News and Media

WEEKLY MARKET RECAP, WEEK AHEAD, AND SCHEDULE
Mandus Invest SA. | 20, January, 2008 / Sunday

The euro depreciated vis-a-vis the U.S. dollar last week as the single currency tested bids around the $1.4590 level and was supported around the $1.4920 level. The pair lost about 150 pips last week. FOMC boss Bernanke reiterated the FOMC is ready to enact “substantive” rate cuts and endorsed a quick fiscal stimulus package. Cleveland Fed’s Pianalto said the U.S. has moved to a “slower growth track.” The Beige Book was not as dire as many expected. Richmond Fed President Lacker said the Fed must also concentrate on headline inflation. Bush unveiled a US$ 145 billion stimulus package.
ECB’s Liesbscher said EMU-13 economic data remain “healthy.” Mersch cited “certain downside risks” to economic growth and intimated the ECB may “look through” oil-induced inflation if other risks don’t emerge. The ECB said base effects may reduce inflation readings in 2008. Weber warned against “overdramatizing” the HICP print of 3.1%. EU finance ministers convene this week. The ECB’s January bank lending survey saw a “sharp Q4 credit tightening.”

Data released in the U.S. last week saw December headline retail sales were off 0.4% with the ex-autos component off 0.4%; December core PPI was up +0.2% m/m and unchanged at 2.0% y/y; the January Empire State manufacturing index weakened to 9.0%; November business inventories were up 0.4%; weekly initial jobless claims were off 21,000 to 301,000; December home construction fell 14.2% m/m; December housing starts were off 38.2% y/y; the January Philly Fed index weakened to -20.9; December headline CPI was up 0.3% m/m and 4.1% y/y and up +0.2% m/m and +2.4% y/y on the core front; December industrial production was unchanged m/m and up 1.5% y/y with capacity utilization lower at 81.4%; November TICS net capital investment rose to US$ 149.9 billion; the mid-January University of Michigan consumer sentiment index improved to 80.5; and December leading economic indicators fell 0.2.

Data released in the eurozone last week saw EMU-13 industrial output fall 0.5% m/m and grow 2.7% y/y; the German ZEW economic expectations index fell to -41.6; and the EMU-13 November trade surplus fell to €2.6 billion.

Last week’s high (1) was above the 76.4% retracement of the 1.4967-1.4309 range and last week’s low (2) was just above the 38.2% retracement of the same range. The 1.4615/ 1.4477/ 1.4812/ 1.4908/ 1.4967/ 1.5030/ 1.5120 levels represent upside resistance targets while the 1.4560/ 1.4404/ 1.4378/ 1.4239 levels represent downside support targets.

CNY

The yen appreciated vis-a-vis the U.S. dollar last week as the greenback tested bids around the Y105.90 level and was capped around the Y108.95 level. The pair lost about 215 pips last week. The Nikkei 225 stock index closed at Y13,861.29. BoJ boss Fukui said the economy “is slowing for the time being but is expected to continue its moderate expansion.” The BoJ is expected to keep the overnight rate unchanged at 0.5% and reduce growth forecasts. Finance minister Nukaga said the economy is “recovering despite some weakness.”
Data released in Japan this week saw December corporate bankruptcies fall 1.7% m/m; November industrial output was off 1.6% m/m; November core private sector machinery orders were off 2.8% m/m; the November current account surplus expanded 2.1% to Y1.78 trillion; the December corporate goods price index rose 2.6% y/y; November average monthly cash earnings increased 0.1% y/y; December department store sales were off 2.3% y/y; and December consumer confidence fell to 38.0.

The Chinese yuan appreciated vis-a-vis the U.S. dollar last week as the greenback closed at CNY 7.2418 in the over-the-counter market, down from CNY 7.2620. PBoC lifted the reserve requirement by 50bps to 15.0%.

Data released in China last week saw December consumer price inflation up 6.5% y/y and December property prices in 70 major Chinese cities were up 10.5% y/y.

Last week’s high (1) was below the 38.2% retracement of the 114.65-105.91 range and last week’s low (2) was below the 23.6% retracement of the same range. Upside resistance targets remain the 107.97/ 108.96/ 109.73/ 110.04/ 111/80/ 112.89 levels while downside support targets remain the 104.19/ 101.67/ 101.20/ 98.65 levels.

