to curb their strategies in an effort to avoid reliance on the dollar gaining.

These latest falls have caused the dollar to resume a slide which began on July 10, when minutes of the Fed’s June meeting gave investors second thoughts about when the bank would start reducing stimulus.

In Asia today, Japan’s consumer prices rose in June for the first time in more than a year, a positive sign for the government’s battle against deflation, but the rises centered on higher electricity bills rather than stronger demand that could drive a durable and sustainable recovery.

Todays’s figures showing the fastest price rise in nearly five years bodes well for the central bank’s bold stimulus plan to achieve 2 percent inflation in two years, however analysts warn that this target remains a tall order unless companies start to raise wages enough to make up for an expected tax increase due next year.

Core consumer prices rose 0.4 percent in June from a year earlier, higher than a median market forecast for a 0.3 percent increase, largely due to higher electricity bills and gasoline prices.

Meanwhile, the Nikkei slid 3 percent to a near three-week low in today’s trade, with blue-chip exporters and financials leading declines on the back of the stronger yen and profit-taking.

The Nikkei closed down 432.95 points at 14,129.98 after dropping as low as 14,114.52 in earlier trade, its lowest level since July 8. The benchmark shed 3.2 percent on the week, breaking the stride of a strong five-week run.

In other currency news, the Indian rupee rose to a five-week high today as the central bank’s aggressive defense of the currency showed some signs of success, with traders again set to demand the government pay them generously to buy its bonds at auction.

The central bank has tightened money supply and pushed up short-term interest rates to try to generate demand for the rupee, which hit a record low on July 8, but that has forced the government to pay abnormally high yields to sell its debt — including 11 percent on three-month paper earlier this week.

In a move sure to improve trader morale in Europe, Officials working for euro zone finance ministers signed off on the payment of the next batch of aid for Greece today, with money due to be  disbursed on the approval of member states on Monday, euro zone officials said.

Greece adopted the last piece of legislation international lenders required to unlock 5.8 billion euros of aid from the euro area, its national central banks and the International Monetary Fund yesterday.

Disclaimer: The information in this analysis is collected from different sources and should serve for informative purposes only. The author shall not be held responsible for the validity of the presented information. No part of this analysis recommends the purchase or sale of a currency pair or any other financial instrument.

Daily Market Review 25/07/2013

European assets were flat in early trading today as traders elected to tread carefully prior to the release of German and British data expected to add weight to signs the continent’s economy is reviving.

The German IFO survey due to be released today was expected to show business morale picked up for a third consecutive month in July, while the first reading for Britain’s second quarter GDP is tipped to show growth to have doubled from the first quarter.

Better reports on business activity for the United States and Europe yesteday are believed to have encouraged traders to reduce holdings of safe U.S. and German government debt, and helped to prop up share prices. This is despite further evidence of a slowdown in China.

European stock market investors were also closely watching company results and outlooks before deciding on whether to push prices higher.

The earnings season has now commenced in major financial centers, keeping markets in check as investors attempt to pre-empt varying business outlooks amid challenging global growth prospects. So far, according to traders in Europe, the situation has been hard to gauge.

Despite the lack of certainty in the broader European market, rreliminary data from the UK’s Office for National Statistics showed gross domestic product rose 0.6 percent in the April-to-June period compared with the previous quarter. Britain’s economic growth in the second quarter of 2013 has been stronger than the government forecast and shows the economy is now beginning to recover.

MSCI’s broadest index of Asia-Pacific shares outside Japan are down 0.3 percent after having posted a seven-week closing high a day earlier, while the the U.S. S&P 500 index shed 0.4 percent, a modest move and yet still the biggest fall in almost a month.

The euro has made a minor push up 0.1 percent to about $1.3214 while Europe’s broad FTSE Eurofirst 300 index saw almost no change at the open of the market, whilst Bund futures dipped slightly.

The US dollar struggled to extend gains after snapping a three-day slide,  The dollar has now eased versus most currencies today but stayed above a recent one-month low after a rise in domestic bond yields reminded investors that the Federal Reserve was still closer to tempering its monetary stimulus than other major central banks.

Against the yen, the US dollar slipped 0.2 percent to about 100.09 yen but still held on to most of the gains made on Wednesday, when the greenback firmed 0.8 percent versus the Japanese currency.

Elsewhere, the New Zealand dollar held steady at $0.7980, up from Wednesday’s intraday low of $0.7906.  Australia’s central bank is still thought likely to cut rates again, and perhaps as early as August given a subdued economy and benign inflation. As a result, the AUD has slid to its lowest since late 2008 against its New Zealand counterpart at NZ$1.1453.

Commodities are under pressure for the most part today given ongoing concerns amongst traders about a slowdown in China, with copper falling 0.4 percent to $7,023 a ton and oil slipping 0.4 percent to $105 a barrel, while gold found a tentative footing following a 2 percent fall.

Disclaimer: The information in this analysis is collected from different sources and should serve for informative purposes only. The author shall not be held responsible for the validity of the presented information. No part of this analysis recommends the purchase or sale of a currency pair or any other financial instrument.

