BetOnMarkets Market Reports

[Erik]

The FTSE is down around 1%, but the real loser today is UK PLC. The pound is crashing as various factors come to a head. Up until July, the US Dollar was the currency the world loved to hate, now it’s sterling’s turn to be punished. Today’s Bank Of England inflation report was more dovish than expected, opening the doors to possible interest rate cuts before the year is out. This coupled with a housing market that has fallen through the roof has pushed Sterling down 1.11% against the Euro, 1.3% against the Dollar and 1.84% against the Yen today alone.

Stocks are not immune from the general stampede out UK securities. The financial sector is once again under pressure and without the FTSE’s other major sector firing on all cylinders (oil), the index is showing weakness where it counts. It has recently been reported that global bank’s losses & writedowns from the credit crunch have exceeded the $500bn marker. To add to the gloom, New York University economist Nouriel Roubini has recently estimated that this figure could double before the crisis is over.

 

[Erik]

The FTSE is currently indicating a higher open as traders are anticipating that the economic news from its main trading partner, European Union, comes out better then expected. Today around the same time the FTSE opens for trade, the European Union will be releasing its GDP results for the 2nd quarter. Analysts are excepting for a contraction of 0.2%, however we have heard rumours that there is a chance that the number will come out much higher. Should this happen we could see the FTSE close up more then 100 points

Gold is benefiting from bottom buying. Some traders are hoping that the recent US dollar strength is over done and that gold is poised for a jump back up to 900 dollars per ounce.
Oil benefited yesterday from the bullish inventory numbers, however the overall down trend should resume today and we could retest the 114 dollar level.

 

[Erik]

BetOnMarkets Morning Report

The FTSE is currently indicating a lower opening as traders await the release of the UK retail sales numbers. While economists are expecting a contraction of 0.2%, traders are hedging in case the numbers come out worse then expected. Should this happen, the FTSE could open 1% lower.

Gold is in recovery mode as the strength of the US dollar wanes. Gold is now trading above the 820 dollar per ounce mark, and is poised to go higher. Oil had a very interesting day; after bearish inventory data, which saw crude oil fall below the 114 dollar mark, the black gold recovered and coupled with the weakness of the US equities market, finished the day above the 116 dollar per barrel mark. We expect oil to follow the US dollar, if the dollar weakens then look for oil to test 120 dollar level.

 

[Erik]

BetOnMarkets Afternoon Report

Markets are on edge with both bulls and bears frustrated and unwilling to take on big positions. There are two big unknowns, the first is the continuing political crisis between Russia and NATO countries. The focus has now shifted from Georgia to the proposed missile defence battery to be located in Poland. The longer this goes on without constructive dialogue from either party, the more nervous investors become. As testament to investors growing unease, oil prices have finally started to move higher, a significant development considering the recent ambivalence seen in crude prices. Russia is vying with Saudia Arabia to become the worlds top oil producer.

Secondly, the specifics of the expected US government bailout of the GSEs Fannie Mae and Freddie Mac are still unknown. With billions, potentially trillions at stake for the US government and US tax payers, equity and bond traders alike are wary of taking on large positions. Financials are therefore underperforming again today, while gold and oil bounce back from their recent dips.

 

[Erik]

BetOnMarkets Afternoon Report

European markets opened on the back foot, this morning due to the sustained sell off on Wall Street last night. The FTSE has struggled to catch up after the Bank Holiday day off and judging by the volume of today’s trading activity, many traders may have taken the chance for an extended holiday.

US markets are mildly positive after better than expected new home sales data. The S&P Case-Schiller house price index fell less than expected for the second quarter, but indicates that US house prices are still down 15.9% year on year. On a more positive note, housing futures based on the Case-Schiller index bottomed at the end of June and have been rising since. Expectations are for lower levels still, but the these levels are now thought to be better than those predicted a few months ago. However, it is too early to say for sure that this heralds the start of the start of the much vaunted turnaround in US house prices. Interest-rate futures are currently implying that banks are again becoming hesitant to lend to each other on fears that credit losses will increase as the feared global recession kicks in. Increased lending rates will hardly be manna from heaven for home owners on either side of the Atlantic.

 

[Erik]

BetOnMarkets Morning Report

The FTSE currently indicates a flat open, as there is no economic data to help the traders determine where the FTSE is headed next. Today's trading could be influenced by the data that is released in Europe and US, especially the European consumer confidence report. Look for a quiet day, as most traders are going to be taking off early to enjoy the last weekend of summer.

Oil traders felt like they just took a rollercoaster ride yesterday. Oil finished down almost 3 dollars per barrel and at one point was trading below the 115 dollar mark. We suggest for traders to stay out of the oil market until after the weekend, as hurricane Gustav is unpredictable.

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[Erik]

BetOnMarkets Morning Report

The FTSE is currently indicates a lower open as traders await the release economic data regarding the state of the UK banking sector. Economists are wondering how well this sector is doing, especially the mortgage industry. An increase in approved loans could signal that the banking industry is once again ready to lend money to the public.

Oil should be front and center as Hurricane Gustav makes landfall around the time London closes for the day. There are rumors that Hurricane Gustav is going to hit the oil producing area of the Gulf of Mexico. This could result in the price of oil retesting the record price set earlier this year.

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[Erik]

BetOnMarkets Morning Report

The FTSE currently indicates a flat opening as traders wait to see what the Bank of England decides before putting money into the equities market. The BOE finds it self again at a cross roads, trying to decide which fire is more dangerous, inflation or an economy on the brink of a recession. I would not want to have that job today.

Oil finally broke below the 200 day moving average and is technically in a free fall until the 100 dollar per barrel mark. Due to the shortened week in US, the inventory numbers will be released today instead of Wednesday, this release should have a significant effect on the price of oil today. Gold keeps trading lower as renewed optimism regarding the US economy has traders selling gold and buying the US dollar. Look for the very important employment figures today around lunch, which will give you a hint regarding tomorrows all important employment rate for US. Strong numbers could possibly send gold below 800 dollars per ounce.

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[Erik]

BetOnMarkets Morning Report

The FTSE is currently indicating a lower opening although there is no UK economic data today, the FTSE will be influenced by the release of the US employment numbers. Analysts are expecting a loss of 75 thousand jobs, after studying the economic reports we believe, that number is too optimistic. If the employment data comes out soft, watch for the FTSE and all the other major stock exchanges to finish the day deep in the red.

Oil has continued its free fall and a lot of it can be credited to the latest wave of strong US dollar sentiment. With the GBP/USD now trading below 1.80 dollar mark, the US dollar has appreciated by more then 10% in the last 4 weeks. Traders will be analyzing today's employment data very carefully, to see if the recovery was warranted.

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[Erik]

BetOnMarkets Morning Report

The FTSE currently indicates a flat opening, as traders await the release of the UK Industrial and Manufacturing production numbers. While analysts expect flat growth for the month of July, we feel that the number is a little optimistic resulting in the market possibly opening lower this morning.

Oil prices are trading lower, as another hurricane is slated to miss the key oil producing fields. Adding to the lower oil price is the resurgence in the strength of the US dollar, which traded at an 11 month high versus the Euro. We might see the Euro trade as low as 1.35 per US dollar this month.

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