Posts Tagged: Debt ceiling

The unsolved situation in which the US Dollar continues to be trapped due to the crisis caused by the debt-limit is likely to cause the US currency to fall some more against its major counterparts. The deadline for the downgrading of the US credit rate rating is to be due on the 2nd of August and the lawmakers have not yet reached a solution.

This has caused the Dow Jones Industrial Average fall by 4.2 percent, while the Dow Jones FXCM Dollar Index decreased by 1.2 percent. As the situation has been tensed for quite a while now and the US Congress and the US President have not yet managed to take a decision, traders fear that the situation will continue as such, causing the rating to be downgraded, which would make the US Dollar fall behind expectations. The country is on the verge of running short of funds and becoming insolvent. The volatility of the US Read more »

The Australian Dollar registered gains against all its major counterparts today, but especially against the US Dollar. The growth against the US currency has reached new record levels based on the crisis with which the US continues to be confronted as neither of the parties accepts giving up some of its intentions concerning the level of the debt ceiling. As the deadline is to be reached in a week, the situation tends to get worse every single hour, making the US Dollar fall against lots of other currencies around the world. As well, as the consumer inflation reports indicated higher values than the ones expected by traders in what it concerns the Australian economy, values which are hinting more hawkish interest rate policy, the Australian Dollar managed to gain territory and to score new record highs.

The Australian Dollar has been favored by the results of the CPI data for the second quarter of the year 2011 which Read more »

Asian Stock markets opened higher today. NIKKEI started the day at 10,096.89, previous close was 10,010.39. HANG SENG opened at 22,251.02, previous close was 21,987.29.

The markets have reacted positively after European Union leaders reached a new deal for Greece and other debt plagued eurozone countries. Another factor supporting the stock markets is strong Morgan Stanley results. As fear of contagion from Greece will engulf Spain and Italy fades away, investors are still cautious. Yesterday, S&P rating services reminded that the United States may lose its AAA credit rating if the U.S. lawmakers fail to raise the country’s debt limit before the deadline. Even though investors bet the U.S. will maintain its debt payments and keep its credit rating, the Japanese yen’s strength against the dollar is something that they can not ignore.

Asian session is going flat and calm today. EUR rallied to a two week high against USD yesterday after EU leaders agreed on Read more »

Asian Stock markets opened slightly higher today. NIKKEI started the day at 10,019.94, previous close was 10,005.90. HANG SENG opened at 22,054.42, previous close was 22,003.69. Strong gains made the day before on hopes that the EU leaders will come up with some solution, which doesn’t involve postponing, to solve the fiscal crisis. However, it seems that upside is limited as investors are still concerned about the U.S. debt limit. Deputy General Manager at Cosmo Securities, Mitsuo Shimizu said “Most investors are stuck to the sidelines today ahead of the EU summit and as nothing has been decided yet on the U.S. debt ceiling issue”. Even though President Obama backed a deficit reduction plan released by a bipartisan group of senators yesterday, there are still plenty of uncertainties over the U.S. debt ceiling talks. In addition, the U.S. lawmakers have less than 2 weeks to raise the country’s debt ceiling.

Asian session started the day with USD weakening Read more »

Asian Stock markets opened higher today. NIKKEI started the day at 10,008.00, previous close was 9,889.72. HANG SENG opened at 22,077.55, previous close was 21,902.40. Asian stocks are climbing on optimism that U.S. lawmakers will reach an agreement before the deadline. Another factor fueling investors’ expectation is strong U.S. corporate earnings. Fund manager at Shinkin Asset Management, Naoki Fujiwara said “The market may stay strong throughout the day on hopes that U.S. earnings will continue to cheer investors. If Intel Corp’s results later in the day are good, tech shares may continue climbing”. It seems that further gains will depend on Japanese corporate earnings due out next week.