Economic Events 25/07/2013

08:00 EUR German Business Expectations

Forecast: 102.5 Previous: 102.5

German Business Expectations rates the expectations of businesses in Germany for the following six months. It is is a sub-index of the German Ifo Business Climate Index. A higher than expected reading should be taken as positive/bullish for the EUR, while a lower than expected reading should be taken as negative/bearish for the EUR.

08:00 EUR German Current Assessment

Forecast: 109.7 Previous: 109.4

The German Current Assessment rates current business conditions in Germany, without considering future expectations. It is a sub-index of the German Ifo Business Climate Index. A higher than expected reading should be taken as positive/bullish for the EUR, while a lower than expected reading should be taken as negative/bearish for the EUR.

08:00 EUR German Ifo Business Climate Index

Forecast: 106.1 Previous: 105.9

The German Ifo Business Climate Index rates the current German business climate and measures expectations for the next six months. It is a composite index based on a survey of manufacturers, builders, wholesalers and retailers. The index is compiled by the Ifo Institute for Economic Research. A higher than expected reading should be taken as positive/bullish for the EUR, while a lower than expected reading should be taken as negative/bearish for the EUR.

08:30 GBP GDP (YoY)

Forecast: 1.4% Previous: 0.3%

Gross Domestic Product (GDP) measures the annualized change in the inflation-adjusted value of all goods and services produced by the economy. It is the broadest measure of economic activity and the primary indicator of the economy’s health. A higher than expected reading should be taken as positive/bullish for the GBP, while a lower than expected reading should be taken as negative/bearish for the GBP.

08:30 GBP GDP (QoQ)

Forecast: 0.6% Previous: 0.3%

Gross Domestic Product (GDP) measures the annualized change in the inflation-adjusted value of all goods and services produced by the economy. It is the broadest measure of economic activity and the primary indicator of the economy’s health. A higher than expected reading should be taken as positive/bullish for the GBP, while a lower than expected reading should be taken as negative/bearish for the GBP.

12:00 BRL Brazilian Unemployment Rate

Forecast: Previous: 5.8%

The Unemployment Rate measures the percentage of the total work force that is unemployed and actively seeking employment. A higher than expected reading should be taken as negative/bearish for the BRL, while a lower than expected reading should be taken as positive/bullish for the BRL.

12:30 US Continuing Jobless Claims

Forecast: 3,000K Previous: 3,114K

Continuing Jobless Claims measures the number of unemployed individuals who qualify for benefits under unemployment insurance. A higher than expected reading should be taken as negative/bearish for the USD, while a lower than expected reading should be taken as positive/bullish for the USD.

12:30 US Core Durable Goods Orders (MoM)

Forecast: 0.5% Previous: 0.5%

Core Durable Goods Orders measures the change in the total value of new orders for long lasting manufactured goods, excluding transportation items. Because aircraft orders are very volatile, the core number gives a better gauge of ordering trends. A higher reading indicates increased manufacturing activity. A higher than expected reading should be taken as positive/bullish for the USD, while a lower than expected reading should be taken as negative/bearish for the USD.

12:30 US Durable Goods Orders (MoM)

Forecast: 1.2% Previous: 3.7%

Durable Goods Orders measures the change in the total value of new orders for long lasting manufactured goods, including transportation items. A higher than expected reading should be taken as positive/bullish for the USD, while a lower than expected reading should be taken as negative/bearish for the USD.

12:30 US Initial Jobless Claims

Forecast: 340K Previous: 334K

Initial Jobless Claims measures the number of individuals who filed for unemployment insurance for the first time during the past week. This is the earliest U.S. economic data, but the market impact varies from week to week. A higher than expected reading should be taken as negative/bearish for the USD, while a lower than expected reading should be taken as positive/bullish for the USD.

23:00 KRW South Korean GDP (YoY)

Forecast: Previous: 1.5%

Gross Domestic Product (GDP) measures the annualized change in the inflation-adjusted value of all goods and services produced by the economy. It is the broadest measure of economic activity and the primary indicator of the economy’s health. A higher than expected reading should be taken as positive/bullish for the KRW, while a lower than expected reading should be taken as negative/bearish for the KRW.

23:00 KRW South Korean GDP (QoQ)

Forecast: Previous: 0.8%

Gross Domestic Product (GDP) measures the annualized change in the inflation-adjusted value of all goods and services produced by the economy. It is the broadest measure of economic activity and the primary indicator of the economy’s health. A higher than expected reading should be taken as positive/bullish for the KRW, while a lower than expected reading should be taken as negative/bearish for the KRW.

23:00 JPY Tokyo Core CPI (YoY)

Forecast: 0.3% Previous: 0.2%

The Tokyo Core Consumer Price Index (CPI) measures the change in the price of goods and services purchased by consumers in Tokyo, excluding fresh food. A higher than expected reading should be taken as positive/bullish for the JPY, while a lower than expected reading should be taken as negative/bearish for the JPY.

Disclaimer: The information in this analysis is collected from different sources and should serve for informative purposes only. The author shall not be held responsible for the validity of the presented information. No part of this analysis recommends the purchase or sale of a currency pair or any other financial instrument.