“We have got an informal signal from Standard & Poor’s that they [European ratings] will come only in January”
– Anonymous government source
Standard & Poor’s is expected to release its verdict on credit ratings for 15 euro zone countries in January, after putting them on credit watch December 6 for a possible cut in the absence of decisive action from European leaders.
“We’ll continue to see [house] prices drop”
– Mark Vitner, a senior economist at Wells Fargo Securities LLC
Economists expect home prices to decline at a slower pace in forthcoming months with prices reaching a bottom in the middle of 2012. Property prices declined 3.2 per cent in October, compared to the same period last year.
“U.S. data is providing what markets have been looking for in terms of a wider economic improvement and rising employment”
– Witold Bahrke, a senior strategist at PFA Pension A/S
U.K. stocks rose on Friday amid better-than-expected economic data from the world’s largest economy. The benchmark FTSE 100 index gained 1.02%, or 55.73 points, to 5,512.70. The FTSE All-Share Index edged higher 0.98%, or 27.48 points, to 2,827.09.
CHF
“Recent positive economic data out of the U.S. have helped revive the markets”
– Manish Singh, head of investment at Crossbridge Capital
Swiss stocks closed higher on Friday amid hopes the U.S. economy is g aining steam. The Swiss blue-chip index SMI, a measure of the largest and most actively traded companies, rose 0.97%, or 56.83 points, to 5,893.89. The broader Swiss Performance Index edged higher 0.90%, or 47.13 points, to 5,308.95.
JPY
“The U.S. economic data is not bad on the whole”
– Yoshinori Nagano, a senior strategist in Tokyo at Daiwa Asset Management Co.
Japanese stocks edged higher on Monday after the U.S. Congress passed payroll tax extension. The Nikkei 225 gained 1.00%, or 84.18 points, to 8,479.34, while the broader Topix advanced 0.46%, or 3.32, to 726.44.
“The ECB will surely have to launch QE at some point. I suspect it might be sooner, rather than later”
– Jefferies (based on CNBC)
From above the currency pair is capped by resistances located at 1.3118, 1.3160/96 and 1.3281, the latter being a key one. Since the outlook remains bearish for the price, the focus is on supports at 1.3053, 1.2947 and 1.2873.
“Japan’s economy is still reliant on exports, so the yen’s appreciation has direct impact over employment, too”
– Institute for International Monetary Affairs (based on Bloomberg)
Even though the current bias for EUR/JPY is rather bearish, a close above 102.48 could invoke a bullish movement that may extend up to 104.00/95, while a tough support area situated at 100.74/00 should prevent the pair from going lower.
“Don’t count on another round of BoE QE in February”
– WSJ
For the moment the pair is directionless, while its movement is being restrained by the boundaries of a 1.5778 – 1.5407 corridor. The initial resistance and support lines are at 1.5650 and at 1.5580, respectively.
“The greenback often trades in volatile way against the yen during the last three business days of the year”
– CNBC
The short term support is at 77.50, ahead of 77.12, while resistances may be found at 78.20/50 and 79.52. In case USD/JPY reaches a record low at 75.56 it is likely to rebound from this level and recover.
“The dollar tends to be sold in the risk-on environment”
– IG Markets Securities Ltd. (based on Bloomberg)
In order to reignite bullish momentum and surge up to 0.9500/46 the currency pair has to penetrate resistance at 0.9400. Dips, however, should be limited by support lines located at 0.9320, 0.9200 and 0.9170.
The euro: Still in casualty
It is a measure of the depth of the eurozone crisis that it is now identified as one of the defining stories of 2011, taking its place next to the Arab Spring.
U.S. stores hope “Mega Monday” led to brisk sales
Shoppers found a mixed bag of bargains and so-so deals on Monday, as a day off for many Americans lured some out for what was likely to be the third-busiest shopping day of the holiday season.
China to ease bank reserves soon, analysts say
Speculation is mounting that Beijing will further cut bank reserve requirement ratios, as inflationary pressure is easing while overall growth in the economy is slowing.