Asian session is going flat today. We see some USD strength against other major currencies except JPY. Gold fell below $1,600 level after President Barack Obama backed a deficit reduction plan released by a bipartisan group of senators. The proposal, which seems to include constructive ideas to deal with the Read more »

First trading day of the week and Asian Stock markets opened slightly lower. The Tokyo Stock Exchange is closed due to Japan holiday today. Hong Kong stocks are climbing slowly. HANG SENG opened at 21,790.20, previous close was 21,875.38. We see that there is a cautious approach to the market as investors look ahead to corporate results and resolutions to debt problems in the eurozone and the United States. Investors also focus on gold mining stocks as gold make new record high every day. Chief commodity analyst at HSBC, James Steel said “The longer the debt talk drags on, the more you would want to own a safe haven like gold. The crude oil market is also rallying quite nicely, and that’s a big element in support for gold”. Some analysts think that gold may rise above $1,700 an ounce within a couple of months, based on charts.

Unfortunately, with no solution to the U.S. debt crisis in Read more »

Asian Stock markets opened slightly lower today. NIKKEI started the day at 9,919.59, previous close was 9,936.12. HANG SENG opened at 21,874.43, previous close was 21,940.20. The stock markets are still under pressure due to ongoing concerns over eurozone fiscal problems and U.S. debt woes. Despite the fact that the outlook of global economy is a bit gloomy, analysts say that the majority of Tokyo shares are still trading at or below their book value. Currency strategist at Tachibana Securities, Kenichi Hirano said “While there are many external factors that are dampening the mood, Japanese stocks are attracting foreign buying with their cheap valuations”. Analysts say that trading may be sluggish ahead of U.S. economic indicators such as the consumer price index, industrial production and a stress test of European banks due later today. Investors are also focusing on corporate earnings. Citigroup is going to release its quarterly results today.

U.S. debt ceiling discussions and rating services’ latest Read more »

Asian Stock markets opened lower today. NIKKEI started the day at 9,929.18, previous close was 9,963.14. HANG SENG opened at 21,900.62, previous close was 21,926.88. Today we see the impacts of Moody’s statement and FED Chairman Ben Bernanke’s speech yesterday. Investors are reducing their positions as concerns about U.S. debt ceiling problems and eurozone debt worries increase. Fund manager at IG Investment, Tim Leung said “There’s uncertainty and confusion about whether we are going to see executives and legislators settle on the debt limit and the Moody’s review suggests that there may be a problem if they cannot reach a deal. There is a definite timeline for the U.S. debt ceiling discussion and also with financing the maturing papers from Italy, so both are risks in people’s mind”.

Asian session started the day with USD weakness. CHF, JPY and gold are making new highs. As the current situation is making investors more cautious, we see that the demand Read more »

Asian Stock markets are sliding on concerns over the eurozone debt crisis may spread to Spain and Italy. NIKKEI started the day at 9,943.32, previous close was 10,069.53. HANG SENG opened at 21,973.98, previous close was 22,347.23. Fund manager at Chibagin Asset Management, Hiroaki Osakabe said “Financial stocks had been gradually rising ahead of earnings reports by their Wall Street peers and that’s why problems in the EU are hurting them a bit more then they would have normally”.

Fear of contagion is not the only reason making investors anxious. Also the current situation of the U.S. economy is frightening investors, especially stalled negotiations over the U.S. debt ceiling. In fact the U.S. hit the debt ceiling on May 16 but since then has used spending and accounting adjustments to continue operating without impact on government obligations. President Barack Obama said “I am prepared to take on significant heat from my party to get something done and I Read more »

Asian stock markets opened higher today on hopes that the Greek parliament will pass the austerity plan. NIKKEI started the day at 9,668.01, previous close was 9,578.31. HANG SENG opened at 22,192.73, previous close was 22,041.77. Investors think that the Nikkei will be capped around 9,700 levels before the markets have a clearer picture on the Greek situation and also profit taking may emerge. Japan Ministry of Economy, Trade and Industry released its latest report today. According to Preliminary Report on the Current Survey of Commerce, retail sales fell 1.3% in May vs 2.6% forecasted.

Asian session is going almost flat. EUR/USD is trading at 1.4294 and trying to break 1.4300 resistance but the volume does not seem to be enough at the moment. Other resistances are located at 1.4349 and 1.4415. Support levels are 1.4225 and 1.4160

GBP/USD is dropping. Since yesterday cable is failing to pass 1.6000 levels. The parity is trading at 1.5975 by the Read more »