£

The British pound appreciated marginally vis-a-vis the U.S. dollar last week as cable tested offers around the US$ 1.9790 level and was supported around the $1.9510 level. The pair gained about 5 pips last week. Above-target CPI could reduce expectations of an MPC rate cut in Q1. MPC’s Gieve foresees inflation “rising well above (the BoE’s 2.0%) target in the coming months…when short-term inflation expectations remains uncomfortably high.”

Data released in the U.K. last week saw December PPI soar 5.0% y/y; November annual house price inflation was at 9.5%; December CPI remained steady at 2.1%; the December claimant count fell 6,400 with the unemployment rate steady at 2.5%; November average earnings were benign at 4.0%; the RICS November house price balance weakened to -49.1; and December retail sales fell 0.4% m/m and were up 2.7% y/y

Last week’s high (1) was below the 61.8% retracement of the 1.9182-2.1159 range and last week’s low (2) was below the 38.2% retracement of the 1.7047-2.1159 range. Upside resistance targets include the 1.9648/ 1.9837/ 1.9937/ 2.0007/ 2.0149 levels while downside support targets include the 1.9182/ 1.9103/ 1.8618 levels.

CHF

The Swiss franc appreciated vis-a-vis the U.S. dollar last week as the greenback tested bids around the CHF 1.0835 level and was capped around the CHF 1.1085 level. The pair lost about 25 pips last week. SNB’s Roth said Swiss GDP may slow on account of lower U.S. consumer spending.

Data released in Switzerland last week saw January ZEW investor sentiment decline to -32.7.

Last week’s high (1) was below the 38.2% retracement of the 1.1594-1.0836 range and last week’s low (2) was below the 23.6% retracement of the same range. Upside resistance targets include the 1.1015/ 1.1052/ 1.1125/ 1.1215/ 1.1304/ 1.1415/ 1.1594 levels while downside support targets include the 1.0740/ 1.0629/ 1.0532 levels.

CAD

The Canadian dollar depreciated vis-a-vis the U.S. dollar last week as the greenback tested offers around the C$ 1.0305 level and was supported around the C$ 1.0125 level. The pair gained about 90 pips last week. Many traders believe BoC will cut rates on Tuesday.

Data released in Canada last week saw November manufacturing sales rise 1.1% m/m.

Last week’s high (1) was below the 50.0% retracement of the 1.1869-0.9055 range and last week’s low (2) was right around the 38.2% retracement of the same range. Upside resistance targets include the 1.0438/ 1.0794/ 1.1204 levels while downside support targets include the 1.0248/ 1.0130/ 0.9966/ 0.9747/ 0.9482/ 0.9300 levels.

AUD

The Australian dollar depreciated vis-a-vis the U.S. dollar last week as the Aussie tested bids around the US$ 0.8700 figure and was capped around the US$ 0.9015 level. The pair lost about 125 pips last week. RBA’s Stevens said he is “not that distressed” by the Aussie’s strength.

Data released in Australia last week saw December ANZ job ads up 7.1% m/m and 31% y/y; December employment fell to 4.3%; December merchandise imports were off 10% to A$ 15.65 billion; January consumer confidence fell 8.3% m/m; November house finance was up 4.0%; the Q4 import price index was up +0.2% q/q; and the November tertiary index was up 0.1% m/m.

Last week’s high (1) was above the 50.0% retracement of the 0.9399-0.8549 range and last week’s low (2) was below the 23.6% retracement of the same range. Upside resistance targets include the 0.8838/ 0.8992/ 0.9062/ 0.9114/ 0.9223/ 0.9340/ 0.9420 levels while downside support targets include the 0.8740/ 0.8549/ 0.8332 levels.

