U.S stocks end up after volatile week; Dow gains 0.28%

U.S. stocks finished Friday mixed to higher after a volatile week marked by two sessions of heavy losses stemming from growing expectations for the Federal Reserve to begin scaling back stimulus programs in the coming months.

Stimulus programs tend to push up stocks as a side effect, and talk of their dismantling can send equities prices dropping.

Trading volume was heavy.

At the close of U.S. trading, the Dow Jones Industrial Average finished up 0.28%, the S&P 500 index ended up 0.27%, while the Nasdaq Composite index fell 0.22%.

Stocks rose on Friday after a wild week marked by growing concerns that the Federal Reserve will soon scale back stimulus measures.

On Thursday, the Federal Reserve Bank of Philadelphia said that its manufacturing index rose to 12.5 in June from -5.2 in May, well above expectations for a -2.0 reading.

A separate report showed that U.S. existing home sales climbed 4.2% to 5.18 million units in May from April’s total of 4.97 million, far surpassing market calls for a 0.6% increase.

Federal Reserve stimulus tools such as a monthly USD85 billion bond-buying program have pushed up stock prices in recent years, and the end of such liquidity injections could prompt investors to park their money elsewhere at least for a while, which fueled a massive day of selling on Wall Street and elsewhere.

Investors returned on Friday, however, on sentiment that a Fed decision to wind down stimulus measures would point to an increasingly robust economy, which would be bullish for stock in the long run.

Elsewhere, tech giant Oracle shares plunged 9% after missing sales expectations.

Leading Dow Jones Industrial Average performers included Procter & Gamble, up 2.84%, Coca-Cola, up 1.58%, and Merck, up 1.53%.

The Dow Jones Industrial Average's worst performers included Hewlett-Packard, down 2.27%, Bank of America, down 1.47%, and IBM, down 1.03%.

European indices, meanwhile, finished lower.

After the close of European trade, the EURO STOXX 50 fell 1.43%, France's CAC 40 fell 1.11%, while Germany's DAX 30 finished down 1.76%. Meanwhile, in the U.K. the FTSE 100 finished down 0.70%.

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Forex - Dollar gains as market preps for tapering of Fed stimulus

The dollar extended its broad advance against most major currencies on Friday amid widespread sentiments that the Federal Reserve will soon begin to scale back stimulus programs.

Better-than-expected regional factory and housing data in the U.S. on Thursday came a day after Fed Chairman Ben Bernanke said stimulus programs could end if the economy show signs of improvement.

Monetary stimulus tools such as the Fed's monthly USD85 billion bond-buying program weaken the dollar to spur recovery, and talk of their dismantling can strengthen the U.S. currency.

In U.S. trading on Friday, EUR/USD was down 0.61% at 1.3139.

The dollar continued to climb in a session absent of major U.S. economic data mainly on sentiments that recent indicators point to an economy in less need of Federal Reserve support.

The Federal Reserve Bank of Philadelphia said Thursday that its manufacturing index rose to 12.5 in June from -5.2 in May, well above expectations for a -2.0 reading.

A separate report showed that U.S. existing home sales climbed 4.2% to 5.18 million units in May from April’s total of 4.97 million, far surpassing market calls for a 0.6% increase.

The greenback, meanwhile, was up against the pound, with GBP/USDtrading down 0.51% at 1.5429.

The dollar was up against the yen, with USD/JPY up 0.53% at 97.78, and up against the Swiss franc, with USD/CHF trading up 0.75% at 0.9344.

The dollar was mixed against its cousins in Canada, Australia and New Zealand, with USD/CAD up 0.68% at 1.0455, AUD/USD up 0.53% at 0.9246 and NZD/USD trading up 0.24% at 0.7776.

Canada's official core consumer price index, which excludes volatile food and energy items, rose 0.2% in May, missing expectations for a 0.3% gain after a 0.1% increase the previous month. 

The broader consumer price index rose 0.2% last month, disappointing expectations for a 0.4% increase, after a 0.2% contraction in April. 

A separate report showed that core retail sales in Canada, excluding automobiles, fell 0.3% in April, compared to expectations for a flat reading after a 0.3% decline the previous month. 

Broader retail sales rose 0.1% in April, missing expectations for 0.2% increase, after a flat reading the previous month.

The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.67% at 82.53.

