TradeTheNews.com Europeu Market Update: G8 começa cúpula de dois dias

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Share This Story: | | Email Thursday, May 26, 2011 5:59:11 AM

 TradeTheNews.com European Market Update: G8 begins two-day summit

***Economic Data***
- (FI) Finland Apr Preliminary Retail Sales Volume Y/Y: 4.8% v 1.4% prior
- (GE) Germany Apr Import Price Index M/M: 0.3% v 0.7%e; Y/Y: 9.4% v 9.9%e
- (SZ) Swiss Apr Trade Balance (CHF): 1.5B v 1.0B prior; Exports M/M: +7.9% v -3.1% prior; Imports M/M: 4.0% v 1.8% prior
- (IN) India Primary Articles w/e May 14th WPI Y/Y: 11.6 v 10.9% prior; Food Articles WPI Y/Y: 8.6 v 7.5% prior
- (FR) France May Consumer Confidence: 84 v 84e
- (RU) Russia Gold & Forex Reserve w/e May 20th: $516.8B v $514.4B prior
- (SW) Sweden May Consumer Confidence: 17.9 v 17.3e; Manufacturing Confidence:11 v 8e; Economic Tendency Survey: 112.4 109.5e
- (SW) Sweden Apr Household Lending Y/Y: 7.2% v 7.3% prior
- (SW) Sweden Apr PPI M/M: 0.0% v 0.4%e; Y/Y: 1.9% v 2.2%e
- (SW) Sweden Apr Trade Balance (SEK): 5.8B v 9.5Be
- (IT) Italy May Business Confidence: 101.3 v 102.7e
- (NO) Norway Mar AKU Unemployment Rate: 3.3% v 3.1%e
- (HK) Hong Kong Apr Trade Balance (HKD): -42.4B v -35.5Be; Exports Y/Y: 4.1% v 18.0%e; Imports Y/Y: 6.1% v 16.3%e
- (SA) South Africa Apr PPI M/M: 0.9% v 1.2%e; Y/Y: 6.6% v 7.0%e

Fixed Income
- (IT) Italy Debt Agency (Tesoro) sold €8.0B vs. €8.0Be in 6-month Bills; Avg Yield 1.657% v 1.659% prior; Bid-to-cover: 1.70 v 1.43x prior
- (HU) Hungary Debt Agency (AKK) sold HUF60B in 12-Month Bills; Avg Yield 5.93% v 5.94% prior
- (HU) Hungary Debt Agency (AKK) sold HUF7.5B in in Dec 2015 floating-rate notes

*** SPEAKERS/FIXED INCOME/FX/COMMODITIES/ERRATUM ***
***Notes/Observations:
- China will support EU bailout bonds
- G8 begins two-day summit in Deauville

Equities:
FTSE 100 +0.30% at 5887, DAX -0.50% at 7138, CAC 40 -0.10% at 3925, IBEX 35 +0.50% at 10263, FTSE MIB +0.10% at 20832, SMI +0.10% at 6469

- European shares edged higher during the session sustained by rising commodities prices. Traders are looking ahead to US GDP data expected in the NY morning which should show an expansion of the US economy. Although, US durable goods came lower than estimates the decrease was expected and Wall Street had a strong finish which helped the EU rally.
In corporate earnings, Man Group [EMG.UK] rose about 2% despite reporting a decrease in the annual profit. However, the asset under management had increased. Burberry [BRBY.UK] reported an increase in pretax profit and revenue. Company said that it expected a modest improvement in operating margin which will be lower in H2 than in last year's period. Shares fell about 3% on profit taking.