SCHEDULE

Sunday, 20 January 2008
all times GMT
(last release in parentheses)

N/A

Monday, 21 January 2008
all times GMT
(last release in parentheses)

N/A Luxembourg ECB members Papademos and Mersch speak
0001 UK January Rightmove house prices (-3.2% y/y)
0001 UK January Rightmove house prices (4.8% y/y)
0030 Australia Q4 producer price index (1.1% q/q)
0030 Australia Q4 producer price index (2.4% y/y)
0400 Japan Bank of Japan Policy Board meeting
0400 Japan December Tokyo-area condominium sales
0500 Japan November leading economic index (10.0%)
0500 Japan November coincident index (33.3%)
0700 Japan December convenience store sales (-0.5% y/y)
0700 Germany December producer prices (0.8% m/m)
0700 Germany December producer prices (2.5% y/y)
0815 CH December producer and import prices (0.3% m/m)
0815 CH December producer and import prices (3.0% y/y)
0930 UK December public finances (£8.9 billion)
0930 UK December public sector net borrowing (£11.2 billion)
0930 UK December M4 sterling lending (£16.5 billion)
0930 UK December BSA mortgage approvals (£4.533 billion)
1330 Canada November wholesales sales (0/5% m/m)

Tuesday, 22 January 2008
all times GMT
(last release in parentheses)

N/A Japan Bank of Japan interest rate decision
N/A Belgium European Central Bank President Trichet speaks
N/A Belgium European Central Bank member Stark speaks
0500 Japan Supermarket sales (-0.4%)
0600 Japan Bank of Japan monthly report
0600 Japan December machine tool orders (3.3% y/y)
0815 CH November retail sales (2.2% y/y)
1100 UK January CBI quarterly industrial trends
1330 Canada November retail sales (0.1% m/m)
1330 Canada November retail sales, ex-autos (0.0% m/m)
1400 Canada Bank of Canada interest rate decision
1500 US January Richmond Fed manufacturing index (-4)
2330 Australia November Westpac leading index (0.5% m/m)

Wednesday, 23 January 2008
all times GMT
(last release in parentheses)

N/A Austria European Central Bank member Tumpel-Gugerell speaks
0030 Australia Q4 consumer prices (0.7% q/q)
0030 Australia Q4 consumer prices (1.9% y/y)
0745 France December consumer spending (2.4% y/y)
0800 Eurozone European Central Bank member Trichet speaks
0900 Eurozone January PMI, services (53.1)
0900 Eurozone January PMI, manufacturing (52.6)
0930 UK January Bank of England MPC meeting minutes
0930 UK Q4 GDP (0.7% q/q)
0930 UK Q4 GDP (3.3% y/y)
1000 Eurozone November industrial new orders (2.5% m/m)
1000 Eurozone November industrial new orders (10.9% y/y)
1200 US MBA mortgage applications (28.4%)
1330 Canada December leading indicators (0.0% m/m)
2000 NZ RBNZ official cash rate (8.25%)
2300 NZ December PMI (57.2)
2350 Japan December merchandise trade balance (Y791.7 billion)
2350 Japan Equities and bonds investments
2350 Japan November all-industry activity index (1.2%)

Thursday, 24 January 2008
all times GMT
(last release in parentheses)

0200 NZ December credit card spending (9.5% y/y)
0900 Germany January Ifo, business climate (103)
0900 Germany January Ifo, current assessment (108.1)
0900 Germany January Ifo, expectations (98.2)
0930 UK December BBA house purchase loans
1330 US Weekly initial jobless claims (301,000)
1330 US Continuing jobless claims (2.751 million)
1500 US December existing home sales (5.00 million)
1500 US December existing home sales (0.4% m/m)
1620 US U.S. Treasury Secretary Paulson and ECB President Trichet speak
1930 Canada Former Federal Reserve Chairman Greenspan speaks
2300 Australia November leading index (0.9%)
2330 Japan January Tokyo-area CPI (0.4% y/y)
2330 Japan January Tokyo-area CPI, ex-fresh food (0.3% y/y)
2330 Japan January Tokyo-area CPI, ex-fresh food and energy (-0.1% y/y)
2330 Japan December CPI (0.6% y/y)
2330 Japan December CPI, ex-fresh food (0.4% y/y)
2330 Japan December CPI, ex-fresh food and energy (-0.1% y/y)
2350 Japan Bank of Japan December Policy Board meeting minutes

Friday, 25 January 2008
all times GMT
(last release in parentheses)

0700 Germany December import price index (0.7% m/m)
0700 Germany December import price index (3.5% y/y)
0710 Germany February GfK consumer confidence (4.5)
0900 Italy November retail sales (2.3% y/y)
1200 Canada December consumer price index (0.3% m/m)
1200 Canada December consumer price index (2.5% y/y)
1200 Canada December CPI, core (0.0% m/m)
1200 Canada December CPI, core (1.6% y/y)