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Fed stand-off

GBP:  The data on government borrowing rarely upsets the pound unless wildly away from expectations.  Sterling still has some underlying support from the better tone to data on the economy.

CAD:  Headline inflation is seen moving higher, from 0.4% to 0.9%.  Currently, USDCAD is not far off the high for the year (1.0421, made late May).

EUR: Finance ministers are meeting. There could be some headlines on Greece as it appears a little more politically unstable which threatens its ability to push ahead on the reforms demanded from its international lenders.

Idea of the Day

Thursday was a small glimpse of the world to come when the US Fed starts taking its foot of the monetary accelerator. Emerging markets were hit hard and the Aussie behaved like a boxer that had just been dealt a knock-out blow, with no signs of getting back on his feet.  Meanwhile bond yields were higher across the board with Italian yields moving up 3 times faster than German ones. All this on the fact that the Fed told us what is abundantly clear, namely they cannot go on buying USD 85 bln of securities a month indefinitely.  Furthermore, they were very subtle in the way it was phrased.  We could be entering something of a stand-off between the Fed and the markets from here, because the worse thing they can do for their credibility is to blink and back-track on the tone of their statement and comments this week in response to the market reaction.

Latest FX News

JPY:  The yen seeing further modest selling pressure during the Asia session. Comments from Kuroda having a limited impact at the start of the European session, the BoJ governor making some positive noises on the economy.

GBP:  The retail sales data on Thursday (stronger than expected) gave sterling a small lift, but it was minimal compared to the post-Fed moves. The data is still shaping up well for a decent second quarter in the UK, which should ultimately prove modestly supportive for sterling in the bigger picture. The1.54 area should continue to provide a decent area of support.

AUD: The Aussie was hammered in the wake of the Fed decision and remained on the floor during Thursday, holding just above the 0.9150 area through the day.

EUR: Trading relatively after the Asia move lower on Thursday, despite the fact that peripheral markets were selling-off quite aggressively in the post-Fed move.   Politically, Greece is looking a little more wobbly at the moment.

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EUR/USD June 21 – Struggling after QE Announcment by Fed

EUR/USD continues to point downward, as the pair tests the 1.32 line. The euro has dropped sharply since Wednesday, as the US Federal Reserve announced that it plans to scale down the current QE program sometime in 2013. There was plenty of action on Thursday, as both the Eurozone and US produced mixed numbers. The week is ending on a quiet note, as there is only one release on the day – Eurozone Current Account. This indicator was well above the estimate.

Here is a quick update on the technical situation, indicators, and market sentiment that moves euro/dollar.

EUR/USD Technical

• Asian session: Euro/dollar edged higher, climbing to a high of 1.3254. The pair consolidated at 1.3245. In the European session, Euro/dollar has moved lower, putting more pressure on the 1.32 line.

Current range: 1.32 – 1.3255.

Further levels in both directions:  

• Below: 1.32, 1.3160, 1.31, 1.3050, 1.30, 1.2940, 1.2890, 1.2840, 1.28, 1.2750 and 1.27.
• Above: 1.3255, 1.3350, 1.34, 1.3434, 1.3480, 1.3580 and 1.3710.
• The pair has been testing 1.32 but it continues to provide weak support. 1.3160 is next.
• On the downside, 1.3254 was tested in the Asian session, but remains intact. 1.3350 is stronger.

Euro struggling after FOMC announcement, weak German data – click on the graph to enlarge.

EUR/USD Fundamentals

• 8:00 Eurozone Current Account. Exp. 15.1B. Actual 19.5B.
• All Day ECOFIN Meetings.

