Asian stocks mostly lower ahead of Chinese data; Nikkei up 2.21%

Most Asian shares are trading to the downside at this hour as traders await China’s latest CPI and PPI reports, but Japanese stocks are soaring on the back of a weaker yen. 

In Asian trading Monday, Japan’s Nikkei 225 is up 2.21% as USD/JPYtrades near its highest levels in nearly four years. The yen dropped more than 3% against the dollar last Thursday after the Bank of Japan said it plans to double its asset purchase program over the next two years and extend the maturities of the bonds it purchases.

Traders also ditched the yen following the current account deficit report. Earlier today, the Ministry of Finance said that Japan’s current account balance for the first quarter was JPY637.4 billion, well above the JPY457.5 billion median estimate. 

Hong Kong’s Hang Seng is down 0.25% while the Shanghai Composite is lower by 1.72% following a two-day holiday. That means the benchmark mainland index has plunged 10% since its February peak. Speculation regarding a new outbreak of bird flu is seen hampering Chinese shares. 

Elsewhere, riskier assets are under pressure after Portuguese Prime Minister Pedro Passos Coelho said the government there will have reduce spending. Last Friday, a court invalidated some of Portugal’s austerity measures that were implemented in 2011 as part of a bailout package. 

Last Friday, Portugal’s Constitutional Court ruled against a 2013 budge that include EUR5 billion in tax hikes, leaving the country short EUR1.4 billion in expected revenue. Portugal, the "P" in the popular PIIGS acronym, was the third euro zone member after fellow PIIGS members Greece and Ireland to receive bailout assistance 

Australia’s S&P/ASX 200 is essentially unchanged while New Zealand’s NZSE 50 slipped 0.89%. South Korea’s Kospi fell 0.18%, extending losses accrued last week following BoJ’s efforts to further weaken the yen. 

Singapore’s Straits Times Index dropped 0.16%. S&P 500 are flat at this writing. The benchmark U.S. index fell nearly 1%, good for its worst performance this year. 

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Forex Trading Signals for 8th April 2013

                                                                                


Japan (Tokyo)                               United Kingdon (London)                        USA (New York)


For more easy access,,,,,,Download our mobile application on your mobile :   Click Fxsignals 

Forex Signal for 8 April 2013,,,,,,

EUR/USD

Up Trend : BUY

(1) BUY

E/P: 1.29808

T/P: 1.30200

S/L: 1.29400

 (2) SELL

E/P: 1.29815

T/P: 1.29500

S/L: 1.30200

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GBP/USD

UP Trend: BUY

(1) BUY

E/P: 1.53028

T/P: 1.53500

S/L: 1.52600

(2) SELL

E/P: 1.53204

T/P: 1.52900

S/L: 1.53600

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Battle of the Budgets….dead ahead

There’s a battle going on and the battle is which version of the 2014 budget will be approved? The folks in DC are jockeying for position to determine which budget will be approved. Last month, two budgets were revealed: the Ryan budget, produced by GOP Congressman Paul Ryan and the Murray budget, produced by Democrat Senator Patty Murray.

The issue is the Ryan budget passed the GOP controlled House of Representatives but can’t pass the Senate. The Murray budget passed the Democrat controlled Senate but can’t pass the House of Representatives. This week President Obama will reveal his version of a budget.

At this point we don’t really know what his budget will contain as he was supposed to release it on April 1st but elected to wait until Wednesday, April 10th to do so. So what do we know? We know that his budget will include “entitlement” cuts to Medicare and Social Security. Any increase in Social Security payouts will be based upon “chained CPI” which is not reflective of the true COLA or Cost of Living Adjustments. Chained CPI is based on a formal number issued by the Federal government. So, if officially the Consumer Price Index went up 2.1 percent over the course of a year, then that’s what the increase should be. If oil goes up to $140.00 a barrel over the course of that year, well then you’d wait a year before it’s reflected in the increase. In the meantime you have to pay the increase if you drive a motor vehicle that uses gasoline. The President, I suspect is offering this as a “dove” so to speak to the GOP. I don’t think the GOP is convinced that this is enough.

