EU Morning Report – Disappointing US retail sales fail to meet expectations!
Thursday, July 15th, 2010Disappointing US retail sales fail to meet expectations!
- The USD traded mixed yesterday with the currency initially losing again most majors on speculation the FED maybe dovish in the ensuing FOMC minutes and that a possible discussion on renewing Quantitative easing. However the FOMC minutes did not indicate a bearish Fed with minimal downwards growth projections of 3.5% – 4.2% for 2011. Following the minutes the USD was bid and the EURUSD reversed its daily gains trading back down to 1.2700. From the financial calendar we had a disappointing retail sales failing to meet expectations and printing a 0.5% decline. US equities were flat despite rallying at the open and then trading in negative territory just ahead of the FOMC. Overall USDJPY price action for the day was between 89.10 – 88.00.
- In Europe yesterday we saw the release of the June CPI data which was as expected at 1.4%. Industrial production came in weaker than expected at 0.9% however still indicating growth in manufacturing. Europe’s rescue fund is facing some issues at the moment with Germany’s participation not quite certain as yet. Overall the EURUSD traded in a tight range with large option structures been protected at 1.2750 as well as at 1.2700 leaving the pair to trade in a tight range for most of the day.
Currency to watch out for: EURUSD & USDJPY
- The EURUSD pivot point is at 1.2700 with a preference to enter into Long positions at 1.2710
- The USDJPY pivot point is at 88.40 with a preference to enter Short positions at 88.35
Today’s calendar and market movers:
- US Producer Price Index for June expected to fall by -0.2%
- US Unemployment Claims are estimated to reach 448 thousand
- US Industrial Production for June expected to remain at 0%
- CAD Manufacturing Sales for June to increase by 0.3%
Equity Markets:
- In US equities yesterday the S&P500 closed at -0.02% and the DJIA closed at 0.04%. The European bourses were negative yesterday with the FTSE down -0.33% the DAX and the CAC closing at 0.30% and -0.13% respectively. The NIKKEI and the HSI at the time of writing is -1.11% and -0.28% respectively.
Written by Easy-Forex