For more events and lines, see the Euro to dollar forecast

EUR/USD Sentiment

• Dollar Jumps as Fed plans to taper QE: The currency markets have been buzzing since late Wednesday, following confirmation from the Federal Reserve that it plans to scale down QE. The Fed said that the current purchase levels of $85 billion will remain in place, but if the economy continues to improve, the program would be scaled down in 2013, and could be terminated in 2014. The Fed said it expects the U.S. economy to grow between 2.3% and 2.6% this year, and unemployment should fall to between 6.5% and 6.8% by the end of 2014. These figures are not edged in stone, so even if GDP and unemployment does not reach these precise numbers, there is a strong likelihood that the Fed will scale down QE. Since QE is dollar-negative, Bernanke’s comment about reducing QE boosted the dollar against the major currencies. The euro has taken a wallop, losing close to two cents since Wednesday.
• Eurozone PPIs positive, but Germany disappoints: Eurozone PMIs were released on Thursday, and the news was mostly positive, as most of the releases beat their estimates. However, the one glaring exception was German Manufacturing PMI, which lost ground in the June release, and missed the estimate. This PMI has been below the 50 level since February, indicating contraction in the manufacturing industry. German PPI also disappointed, declining by 0.3%. The estimate stood at 0.0%. The markets continue to be concerned about the German economy, which has been churning out mixed numbers for quite some time. Germany is the largest economy in the Eurozone, and if the “locomotive of Europe” does not lead the way, there is little chance of the Eurozone being able to recover from the present recession.
• US numbers a mix: The markets had plenty of material to work with on Thursday, as the US released three key events. Unemployment Claims disappointed, coming in at 354 thousand, well above the estimate of 343 thousand. There was better news as Existing Home Sales improved nicely to 5.18 million, easily surpassing the estimate of 5.01 million. The Philly Fed Manufacturing Index, which has been erratic, shot up to 12.5 points from -5.2 points. This blew past the estimate of -0.6 points, and was the key indicator’s best showing since March 2012. We continue to see ups and downs from US economic indicators, making it difficult to gauge the extent of the US recovery.
• Draghi open to unconventional measures: ECB President Mario Draghi reiterated in a speech earlier this week that he is open to “non-standard” monetary tools, and would not hesitate to use such measures if needed. Draghi hinted recently that a negative deposit rate was on the table, and the markets reacted negatively, as the euro took a hit. Other measures include long-term lending operations and modifying collateral requirements. Draghi is widely credited for his role in keeping the struggling Eurozone intact and afloat in difficult times, but still has his work cut out for him, as the Eurozone is now mired in its longest recession since the zone was created in 1999. If the ECB does take steps to introduce negative rates or other non-standard measures, we can expect a sharp reaction from the currency markets.
• High unemployment, low inflation bedevil Europe: The Eurozone economy continues to sputter, and a large part of the problem is low inflation and high unemployment. Last week’s inflation numbers in the Eurozone were up slightly, coming in at 1.4%. However, this remains well below the ECB’s target of 2%. The ECB recently lowered interest rates to 0.50%, hoping to raise inflation and increase economic activity. Unemployment in the Eurozone has risen to 12%, and is much higher among younger Europeans. The persistent unemployment crisis has led policymakers to declare that the Eurozone unity faces more danger from a social breakdown than from any market forces. With a severe recession affecting many members, politicians and policymakers will have to find a way to tackle the severe growth and unemployment problems facing the Eurozone if it is to remain intact.

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Forex Analysis: GBP/USD Drops Sharply to Key Support on Dollar Strength

June 20, 2013 – GBP/USD (daily chart) has fallen further on marked dollar strength since the beginning of the week. This decline has brought price down to key support around 1.5400, a major price level that has served as both support and resistance many times in the past. The sharp drop down to this level occurred after price expectedly turned down in the beginning of the week from strong resistance around the 1.5750 price level, which was also around the 61.8% Fibonacci retracement level of the steep downtrend from the high above 1.6300 at the very beginning of the year down to the March low above 1.4800.

Generally-speaking, GBP/USD has tended to behave technically, often moving rather accurately from key level to key level. The downside level to watch for any indication of a potential resumption of the entrenched downtrend remains at the current 1.5400 level. Any breakdown below 1.5400 should target downside support objectives around 1.5250 and then 1.5000, with the most important bearish objective being a re-test of the March 1.4830 low.

James Chen, CMT
Chief Technical Strategist
City Index Group

Forex trading involves a substantial risk of loss and is not suitable for all investors. This information is being provided only for general market commentary and does not constitute investment trading advice. These materials are not intended as an offer or solicitation with respect to the purchase or sale of any financial instrument and should not be used as the basis for any investment decision.

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EUR/USD June 20 – Sharp Drops After Bernanke Says QE Tapering Likely

EUR/USD continues to drop in Thursday trading. The pair dropped over one cent on Wednesday, following remarks by Fed chief Bernard Bernanke that the Fed will likely scale down the current QE program sometime in 2013. The pair continues to fall on Thursday as German PPI and Manufacturing PMI missed their  estimates. In the US, we can look forward to a busy day with the release of three key indicators – Unemployment Claims, Existing Home Sales and Philly Fed Manufacturing Index.

