EU Morning Report – US Non Farm Payrolls expected at -110K!
Friday, July 2nd, 2010US Non Farm Payrolls expected at -110K!
The dollar weakened across the board yesterday as global growth concerns were in the limelight ahead of today’s NFP report. Manufacturing ISM disappointed by dropping to 56.2 pending home sales fell by 30%, construction spending down by -0.2% and we also had an increase in initial jobless claims to 472K. Overall rate hike expectations have been pushed out to 2011 and the USD has lost its safe haven status to the JPY. Today the market is focusing on payrolls with an expectation of -110k jobs been lost. USDJPY price action yesterday was between 1.2200 – 1.2540.
In Europe we saw some positive bond auctions from France and Spain and an ECB 6 day tender of Eur 112 bio to 78 EU banks as a bridge loan so as to roll over future debt maturities. Economic data has remained relatively stable in the EU with Manufacturing PMI coming in line with expectations at 55.6. Overall price action for the EURUSD was very strong as the combination of successful bond auctions by member states, and the weak economic data from the US push the EURUSD to 1.2540 as a bout of short covering took hold and short term specs could not help themselves from adding to the momentum.
Currency to watch out for: EURUSD & USDJPY
- § The EURUSD pivot point is at 1.2450 with a preference to enter into Long positions at 1.2460
- § The USDJPY pivot point is at 88.25 with a preference to enter Short positions at 88.20
Today’s calendar and market movers:
- § Eurozone Unemployment rate for May expected at 10.1%
- § US Unemployment rate for June expected at 9.8%
- § Non Farm payrolls for June expected at -110K
Equity Markets:
US equities closed negative yesterday with the S&P500 down by -0.32% and the DJIA down by -0.42%. The European bourses were negative yesterday with the FTSE down -2.29% the DAX and the CAC closing at -1.81% and -2.99% respectively. The NIKKEI and the HSI at the time of writing is 0.13% and -1.38% respectively.
Written by Easy-Forex
