MORNING BRIEFING: The speech by Ben Bernanke reassures investors, return of risk appetite; US Dollar falls.

[RTFX-Trading]

MORNING BRIEFING: The speech by Ben Bernanke reassures investors, return of risk appetite; US Dollar falls.

What’s new?
United States: The Fed suspends certain emergency measures for injecting liquidity into the market.
Switzerland: UBS is expected to show a net loss in 2nd quarter
United States: Stanford pleads not guilty to fraud charges amounting to $7.5B.
United States: Wall Street up more than 2%, benefitting from new glimmers of hope.
Crude Oil: Price per barrel again above $70.
France: Rise in unemployment slower in May.
United States: GDP shrinks by 5.50% in 1st quarter.
United States: Initial jobless claims increase to 627'000.
Euro zone: Industrial Orders fall by one third over 1 year.

Today:
08h00 Germany: Import Price Index M/M May, exp 0.30%, previous -0.80%
08h00 United Kingdom: Nationwide Home Prices Index June, previous 1.20%.
08h45 France: GDP Q/Q Q1, previous -1.50%.
08h45 France: Consumer Confidence Index June, exp -39, previous -40.
11h30 Switzerland: KOF Leading Indicator June, exp -1.76, previous -1.86.
14h30 United States: Core PCE M/M May, exp 0.10%, previous 0.30%.
14h30 United States: Personal Income May, exp 0.30%, previous 0.50%.
14h30 United States: Personal Spending May, exp 0.30%, previous -0.10%.
15h55 United States: University of Michigan Confidence Index June, exp 69.0, previous 68.7.

Overnight Rates and Indices:
EURUSD:  1.4062 – 1.3983.
USDCHF: 1.0947- 1.0886.
GBPUSD: 1.6444 – 1.6366.
EURJPY: 134.82 – 134.09.
USDJPY: 96.04 – 95.62.
DowJones: 8'472 +2.08%.
NASDAQ: 1’829 +2.08%.
S&P 500: 920 +2.14%.
Nikkei: 9’847 +2.68%.
Gold: $942
Crude Oil: $70.65
 
Comments:

In his testimony, the President of the US Federal Reserve, Ben Bernanke, has reassured the markets on the Bank of America-Merrill Lynch case, and ensured the smooth running of the award of seven-year Treasury. The market also welcomed the role of chairman of the Fed in the takeover of Merrill Lynch by Bank of America, and in a successful auction of $27B Treasury borrowing in seven years. Investors have also welcomed the announcement by the Fed to suspend certain provisions of emergency injection of liquidity.

In response to the rise of Wall Street, the US dollar has lost ground to most other major currencies; the renewed risk appetite for riskier assets deprives it of part of its safe haven status value. The Dollar is currently above 1.4000 against the Euro.
   
Regarding the Swiss franc is also the subject of discussion in the halls of foreign exchange markets, traders are on the lookout for any further intervention by the Swiss National Bank (SNB) or the Bank for International Settlements (BIS) to lower the Franc. However, there is a range of sellers USD/CHF above 1.1000.

Good Day

Emman Xuereb
RTFX Ltd
Head Office

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