Thursday, June 14, 2012

3 Things to Know Before Trading

3 Things to Know Before TradingNorthern, WI 6/14/12 (StreetBeat) -- Stocks were mostly lower in Asian trade. The Hang Seng fell 1.15%, Shanghai lost one percent, Australia slipped a half percent and the Nikkei was down a slight fraction. European indexes are generally lower this morning, with the Footsie off 0.9%and the Dax down about three quarters percent. US stock futures are just slightly higher as I write.

*The final April reading of Japan’s Industrial Production was revised from +0.2% to -0.2% on a month on month basis.

*Italy sold EU4.5 billion bonds this morning, the maximum amount they had intended to sell, but they paid a price to do it as yields were significantly higher on this mid curve debt than at the previous sales.

*Spain’s debt was downgraded to one notch above junk status yesterday afternoon. At one point this morning the yield on their 10 Year bonds rose more than thirty basis points to over seven percent. The Bank of Spain reports that Spain’s banks’ ECB borrowings rose to a record EU288 billion in May, up from EU263 billion the month before and EU119 billion in December.

*The May reading of Germany’s Wholesale Price Index is -0.7% month on month.

*The Swiss National Bank didn’t touch their key interest rate at their policy meeting this morning, but they did reinforce their commitment to the Franc ceiling of 1.2000 versus the euro. They stand ready to buy unlimited quantities of foreign currencies in order to maintain their Swissie cap, and they say they will take further measures to do it if need be. The bottom line, they “will not tolerate” any further gains for their currency. Oh, but the market did not wobble the least bit and the Euro/Swiss remains closerthanthis to the 1.2000 ceiling.

*Three bits of data are due out at 7:30am CDT, including: the weekly report on Initial Jobless Claims, expected to be 375k; the May reading of the headline Consumer Price Index is forecast to be -0.2% on a monthly basis and +0.2% for the Core on that basis, the annualized rates are expected to be +1.8% and +2.2% respectively; and the Q1 reading of the Current Account Balance, estimated to be a deficit of $131.9 billion.

*The weekly report on inventories of Natural Gas is due out at 9:30am CDT; it is expected to show an increase of 75 bcf.

*The Fed is scheduled to buy Treasuries today that are due to mature between 2/15/36 and 5/15/42; the results of the operation will be announced just after 10:00am CDT.

*The Treasury plans to sell $13 billion re-opened 30 Year Bonds today; the auction results will be announced just after noon CDT.

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