Medicare cuts have been well known for quite some time. The 2% across the board cut to this program which started on March 2nd due to the sequester has resulted in some seniors being denied treatment. These seniors have catastrophic illnesses and medical centers that treat them have denied to do so as they claim that “we’ll be out of business in 6 months to a year if we did so.” So seniors who paid into the system their whole working lives are being denied benefits because DC can’t get their act together.

While we’re on the subject of the sequester, I had written previous articles concerning the impact of the sequester and this past Friday the monthly Jobs Report showed a gain of 88,000 versus an expectation of 198,000. This past Thursday Unemployment Claim numbers were released that showed an increase of 33,000 new claims. As readers of Market Tea Leaves know, I’ve been saying for months that this debt ceiling/budget issue will come home to roost and unfortunately it’s starting to happen.

The reader may be asking what does this have to do with the markets. In a word: everything. The markets do not like uncertainty when it comes to financial issues. All we need do is to look back less than two years ago in the summer of 2011 when stocks fell and the bond market roared. The 30 year bond was trading well over the 150 mark and ironically we’re getting close to that again.

The folks in DC seem to view the economy as some kind of finite number that can never be surpassed. In other word, it can’t really grow much further. Interesting. During the Reagan years GDP in the United States was 11-12 Trillion dollars, if we operated with that kind of GDP today, it would be considered a depression. One thing is certain, I’m sure the GOP and the far left won’t like Obama’s budget either.

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Forex Trading Signals for 4th April 2013

                                                                                


Japan (Tokyo)                               United Kingdon (London)                        USA (New York)


For more easy access,,,,,,Download our mobile application on your mobile :   Click Fxsignals 

EUR/USD

Down Trend : SELL

(1) SELL

E/P: 1.28362

T/P: 1.28000

S/L: 1.286000

(1) BUY

E/P: 1.28379

T/P: 1.28600

S/L: 1.28000

 

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GBP/USD

Down Trend: SELL

(1) SELL

E/P: 1.51057

T/P: 1.50700

S/L: 1.50400

(2) BUY

E/P: 1.51245

T/P: 1.51600

S/L: 1.50900

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Forex - GBP/USD weekly outlook: April 8 - 12

The pound rose to six-week highs against the dollar on Friday after a weaker-than-expected U.S. nonfarm payrolls report sparked fears that the recovery in the U.S. labor market is running out of steam.

GBP/USD hit session highs of 1.5364, the pair’s highest since February 20 before settling at 1.5344, up 0.73% for the day, extending the week’s gains to 0.80%.

Cable is likely to find support at 1.5198, Friday’s low and resistance at 1.5507, the high of February 18.

The Department of Labor said the U.S. economy added 88,000 jobs last month, the smallest increase since last June and far below forecasts for an increase of 200,000. The U.S. unemployment rate ticked down to 7.6% from 7.7% in February.

The report came after disappointing data on U.S. manufacturing and service sector activity and private sector job creation earlier in the week.

Sterling was higher against the dollar on Thursday after the Bank of England left interest rates on hold at 0.5% and the size of its asset purchase program unchanged at GBP375 million.

The decision came on the heels of data showing that the U.K. service sector expanded at the fastest pace in seven months in March, fuelling hopes that the economy will narrowly avoid a triple-dip recession.

The Markit/CIPS services purchasing managers’ index rose to 52.4 from a reading of 51.8 in February, compared to expectations for a decline to 51.5.

The report said that service sector growth looked likely to offset contractions in the manufacturing and construction sectors, with PMI data pointing to overall economic growth of 0.1% in the first quarter.

Elsewhere, the pound was higher against the euro on Friday, withEUR/GBP slipping 0.21% to settle at 0.8474.

The single currency came under pressure after official data showed that retail sales in the euro zone fell 0.3% in February from the previous month and were 1.4% lower year-on-year. 

The weak data underscored concerns over the deteriorating economic outlook for the currency bloc. 

On Thursday, European Central Bank President Mario Draghi said weak economic activity in the region had extended into the early part of this year, but added that a gradual recovery should take hold in the second half of the year.