Here is a quick update on the technical situation, indicators, and market sentiment that moves euro/dollar.

EUR/USD Technical

• Asian session: Euro/dollar dropped lower, touching a low of 1.3245. The pair consolidated at 1.3251. The pair continues to fall in the European session and is testing the 1.32 line.

Current range: 1.32 – 1.3255.

Further levels in both directions: 

• Below: 1.32, 1.3160, 1.31, 1.3050, 1.30, 1.2940, 1.2890, 1.2840, 1.28, 1.2750 and 1.27.
• Above: 1.3255, 1.3350, 1.34, 1.3434, 1.3480, 1.3580 and 1.3710.
• The pair is testing 1.32 on the downside. 1.3160 is the next support level.
• 1.3255 is providing weak resistance. This is followed by 1.3350.

Euro slides after Fed statement on QE – click on the graph to enlarge.

EUR/USD Fundamentals

• 6:00 German PPI. Exp. 0.0%. Actual -0.3%.
• 7:00 French Flash Manufacturing PMI. Exp. 47.1 points. Actual 48.3 points.
• 7:00 French Flash Services PMI. Exp. 45.0 points. Actual 46.5 points.
• 7:00 German Flash Manufacturing PMI. Exp. 49.9 points. Actual 48.7 points.
• 7:00 German Flash Services PMI. Exp. 50.1 points. Actual 51.3 points.
• 8:00 Eurozone Flash Manufacturing PMI. Exp. 48.6 points. Actual 48.7 points.
• 8:00 Eurozone Flash Services PMI. Exp. 47.7 points. Actual 48.6 points.
• Tentative – Spanish 10-year Bond Auction.
• All Day – Eurogroup Meetings.
• 12:30 US Unemployment Claims. Exp. 343K.
• 13:00 US Flash Manufacturing PMI. Exp. 52.5 points.
• 14:00 Eurozone Consumer Confidence. Exp. -22 points.
• 14:00 US Existing Home Sales. Exp. 5.01M.
• 14:00 US Philly Fed Manufacturing Index. Exp. -0.6 points.
• 14:00 US CB Leading Index. Exp. 0.2%.
• 14:30 US Natural Gas Storage. Exp. 89B.

For more events and lines, see the Euro to dollar forecast

EUR/USD Sentiment

• Dollar Jumps as Fed says QE tapering likely: There was plenty of activity in the currency markets late Wednesday, following remarks by Federal Reserve chair Bernard Bernanke with regard to QE. The Fed said that the current purchase levels of $85 billion will remain in place, but if the economy continues to improve, the program would be scaled down in 2013, and could be terminated in 2014. The Fed said it expects the U.S. economy to grow between 2.3% and 2.6% this year, and unemployment should fall to between 6.5% and 6.8% by the end of 2014. These figures are not edged in stone, so if the US economy does show stronger growth and unemployment falls, there is a strong likelihood that the Fed will scale down QE. Since QE is dollar-negative, Bernanke’s comment about reducing QE boosted the dollar against the major currencies. The euro has plunged, losing about two cents since Wednesday.
• Eurozone PPIs positive, Germany disappoints: Eurozone PMIs were released on Thursday, and the news was mostly positive, as most of the releases beat their estimates. However, the one glaring exception was German Manufacturing PMI, which lost ground in the June release, and missed the estimate. This PMI has been below the 50 level since February, indicating contraction in the manufacturing industry. German PPI also disappointed, declining by 0.3%. The estimate stood at 0.0%.
• Draghi open to unconventional measures: ECB President Mario Draghi reiterated in a speech on Tuesday that he is open to “non-standard” monetary tools, and would not hesitate to use such measures if needed. Draghi hinted recently that a negative deposit rate was on the table, and the markets reacted negatively, as the euro took a hit. Other measures include long-term lending operations and modifying collateral requirements. Draghi is widely credited for his role in keeping the struggling Eurozone intact and afloat in difficult times, but still has his work cut out for him, as the Eurozone is now mired in its longest recession since the zone was created in 1999. If the ECB does take steps to introduce negative rates or other non-standard measures, we can expect a sharp reaction from the currency markets.
• G8 discusses EU – US Free Trade Agreement: International summits are often long on ceremony and pomp and short on substance. However, this year’s G8 meeting in Northern Ireland was not business as usual, as the leaders used the occasion to announce the start of negotiations on a free trade agreement between the European Union and the United States. The stakes are very high – the EU and US produce half the global output, and a third of world trade. A free trade agreement between the US and the EU would  be the largest bilateral agreement ever, and could add up to $100 billion to the economies of each partner. Negotiations will get underway in early July, and the leaders want to have a deal in place by the end of 2014, certainly an ambitious time frame.
• High unemployment, low inflation bedevil Europe: The Eurozone economy continues to sputter, and a large part of the problem is low inflation and high unemployment. Last week’s inflation numbers in the Eurozone were up slightly, coming in at 1.4%. However, this remains well below the ECB’s target of 2%. The ECB recently lowered interest rates to 0.50%, hoping to raise inflation and increase economic activity. Unemployment in the Eurozone has risen to 12%, and is much higher among younger Europeans. The persistent unemployment crisis has led policymakers to declare that the Eurozone unity faces more danger from a social breakdown than from any market forces. With a severe recession affecting many members, politicians and policymakers will have to find a way to tackle the severe growth and unemployment problems facing the Eurozone if it is to survive.

