Wednesday, September 10, 2008
World Daily Markets Briefing
| by: ADVFN Newsdesk Wall St. slips on energy drag, profit-taking NEW YORK - U.S. stocks slipped at the open on Tuesday as weaker oil prices dragged down energy shares and a bout of profit-taking hit financials after Monday's surge. U.S. crude futures were down more than $2 a barrel at $104.02 on dollar strength and fading concerns about Hurricane Ike's threat to facilities in the Gulf of Mexico. Investors braced for data on July pending home sales at 10 a.m. (1400 GMT). The Dow Jones industrial average was down 42.02 points, or 0.37 percent, at 11,468.72. The Standard & Poor's 500 Index was down 8.64 points, or 0.68 percent, at 1,259.15. The Nasdaq Composite Index was down 3.38 points, or 0.15 percent, at 2,266.38. U.S. house prices rose a 2nd month in July - IAS index NEW YORK - U.S. house prices rose for a second month in July, supported by increases in all regions except the western states, a residential property valuation firm said on Tuesday. Prices rose 0.9 percent in the month, following a 1.1 percent rise in June, the IAS360 House Price Index showed. The index declined 11.4 percent in July from a year earlier, however, little changed from the annual drop seen in June. Midwestern home prices increased 3.1 percent in the month, cutting the year-over-year drop to 0.4 percent, the index showed. Prices in the Northeast and South rose 1.6 percent and 1.7 percent, respectively, while those in the West eroded by 0.7 percent, it said. The index is compiled by Denver-based Integrated Asset Services, which specializes in property valuation for the sales of bank-owned real estate. It tracks the monthly change in the median sales price of single-family homes. Forex FOREX-Dollar retreats from 1-yr high, rally to resume LONDON - The dollar fell on Tuesday, pulling away from a one-year high hit earlier in the day against a basket of currencies, although analysts reckoned the move would be just a blip in its climb higher. The dollar's broad rally sputtered as traders locked in profits after huge gains spurred on Monday by the U.S. government's move to salvage top mortgage agencies Fannie Mae and Freddie Mac. "We're seeing some profit taking in the dollar after recent moves," said Kamal Sharma, currency strategist at JPMorgan Chase bank. "But we're still in an environment where we've had the first big move in market positioning from dollar shorts to dollar longs ... that's likely to remain the dominant theme in the next few weeks or so." The dollar has rallied on the view that other countries will track U.S. economic weakness, and a souring global growth outlook continues to favour the dollar, other analysts said. The dollar fell 0.3 percent to 79.258 against its basket after jumping as far as 79.776, its highest in a year, earlier in the global session. The euro rallied nearly half a percent to $1.4200 by 1058 GMT, pulling back from an 11-month low of $1.4049 hit earlier. A retreat in U.S. crude oil prices to around $105 a barrel did little to help the dollar during the European session, with the U.S. currency sliding nearly a third of a percent to 108.00 yen. Still, analysts said the dollar would soon resume the climb which has already driven euro/dollar down 3.5 percent so far this month. "A large chunk of the dollar's rally has been driven by a relative growth shift in the global economy, with the United States relatively stable at a soft level while the rest of the world has been going down," Credit Suisse FX strategist Martin McMahon said. The euro rose 0.3 percent to 153.25 yen, recovering from earlier losses as a 1.2 percent rise in European shares helped to warm some demand for riskier trades involving selling the yen for assets in higher-yielding currencies. The yen pulled back from a broad rally against higher-yielding currencies since July as a wave of risk aversion has prompted investors to unwind carry trades. But analysts expect the yen to keep gaining on the view that the U.S. Treasury's conservatorship of Freddie Mac and Fannie Mae, while addressing some of the systemic risk stemming from the now year-long credit crisis, will not solve the problems afflicting the financial markets. UBS strategists said while U.S. financial problems were far from over, with the Treasury having been forced into action on the mortgage agencies and unemployment jumping above 6 percent, the dollar's resilience had led it to revise up its forecasts. "We have revised our long term targets for the USD higher across the board as America's economy is likely to come out of recession faster than the rest of the world. We now look for the euro to fall to $1.30 over the next year," UBS said in a note to clients. Labels: ADVFN NewsDesk, Forex Analysis |
posted by Matbank at 12:52 AM
