Daily Market News 21 April 2011


Yesterday's Market Movers

  • The only piece of data from euro zone yesterday was from Germany in the form of PPI which saw a slight drop on both the MoM and YoY. These figures did very little to effect to euro as we saw the euro gain against its counterparts on the back of risk appetite with potential strong IBM and Intel earnings boosting risk sentiment.
  • Also adding to euro gains was a successful Spanish bond auction where we saw strong demand for Spanish debt. This saw the euro trade at its highest levels against the US dollar trading at fresh 15 month highs of 1.4547. And giving Spain solid ground for optimism when it comes to their bonds being that many people were talking of possible assisting  when it’s yield on the it’s 10 year bond was well over 5%.
  • In the UK the main piece of data was from the BoE minutes, these figures were released at 6-3 the same as last month and did little to give any clear insight into the BoE interest rate policy. Sterling fell sharply on the back of these figures losing over half a cent against the US dollar trading as lower as 1.6307 before recovery in mid afternoon trade.
  • The United States like the UK and euro zone only had one real piece of data in the way of existing home sales. These came in better than expected and gave some positive data to US after some recent negativity regarding credit rating reviews and worries about the US deficit and national debt.

Today's Market Movers

  • The only piece of data from the euro zone is from the German IFO, where were expecting the figures to come in line with market consensus. Any figures seen better or worse will have effect on the euro being that the IFO measures business conditions in Germany and positive growth.
  • Retail sales are the biggest piece of data from the UK today and are looking for a mixed set of figures on the MoM and YoY figures. These will be keenly watched by investors as retail sales are a leading indicator of consumer spending. If these figures come in better than expected we could see sterling rise against the US dollar and euro.
  • Following the retail sales are the Public Sector Net Borrowing numbers, these are looking for an increase from the month prior which would be seen as negative for sterling as UK debt is increasing. This could leave the door open for possible credit rating agencies to review the UK’s AAA rating as did Moody’s this week in the US leaving sterling open for falls.
  • Initial jobless claims in the United States are only piece of data in the US today; these are looking to come in better than expected on last month’s figure. This could give possible support to US dollar if the numbers are well received as were looking for a decrease of first time claims to fall.