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European stocks remain higher in thin trade; Dax up 0.08%

European stocks remained higher in thin trade on Friday, after positive euro zone data and as market sentiment recovered after sharp losses were fuelled by Federal Reserve Chairman Ben Bernanke's comments on Wednesday. 

During European afternoon trade, the EURO STOXX 50 rose 0.33%, France’s CAC 40 climbed 0.58%, while Germany’s DAX 30 edged up 0.08%. 

The European Central Bank said its current account surplus narrowed to EUR19.5 billion in April, from a surplus of EUR25.9 billion, confounding expectations for the surplus to narrow to EUR14.2 billion. 

Global stocks were hit after Fed Chairman Ben Bernanke on Wednesday said the bank could begin slowing asset purchases by the end of 2013 and wind them down completely by the middle of 2014 if the economy picks up as the central bank expects. 

Financial stocks were mixed, as shares in French lenders BNP Paribas and Societe Generale slipped 0.08% and 0.16%, while Germany's Deutsche Bank climbed 0.65%. 

Among peripheral lenders, Spanish bank Banco Santander advanced 0.60%, while Italy's Intesa Sanpaolo and Unicredit fell 0.32% and 0.20% respectively. 

Elsewhere, SAP AG plummeted 1.73% as the German maker of business-management software was affected by U.S. rival Oracle's quarterly sales report, saying it missed estimates. 

In London, FTSE 100 jumped 0.74%, supported by gains in financial stocks and after official data showed that U.K. public sector net borrowing rose less-than-expected in May. 

Shares in HSBC Holdings rallied 1.48% and Barclays rose 0.42%, while Lloyds Banking surged 1.40%. The Royal Bank of Scotland remained sharply lower on the other hand, plunging 2.84%. 

Meanwhile, mining stocks remained mostly lower, as BHP Billiton slipped 0.25% and Polymetal tumbled 1.45%, while Fresnillo dove 4.37%. 

In the U.S., equity markets pointed to a higher open. The Dow Jones Industrial Average futures pointed to a 0.60% increase, S&P 500 futures signaled a 0.75% advance, while the Nasdaq 100 futures indicated a 0.61% gain. 

Trading volumes were expected to remain light, as no U.S. data was scheduled to be released throughout the day.

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U.S. futures higher on global rebound; Dow Jones up 0.61%

U.S. stock futures pointed to a higher open on Friday, as global markets rebounded after posting heavy losses on Thursday due to comments by Federal Reserve Chairman Ben Bernanke on Wednesday. 

Ahead of the open, the Dow Jones Industrial Average futures pointed to a 0.61% gain, S&P 500 futures signaled a 0.75% increase, while the Nasdaq 100 futures indicated a 0.61% rise. 

Stocks came under pressure after Fed Chairman Ben Bernanke said the bank could begin slowing asset purchases by the end of 2013 and wind them down completely by the middle of 2014 if the economy picks up as the central bank expects. 

However, a string of mixed U.S. economic reports on Thursday fuelled uncertainty over the strength of the country's economic recovery. 

