Thursday, June 19, 2014

EVENTS & FINANCIAL NEWS 19-06-2014

Market Comment

US indices gained on Wednesday helped by shares in the Utilities, Transportation and Food & Staples Retailing sectors. The Fed announced that it would continue to taper by slowing the pace of purchases by $10B. The pace of treasury purchases will be $20B ($25B prior), the pace of MBS purchases will be $15B ($20B prior), the Federal Funds Target Rate remains at 0.25% (0.25% expected). The S&P 500 (1956.98) remains above its 20d moving average (1928.1 - positive slope) and its 50d moving average (1893.5 - positive slope).

European markets are expected to start on a positive note.

Foreign Exchange

The US Dollar was under pressure against most of its counterparts on Wednesday. On the US economic data front,MBA Mortgage applications were -9.2% for the week of June 13 (+10.3% the prior week). The Current Account Balance was below expectations at -$111.2B (-$97B expected) for Q1. The Fed announced that it would continue to taper by slowing the pace of purchases by $10B. The pace of treasury purchases will be $20B ($25B prior), the pace of MBS purchases will be $15B ($20B prior), the Federal Funds Target Rate remains at 0.25% (0.25% expected).

The Euro gained against most of its counterparts. In the Eurozone, construction output rose by 0.8 percent in April from March, when it was down 0.3 percent. Minutes of the BOE meeting said "the relatively low probability attached to a bank rate increase this year implied by some financial market prices was somewhat surprising".

The Australian Dollar rose against all of its major counterparts.

Commodities

After the close of Wall Street, WTI Crude Future (JUL 14) was about flat to $106.18. The contract was above its 20D MA (@ $101) and above its 50D MA (@ $100.35). The US Department of Energy reported that, for the week ended 13 June, crude oil inventories fell 579k barrels compared to the previous week.

Gold was up $3.9 to $1274.5. The precious metal was above its 20D MA (@ $1264) and below its 50D MA (@ $1284).

Copper Future (SEP 14) on Comex was about flat to 306.4c/lb. The contract was below its 20D MA (@ 307.41c) and above its 50D MA (@ 303.17c). In Europe, the London Metal Exchange reported its copper inventories decreased 525 tons to 160675 tons.

European Markets

ECB: ECB Public Holiday - Corpus Christi; Participation by the President and Mr. Coeuré in the Eurogroup meeting in Luxembourg.

Today's Economic Events

UK 09:30: MAY Retail Sales (MoM): -0.6%
US 13:30: W23 Initial Jobless Claims (Thsd): 312
US 15:00: JUN Philadelphia Fed.: 14
US 15:00: MAY Leading Indicators: 0.6%

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