The comments came after the ECB left rates on hold at 0.75%.

In the week ahead, investors will be awaiting Wednesday’s minutes of the Federal Reserve’s March policy meeting, amid speculation over when the central bank may begin to wind down its asset purchase program.

Market participants will also be watching U.S. data on retail sales and consumer sentiment on Friday in an attempt to gauge the strength of the U.S. economic recovery.

Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets. The guide skips Monday as there are no relevant events on the day.

Tuesday, April 9

The U.K. is to publish official data on manufacturing production and the trade balance, the difference in value between imports and exports.

Federal Reserve Chairman Ben Bernanke is to speak; his comments will be closely watched for indications of the future possible direction of monetary policy.

Wednesday, April 10

The Federal Reserve is to publish the minutes of its most recent policy meeting. The minutes give investors important insights into economic conditions from the bank’s perspective. 

The U.S. is also to release government data on the federal budget balance.

Thursday, April 11 

The U.S. is to publish the weekly government report on initial jobless claims and official data on import prices.

Friday, April 12

The U.S. is to round up the week with official data on retail sale, producer price inflation and business inventories, as well as preliminary data from the University of Michigan on consumer sentiment. 

Also Friday, Fed Chairman Ben Bernanke is to speak; his comments will be closely watched for indications of the future possible direction of monetary policy.

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Forex - EUR/USD weekly outlook: April 8 - 12

The euro rose to two-week highs against the dollar on Friday after weaker-than-forecast U.S. nonfarm payrolls data for March added to concerns that the economic recovery in the U.S. may be losing traction.

EUR/USD hit session highs of 1.3039, the pair’s highest since March 25 before settling at 1.3004, 0.53% higher for the day and up 1.19% for the week.

The pair is likely to find support at 1.2899, Friday’s low and resistance at 1.3106, the high of March 15.

The Department of Labor said the U.S. economy added 88,000 jobs last month, the smallest increase since last June and far below forecasts for an increase of 200,000. The U.S. unemployment rate ticked down to 7.6% from 7.7% in February.

The report came after disappointing data on U.S. manufacturing and service sector activity and private sector job creation earlier in the week.

In the euro zone, official data showed that retail sales across the currency bloc fell 0.3% in February from the previous month and were 1.4% lower year-on-year. 

The weak data underscored concerns over the deteriorating economic outlook for the region. 

The euro touched four-month lows against the dollar on Thursday after European Central Bank President Mario Draghi said the bank was ready to act to cut rates if needed.

Draghi said weak economic activity in the region had extended into the early part of this year, but added that a gradual recovery should take hold in the second half of the year.

The comments came after the ECB left rates on hold at 0.75%.

In the week ahead, investors will be awaiting Wednesday’s minutes of the Federal Reserve’s March policy meeting, amid speculation over when the central bank may begin to wind down its asset purchase program.

Market participants will also be watching data on industrial production from Germany and the euro zone amid concerns over the outlook for first quarter growth.

Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.

Monday, April 8

In the euro zone, Germany is to produce official data on industrial production, a leading economic indicator.

Tuesday, April 9

Federal Reserve Chairman Ben Bernanke is to speak; his comments will be closely watched for indications of the future possible direction of monetary policy.

Wednesday, April 10

In the euro zone, France is to publish official data on industrial production.

The Federal Reserve is to publish the minutes of its most recent policy meeting. The minutes give investors important insights into economic conditions from the bank’s perspective. 

The U.S. is also to release government data on the federal budget balance.

Thursday, April 11 

The ECB is to release its monthly bulletin, which outlines the economic outlook from the bank’s perspective. Meanwhile, Italy is to hold an auction of 10-year government bonds.

The U.S. is to publish the weekly government report on initial jobless claims and official data on import prices.

Friday, April 12

The U.S. is to round up the week with official data on retail sales, producer price inflation and business inventories, as well as preliminary data from the University of Michigan on consumer sentiment. 

Also Friday, Fed Chairman Ben Bernanke is to speak; his comments will be closely watched for indications of the future possible direction of monetary policy.

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