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Global Market Wrap: Stocks Go up On Japanese GDP Equity Futures: Dow +62.00. S&P +8.20. NASDAQ +8.75. Japanese Nikkei +32.00. German Dax +11.00. European Trade: European markets opened the Monday trading session with very robust momentum, following the much better than expected Japanese GDP statement and APEC’s guarantee to sustain the financial stimulus. The boldness seen in Asian trade, where the markets inverted preliminary losses, allowed a risk aversion wave to sweep into the overnight session. European Equity markets saw optimistic momentum from the opening bell. All area stock markets are presently trading in the green, with the leaders is led by Norway’s OBX, which advanced 2.20%. The heavyweight German Dax and U.K. FTSE gained in the order of 1% in Monday trade, while in Emerging Europe, Poland’s Wig Index gained 2.10%. The European equity market was pressed higher on the back of Asian market momentum that followed very strong Japanese GDP numbers. In the third quarter, the Japanese market expanded 1.2%, defeating market’s expectations of a 0.7% read. The increase rate of the Japanese economy is stronger than the one seen in Europe or U.S., even though the market had been pricing in a slow Japanese renewal. Further positive momentum came from the Asia-Pacific Economic Cooperation (APEC) conference, where the key economies in the Asian region vowed to sustain the stimulus programs, echoing the G20’s proclamation made earlier this month. Sector Moves: The vast bulk of the gains in European trade came from the basic resources sector, which surged 3% after gold achieved a new record high during the session. This was reflected in the U.K.’s FTSE, where miners have a vital weighting in the market. As such, the six top gainers in the FTSE 100 index came from the mining sector, with Lonmin jumping 7.85%. Also in the U.K. index, Rolls-Royce jumped 3.20% after it managed to secure a £1.5 billion pound contract with Air China. Since the beginning of the year Rolls-Royce has frequently returned higher yields than the FTSE index. In the German Dax, ThyssenKrupp advanced 3.0%, being the second greatest gainer in the index after Infineon. ThyssenKrupp jumped after it was upgraded by JPMogan to “overweight”. Economic Moves: The only notable macroeconomic report seen during the European session was the euro-area CPI, which came in at a -0.1% read from one year earlier. Ahead, investors prepare for the U.S. retail sales numbers and for the Empire State Manufacturing Index, which will probably have an important impact on the market. Both reports are scheduled at 08:30 EST. Crude oil was just trading at $77.35 per barrel, higher by $1.00. Currency Pair Overview: Positive Equities, And The Dollar Holds On In general, after a optimistic Asian equity trading session, in which the dollar index was pushed to a new low, the currency market began retracing right through the morning European trade. Interestingly, this is happening on a day that equity markets are trading deep in the green, something that does not occur very often. The recent pattern has been that stock markets trade higher, which pulls the dollar down. Over the last two weeks of trading the exchange market saw a universal lack of momentum and volume, which typically appears near the end of an uptrend, signaling that the market needs a short-term retracement of the dollar selling. The currency market is trading in an overbought state in opposition to the dollar. The euro (Eur/Usd 1.4960) rose up to the 1.5000 area during the Asian session, but soon after the pair started to retrace the pips gained previous in the session. Right now, the euro is trading in the 1.4960 area, just above TheLFB Resistance 1. During the European session, the market absorbed Euro-zone CPI numbers, but they had little consequence. The pound (Gbp/Usd 1.6670) tested the 1.6740 area during the European session, but failed to break higher. In this vicinity, the pair met a opposition trend-line that has held for about a week. In order to expand its current uptrend, it is essential for the pound to break above this price-point. To the downside, the 1.6600 area might act as an essential swing point. The aussie (Aud/Usd 0.9325) had a array of only 35-pips since the day started, even though the other major pairs saw higher momentum. Over the new periods of trade, the aussie has moved on feeble momentum, something that might be interpreted as unhelpful in the short to medium term. The cad (Usd/Cad 1.0480) is presently trading below TheLFB Support 1 area (1.0465), after the pair declined roughly 50 pips on the day. On the daily chart, the cad is trading below the central moving averages, but the trading volumes have been in a continual decline lately. The swissy (Usd/Chf 1.0090) continues to mock the 1.0050 area, but once again has failed to push lower during the nightly session. A move underneath this level will come only on positive equity markets and broad dollar weakness, something that has yet to happen. The yen (Usd/Jpy 89.45) spent the nightly session consolidating in the 89.50 area, which is the lowest value it touched in a month. A break below this price point will most likely lead the yen towards the 88.50 and then towards the 87.00 areas.
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