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BetOnMarkets

Discussion in 'Market Predictions and Reports' started by Erik, Oct 28, 2008.

  1. Erik

    Erik BetOnMarkets Representative

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    In the afternoon traders will be paying attention to the US consumer confidence report, which could have the possibility to lift the world wide equity markets out of the recent funk.

    Oil has hit a 17 month low, on speculations that the global financial crisis may slash fuel demand. Oil is down more then 56% since its July 11th peak and it seems that prices are heading lower after OPEC cut oil demand projections for 2009. It seems that the traders that used oil as a hedge against the US economy are now feeling the pain having overlooked the fact that with the world being interconnected, a slowdown in US means a slowdown everywhere else.

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  2. Erik

    Erik BetOnMarkets Representative

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    BetOnMarkets Afternoon Report

    Today the buyers stepped out of the shadows, but yet again the sellers stepped in to push markets off their highs off the day. The FTSE and other world indices are still in positive territory for the day, but a wave of poor economic data has kept a lid on any sustained buying. US house prices are down 16.6% year on year, having slumped over 30% since their peak in 2004. In the face of a continual erosion of the value of their homes and the ever present warnings about the biggest slow down since the great depression, it is little wonder that US consumer confidence figures came out at record levels. Today’s reading of 38.0 is the lowest in the indicator’s history going back to 1967.

    Markets are still extremely jittery as evidence by today’s wild ride on Volkswagen which temporarily became the world’s largest company by market capitalisation, overtaking ExxonMobil for a short while as it rose above 1,000 Euros this morning. Just two days ago, it was trading at 200 Euros. Porche increased their stake in the company to 75%, but the real reason for the huge spike was the squeeze on short traders. Volkswagen has the highest short interest of any stock on the German DAX index. Although shareholders in Volkswagen are rather happy right now,
    today’s spike is more a symptom of the lack of liquidity in today’s
    market place. The German DAX is the best performing index today, largely on the back of the Volkswagen move.

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  3. Erik

    Erik BetOnMarkets Representative

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    BetOnMarkets Afternoon Report

    Today’s US GDP figures hit the headlines, showing that the US economy shrank by 0.3%, the most since 2001. The figure was actually not as drastic as initially expected and as a result, markets have managed to hold on to the morning’s gains. Aside from the market’s reaction to US GSD figures, expectations of a rate cut from the bank of Japan tomorrow has sent Asian markets soaring over the last three days and the rest of the world has been rallying hard with them. The Nikkei is currently up a staggering 26% since Tuesday alone, thought it will have to do the same again and more to recoup the 33% losses since the start of the 3rd quarter.

    In the UK, the energy sector is being pulled in different directions. The previously soaring energy prices helped Royal Dutch Shell to report a better than expected 71% jump in 3Q profits, yet their share price is down around 4% on the day. Investors are less interested in the profits shell has just made, and are more concerned about the prospect of future growth. Judging by today’s share price reaction, investors see much lower profits in the future now oil has turned the corner. On the other hand smaller UK oil services companies such as Petrofac and Amec are performing well today. There is speculation that these support companies might be better able to ride out lower oil prices with their lower cost base and reduced direct exposure to oil prices.

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