Speakers:
- Netherlands Fin Min de Jager: Draghi as head of ECB could possibly cause internal imbalances, The minister added that Greece politicians must approve reform or would not receive any further Dutch aid. A debt restructuring was an option for the country if its debt load proved unsustainable.
- NYU economist Roubini commented that Greece would not default on its debt any restructuring was viewed as both necessary and inevitable. Italy and Spain spreads were not due to Greece's situation as he saw limited risk from any Greek contagion
- Russia Central Bank Gov Ignateyv commented that there has been no decision yet on any widening of RUB currency trading band. He expressed satisfaction with RUB currency volatility and would allow more fluctuations over time. No decision yet on next monetary policy move but could leave interest rates unchanged or even raise them again.
- ECB chief Trichet reiterated his view that central bank was "carefully monitoring" price pressures and added that more needed to be done to deal with crisis. Must avoid rising commodity prices having second round effects and the ECB would do whatever was necessary to fulfill itsmandate of price stability. With economic recovery more firmly established there has been an emergence of upside risks to inflation outlook.
- EU President Van Rompuy stated that the G8 would discuss the global economy and the Middle East this week. He also noted that US President Obama would update G8 on its plans to curb US deficits
- EFSF chief exec Regling: Risk of contagion contained
- Eurocontrol provided update on the ash cloud and noted that there was limited areas of ash cloud in Europe with no air space closure at the moment. It forecasted little to no impact for the next 48 hours

Currencies/Fixed income:
- The EUR/USD started the session on a firm note and continued its short covering rally into the European morning following supportive comments from a PBoC researcher coupled with an FT article that China had interest at next month's Portugal bailout auction. A degree of risk appetite was complemented by rising commodity prices in Asia and some tightening in euro-area peripheral spreads. However, the USD fought back from its lows aided by volatility in the precious metals . Spot silver fell over $2/oz during the morning to test $36.23 before rebounding. The EUR/USD drifted from its opening levels near 1.42 to test 1.4150 ahead of the NY morning. The components of the Hong Kong trade balance was not reflective of the risk appetite that was exhibited during the Asian session today. Comments from Netherlands Fin Min de Jager on Greece were not the most positive in resolving the debt crisis.

Political/ In the Papers:
- Following his comments in an interview with the Guardian, the British Business Secretary Cable continued to warn about the British recovery. Cable said that 'hydrogen bombs' in the economy could move the country into a new economic disaster. His comments were seen as more negative than the views of Chancellor of the Exchequer Osborne.
- The Financial Times reported that higher levels of inflation in Britain could move the economy closer to recession, as higher prices could have a negative impact on consumption. According to revised first quarter GDP data, household spending declined by 0.6%, which was the biggest decline since the second quarter of 2009. Citing an HSBC economist, the evidence that households were retrenching put the UK consumer technically back in recession. JP Morgan estimated that spending by households and firms has contracted for about six months.
- The Chief of the European Financial Stability Facility (EFSF) Regling said that the Chinese government represents a 'strong proportion' of buyers in Portuguese bail-out bonds according to an article in the Financial Times. The report also noted that the EFSF CFO confirmed China participated in Ireland debt offering back in January.
- The European air traffic management body, Eurocontrol, provided an update to the volcanic ash cloud situation in European airspace. The situation continued to improve with only limited areas affected by ash clouds, and no airspace closure. The organization forecasted little to no impact on air traffic for the next 48 hours.

***Looking Ahead***
- 6:00 (CZ) Czech Republic to sell CZK8.0B in 12-month Bills
- 7:00 (BR) Brazil Apr FGV Construction Costs M/M: 1.9%e v 0.8% prior
- 8:00 (EU) ECB's Bini Smaghi speaks
- 8:00 (BR) Brazil Apr Unemployment Rate: 6.4%e v 6.5% prior
- 8:30 (US) Q1 Preliminary GDP Q/Q Annualized: 2.2%e v 1.8% advanced; Personal Consumption: 2.8%e v 2.7% advanced
- 8:30 (US) Q1 Preliminary GDP Price Index: 1.9%e v 1.9% advanced; Core PCE Q/Q: 1.5%e v 1.5% advanced
- 8:30 (US) Initial Jobless Claims: 404Ke v 409K prior; Continuing Claims: 3.70Me v 3.711M prior
- 9:00 (MX) Mexico Q1 GDP: 8.8%e v 9.5% prior-
- 9:00 (MX) Mexico Apr Unemployment Rate: 4.9%e v 4.6% prior
- 10:30 (US) EIA Natural Gas Inventories
- 11:00 (US) Fed to purchase $5-7B in Notes/Bonds
- 13:00 (US) Treasury to sell $29B in 7-Year Notes
- 16:00 (US) Mar RPX Composite 28dayy Y/Y: No est v 4.3% prior; RPX Composite 28dayy Index: No est v 178.63 prior

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