MORNING BRIEFING : The markets are waiting for the ECB’s meeting on Thursday

[RTFX-Trading]

MORNING BRIEFING :  The markets are waiting for the ECB’s meeting on Thursday

What’s new :
United States: second consecutive session of increases on Wall Street
United States: More efforts to reduce the budget deficit to keep the AAA rating from Moody's
China: First rise in mortgage interest
Europe: Greece pledges to reduce to 3% deficit by 2012
Europe: Meeting Thursday of the ECB (European Central Bank)
France: France seeks a balanced budget in 2020 said Mr Fillon

Today:


Rates in Asia and Indices:
EURUSD: 1.3989– 1.3946.
USDCHF: 1.0568– 1.0537.
GBPUSD: 1.6046 – 1.5964.
EURJPY: 126.53 – 125.97.
USDJPY: 90.55 – 90.30.
Dow Jones: 10'296 +1.09%.
NASDAQ: 2’190 +0.87%.
S & P 500: 1'103 +1.30%.
Nikkei: 10'404 +0.32%.
Shanghai: 2’980 +1.56%.
Or: 1'122.49$.
Pétrole brut: 75.94$.

Comments:

For the second consecutive day, the stock market on Wall Street is experiencing a sharp rise, supported among others by a statistic suggesting an improvement in the housing market. But markets await key employment figures, released Friday, before taking a clearer position on the USD.
The Obama administration will have to make more effort to reduce the budget deficit , if the United States want to retain their AAA rating, Moody's warned.
In China, first sign of the Central Bank’s intention to slow overheating in the real estate, discount mortgage rates have been suppressed and a major Chinese bank raised its mortgage rates. Possible applications for loan repayments by major banks is a risk for the real economy, according to a Chinese analyst.
Despite the promises of Greece to reduce its budget deficit to 3% by 2012, the remarks of his Minister of Finance Mr. Papaconstantinou stressing the problems of Spain and Portugal are not made to reassure financial markets. Portugal also has a large budget deficit, while in Spain the unemployment figures reached their highest point with 4 million unemployed, and the major problems faced by real estate in the south are also feared the worst. Add to this volatile cocktail the declaration of Dutch Finance Minister saying that Ireland is also part of country risk, which can cause a domino effect, and you will understand why the markets remain cautious on the EUR!
The expected support of the European Commission plan to reduce the deficit of Greece and the statements of French Prime Minister Fillon saying that France will balance its budget in 2020, with a first step in 2013 with a deficit of 3%, which corresponds roughly to the economic policy of Germany, seems to cool down a little bit these bad news. But tomorrow's meeting of the European Central Bank, much anticipated by the markets, should allay some fears.
However the EUR should remain under pressure, with resistance to the EUR-USD at 1, 4031

Good day

Pascal Bovay

RTFX Ltd
Trading desk

RTFX Ltd is licensed to conduct investment services business by the Malta Financial Services Authority. This information does not constitute an offer or solicitation and is provided for information purposes only. This information shall not be deemed to constitute advice and should not be relied on as such to enter into a transaction or for any investment decision. Any opinions expressed in this document represent the views of RTFX Ltd at the time of preparation. They are thus subject to change without notice. RTFX Ltd believes that the information contained herein is accurate as at the date of publication. However, no warranty of accuracy is given by RTFX Ltd and no liability in respect of any errors or omissions, including any third party liability, are accepted by RTFX Ltd or any director, officer or employees.