The Federal Reserve Bank of Philadelphia said that its manufacturing index rose to 12.5 in June from minus 5.2 in May, outstripping expectations for a reading of minus 2.0 and rising at the fastest pace since April 2011. 

The data came after the Department of Labor said the number of individuals filing for initial jobless benefits last week rose by 18,000 to a seasonally adjusted 354,000, a three-week high, compared to expectations for an increase of 4,000 to 340,000. 

Tech stocks were expected to be active, after Oracle announced late Thursday that it missed forecasts for software sales and subscriptions for the second straight quarter, sending shares down 8.16% in after-hour trade. 

Separately, Apple gained 0.56% pre-market after the tech giant made a final pitch to defend itself against U.S. charges it led publishers in a scheme to fix the prices for electronic books. 

In company news, Sprint Nextel raised its buyout offer for Clearwire to USD5 per share late on Thursday and announced support from a key group of dissident shareholders, trumping rival suitor Dish Network. 

Sprint shares edged up 0.14% in pre-market trade. 

AT&T was up 0.44% in early trading amid report it explored potential deals in the last two months including buying part of Telefonica or some of its foreign assets. 

Other stocks in focus included CarMax and Darden Restaurants, due to report earnings before the start of trade. 

Across the Atlantic, European stock markets were sharply higher. The EURO STOXX 50 gained 0.99%, France’s CAC 40 jumped 1.16%, Germany's DAX advanced 0.65%, while Britain's FTSE 100 rallied 1.16%. 

During the Asian trading session, Hong Kong's Hang Seng Index dropped 0.59%, while Japan’s Nikkei 225 Index surged 2.62%. 

Trading volumes were expected to remain light, as no U.S. data was scheduled to be released throughout the day.

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Dollar mixed vs. rivals in light trade

The U.S. dollar was mixed against the other major currencies in light trade on Friday, as Thursday's U.S. data painted a mixed picture of the strength of the economic recovery, while questions over the future of the Federal Reserve's stimulus program supported the greenback. 

During European morning trade, the dollar was steady against the euro, with EUR/USD easing up 0.03% to 1.3223. 

The European Central Bank said its current account surplus narrowed to EUR19.5 billion in April, from a surplus of EUR25.9 billion, confounding expectations for the surplus to narrow to EUR14.2 billion. 

The greenback was higher against the pound, with GBP/USD slipping 0.17% to 1.5480. 

Official data earlier showed that U.K. public sector net borrowing rose less-than-expected in May, rising by GBP10.5 billion, after a GBP6.6 billion increase the previous month. 

Analysts had expected public sector net borrowing to rise by GBP13.8 billion last month. 

Elsewhere, the greenback was higher against the yen, with USD/JPYadvancing 0.49% to trade at 97.72, and steady against the Swiss franc, with USD/CHF inching 0.01% higher to 0.9274. 

Earlier in the day, Bank of Japan Governor Haruhiko Kuroda said financial markets will likely stabilise over time, reflecting improvements in Japan's economy. 

Kuroda also warned that uncertainty surrounding the world's third-largest economy remains high, and that the central bank will carefully watch market developments. 

The greenback was lower against its Canadian, Australian and New Zealand counterparts, with USD/CAD dipping 0.02% to 1.0381,AUD/USD climbing 0.41% to 0.9234 and NZD/USD adding 0.17% to 0.7770. 

The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.07% to 82.04. 

The greenback remained supported after Fed Chairman Ben Bernanke on Wednesday said the bank could begin slowing asset purchases by the end of 2013 and wind them down completely by the middle of 2014 if the economy picks up as the central bank expects. 

Trading volumes were expected to remain light, as no U.S. data was scheduled to be released throughout the day.

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Forex - GBP/USD edges lower despite positive U.K. data

The pound edged lower against the U.S. dollar on Friday, despite positive U.K. data, as the possibility of a near-term end to the U.S. Federal Reserve's stimulus program supported the greenback. 

GBP/USD hit 1.5473 during European morning trade, the session low; the pair subsequently consolidated at 1.5483, slipping 0.16%. 

Cable was likely to find support at 1.5415, Thursday's low and resistance at 1.5587, the high of June 10. 

Official data showed that U.K. public sector net borrowing rose less-than-expected in May, rising by GBP10.5 billion, after a GBP6.6 billion increase the previous month. 

Analysts had expected public sector net borrowing to rise by GBP13.8 billion last month. 

