Thursday, September 4, 2008
World Daily Markets Briefing
| FOREX - Dollar steady vs euro as traders await Trichet LONDON - The dollar was mostly flat against major currencies on Thursday as dealers digested interest rate decisions in Europe and keenly awaited a steer from European Central Bank President Jean-Claude Trichet. The European Central Bank and Bank of England left rates steady at 4.25 percent and 5 percent, respectively, decisions that came as little surprise to market participants although a reasonable minority had positioned for a BoE cut. The focus for investors now is very much on Trichet's press conference at 1230 GMT. They will be looking for clues on how the confluence of slowing growth, above-target inflation, sliding commodity prices and a falling euro will influence policy in the coming months. The ECB is expected to issue a new set of economic projections while rejigging collateral rules. Analysts expect Trichet will hold fast to his long-held position that inflation risks will keep high the need for tight policy, even as he acknowledges that the euro zone economy is slowing. "We don't expect Trichet to sound dovish despite the (recent) falling oil price and declining inflation across Europe. So the net impact will be positive for the euro," said Roberto Mialich, currency strategist at Unicredit in Milan. "The risk is for mild short covering for the euro, unless Trichet sounds extremely dovish. The market is still euro negative ... but for the time being we should see some consolidation," particularly ahead of Friday's August U.S. employment report. At 1210 GMT the euro was largely steady on the day against the dollar at $1.4475, pulling back up from $1.4384 hit the previous day for the first time since January. The dollar was flat against the yen at 108.35 yen. The dollar index was also little changed on the day at 78.11, in part kept in check by a 0.4 percent rise in oil prices, which were recovering from a roughly 9 percent fall so far this week. Sterling rose 0.4 percent to $1.7820, benefitting from a 'relief rally' after the BoE decision. The euro was down 0.5 percent at 81.23 pence US STOCKS-Jobless claims push futures further down NEW YORK - U.S. stocks fell at the open on Thursday as weak U.S. labor market data sparked concern about the profit outlook and sent the Dow industrials down 1 percent. A government report showed an unexpected jump in the number of people filing for jobless benefits in the recent week, while a report by ADP Employer Services showed that U.S. private employers cut 33,000 jobs in August. The Dow Jones industrial average was down 116.26 points, or 1.01 percent, at 11,416.62. The Standard & Poor's 500 Index was down 9.51 points, or 0.75 percent, at 1,265.47. The Nasdaq Composite Index was down 21.76 points, or 0.93 percent, at 2,311.97 US weekly jobless claims rise 15,000 to 444,000; cont. claims at over 4 yr high The number of individuals filing new claims for unemployment insurance rose unexpectedly in the latest week, while the number of individuals continuing to file claims for unemployment rose to a level not seen in over four years, the Labor Department said Thursday. The number of first-time claims filed in the week ending August 30 rose 15,000 to 444,000, matching the level reached during the week of August 9. Economists polled by Thomson Reuters IFR Markets were expecting claims to fall for the fourth consecutive week to 420,000. The four-week moving average for initial claims fell by 3,250 to 438,000. Economists prefer the four week moving average because it smoothes out fluctuations in weekly data. Meanwhile, the number of people continuing to receive unemployment insurance in the week ending August 23 rose by 6,000 to 3.435 mln, the highest level since November 2003. Economists were expecting continuing claims to rise to 3.425 mln. The four-week moving average for continuing unemployment claims increased by 33,250 to 3.4 mln, the highest level since November 2003. Labels: ADVFN NewsDesk |
posted by Matbank at 4:07 PM