But the greenback remained supported after Fed Chairman Ben Bernanke on Wednesday said the bank could begin slowing asset purchases by the end of 2013 and wind them down completely by the middle of 2014 if the economy picks up as the central bank expects. 

Sterling was lower against the euro with EUR/GBP adding 0.17%, to hit 0.8538. 

Trading volumes were expected to remain light, as no U.S. data was scheduled to be released throughout the day.

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European stocks higher despite Fed jitters; Dax up 0.14%

European stocks were higher in light trade on Friday, although concerns over the future of the U.S. stimulus program following comments by Federal Reserve Chairman Ben Bernanke persisted. 

During European morning trade, the EURO STOXX 50 added 0.29%, France’s CAC 40 climbed 0.52%, while Germany’s DAX 30 edged up 0.14%. 

Stocks remained under pressure after Fed Chairman Ben Bernanke said the bank could begin slowing asset purchases by the end of 2013 and wind them down completely by the middle of 2014 if the economy picks up as the central bank expects. 

On Thursday, the euro zone manufacturing purchasing manager's index rose to 48.7 in June from a final reading of 48.3 in May, but remained well below the 50 level that separates contraction from expansion.

Service sector activity in the euro zone improved to a 15-month high in June, with the services PMI rising to 48.6 from 47.2 in May, above expectations for an increase to 47.5. 

Financial stocks were broadly higher, as shares in French lenders BNP Paribas and Societe Generale jumped 1.04% and 0.73%, while Germany's Deutsche Bank rallied 1.19%. 

Peripheral lenders added to gains, with Spanish banks BBVA and Banco Santander climbing 0.46% and 0.60% respectively, while Italy's Intesa Sanpaolo and Unicredit advanced 0.84% and 1.27%. 

In London, FTSE 100 gained 0.46%, as U.K. lenders tracked their European counterparts higher. 

Shares in HSBC Holdings climbed 0.57% and Barclays rose 0.67%, while Lloyds Banking jumped 1.12%. The Royal Bank of Scotland underperformed on the other hand, sliding 0.74%. 

Mining stocks were also on the upside, as BHP Billiton and Rio Tinto rallied 0.74% and 1.45% respectively, while Glencore and Antofagasta surged 1.52% and 1.57%. 

In the U.S., equity markets pointed to a hiher open. The Dow Jones Industrial Average futures pointed to a 0.58% increase, S&P 500 futures signaled a 0.67% advance, while the Nasdaq 100 futures indicated a 0.45% gain. 

Trading volumes were expected to remain light, as no U.S. data was scheduled to be released throughout the day.

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Forex Trading Signal for 21st June 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 :

 (1) SELL

E/P: 1.32228

T/P: 1.31800

S/L: 1.32800

GBP/USD

Up Trend:

(1) BUY

E/P: 1.54835

T/P: 1.55300

S/L: 1.54300

NOTE: The above posted Signals are delayed 2 - 4 hours after it has been  generated.
Daily forex signals are sent ontime to only our subcribers.

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Crude oil futures rise in subdued trade

Crude oil futures were higher in subdued trade on Friday, as the release of mixed U.S. data on Thursday lessened the impact of Federal Reserve Chairman Ben Bernanke's comments on the future of the bank's stimulus program. 

On the New York Mercantile Exchange, light sweet crude futures for delivery in August traded at USD95.50 a barrel during European morning trade, up 0.37%. 

The Federal Reserve Bank of Philadelphia said that its manufacturing index rose to 12.5 in June from minus 5.2 in May, outstripping expectations for a reading of minus 2.0 and rising at the fastest pace since April 2011. 

Separately, the Department of Labor said the number of individuals filing for initial jobless benefits last week rose by 18,000 to a seasonally adjusted 354,000, a three-week high, compared to expectations for an increase of 4,000 to 340,000. 

The reports came after Fed Chairman Ben Bernanke on Wednesday said the bank could begin slowing asset purchases by the end of 2013 and wind them down completely by the middle of 2014 if the economy picks up as the central bank expects. 

The U.S. is the world’s biggest oil-consuming country, responsible for almost 22% of global oil demand. 

Elsewhere, on the ICE Futures Exchange, Brent oil futures for August delivery advanced 0.50% to trade at USD102.65 a barrel, with the spread between the Brent and crude contracts standing at USD7.15 a barrel.

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