Oil falls below $100

Crude extends decline to near $99 a barrel on increase in U.S. crude supplies.

SINGAPORE (AP) -- Oil prices fell further Thursday after dropping by more than a dollar in the previous session on larger-than-expected increases in U.S. crude and gasoline supplies.

Prices remained supported near Tuesday's record close of $100.88 a barrel as the U.S. dollar tumbled to fresh lows against the euro and worries about the American economy drove more money into energy futures as a hedge against inflation.

The report by the U.S. Energy Department's Energy Information Administration showed that country's crude oil inventories rose by 3.2 million barrels, or 1%, to 308.5 million barrels.

Although that number is slightly lower than levels a year ago, it is well ahead of the 2.4 million barrel gain analysts had been expecting, according to a survey by Dow Jones Newswires. It was the seventh straight week the report showed a rise in crude inventories, suggesting the U.S. at least has more than enough oil to meet demand.

Light, sweet crude for April delivery lost 36 cents to $99.28 a barrel in Asian electronic trading on the New York Mercantile Exchange, late afternoon in Singapore.

The contract fell $1.24 to settle at $99.64 a barrel Wednesday after surging as high as $102.08 a barrel, a trading record. On Tuesday, the contract jumped $1.65 to settle at a record $100.88 a barrel.

The EIA data showed gasoline inventories also jumped more than expected -- by 2.3 million barrels to 232.6 million barrels; analysts had expected a more modest rise of 400,000 barrels. Refinery activity also increased much more than expected.

The weakening U.S. dollar also helped prop up prices. The 15-nation euro jumped to a record $1.51 against the greenback, meaning that crude remains a relative bargain for buyers overseas. Gold - another commodity seen as a hedge against inflation - also struck a record Wednesday.

In his testimony to the U.S. Congress Wednesday, Federal Reserve Chairman Ben Bernanke warned of sluggish business growth ahead, and signaled a willingness by the central bank to cut interest rates again. But Bernanke also noted that the Fed must keep a close watch on inflation given the sharp rise in energy prices and other costs.

Heating oil futures lost 1.16 cents to $2.7595 a gallon while gasoline futures dropped 2.12 cents to $2.4565 a gallon.

Natural gas futures advanced 3.8 cents to $9.098 per 1,000 cubic feet.

Brent crude rose 31 cents to $97.96 a barrel on the ICE Futures exchange in London.

House approves $18B in oil taxes

Bush to veto bill rolling back tax breaks for oil

Stockholm shares slightly lower midmorning hit by weak US dollar

Shares were slightly lower in midmorning trade on profit taking following yesterday's weak US data and on concerns after the US dollar fell to 15 year lows against the Swedish krona.

At 10.50 am, the OMX Stockholm index was down 0.38 pct at 323.08 points, while the OMX Stockholm 30 was 0.48 pct lower at 975.37 points. Turnover amounted to 4.588 bln skr.

Big exporting companies exposed to the dollar were among the biggest losers, with Volvo B down 1.31 pct at 94.25, Electrolux B down 2.12 pct at 103.75, Ericsson (NASDAQ:ERICY) B down 0.80 pct at 13.65, and Atlas Copco A down 1.73 pct at 99.25.

Handelsbanken A was up 0.28 pct at 177.00 skr after its sharp fall yesterday. Keefe, Bruyette & Woods (KBW) downgraded shares in the bank to 'underperform' and slashed its 2008 and 2009 EPS estimates by 6 pct and 10 pct respectively, following the bank's weaker-than-expected fourth quarter results.

'Handelsbanken reported a weak Q4 result, missing consensus on the net interest income, fee and cost line by 1 pct, 3 pct and 9 pct. We are particularly concerned with the cost development which has previously been SHB's strongest card,' said KBW.

Among the other banks, Nordea was down 0.85 pct at 93.70, Swedbank A down 1.14 pct at 173.50, and Skandinaviska Enskilda Banken A down 0.93 pct at 159.50.

TeliaSonera (PINKSHEETS:TLSNF) was outperforming, up 1.43 pct at 49.50, after Dagens Industri reported the company's CEO Lars Nyberg is in discussions with Russian telecom investment company Altimo over a possible deal.

Scania B was down 0.63 pct at 157.00. Scania's Martin Lundstedt seen as likely successor to Leif Ostling as CEO of company reported Dagens Industri.

Hennes & Mauritz B was down 0.85 pct at 351.00. Swedish retail sales increased 4.8 pct in December from a year earlier, the Central Statistical Bureau reported. Market expectation was for a rise of 6.6 pct, according to a survey by SME Direkt.

Elsewhere in the market, Sandvik was down 0.23 pct at 106.25, Tele2 B down 0.92 pct at 107.75, and SCA B down 1.47 pct at 100.50.

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The copying, republication or redistribution of Thomson Financial News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Financial News.

Euro Holds 1.5100 As Data Continues to Shine, Where is the Top?

Talking Points

• Japanese Yen: Bounces to 106.50
• Euro: Holds 151.00 as labor retail data prove supportive
• Pound: No event risk today
• Swiss Franc: employment expands for 11th quarter in a row
• US Dollar: GDP on tap

EURUSD made itself comfortable at its new home above the 1.5000 level, holding on to the 1.5100 figure for most of the night. The news out of the EZ continued to be constructive as both labor data and Retail PMI numbers demonstrated that the underlying fundamentals in the 15 member region remain sound.

German unemployment declined more than expected dropping by -75K from -48K forecast, as EZ largest economy continued to expand. More importantly German Retail PMI readings recovered from their sharp drop last month of 44.2 to end up above the 50 boom/bust level once again printing at 52.1. Overall, the EZ Retail PMI numbers stood at 52.4 – comfortably in expansion territory.

The overnight economic news goes a long way towards explaining ECB’s rather sanguine attitude towards growth. With labor markets continuing to generate jobs and with consumer demand in the region relatively healthy, ECB sees little need to lower rates anytime soon. As we’ve noted before, as long as EZ employment environment remains supportive, the ECB will have all the political protection it needs to maintain its hawkish policy.

Nevertheless, with EURUSD trading at such lofty highs the pair is overbought on a short term basis, as popular sentiment has clearly shifted to the euro. When the demise of the dollar becomes the top story on the Drudge report, a near term top in the EURUSD is not far behind. Yet any retrace in the pair is likely to be corrective and short lived. For the time being the fundamental story stands squarely on the side of euro bulls and if US data shows no signs of improvement, the pair could easily move higher after a short term pause.

To that end, today’s US GDP numbers could provide some fireworks in today’s North American session. The market expects an upward revision to 0.8% - still a paltry rate of growth - but slightly better than the initial 0.6% read. If the data surprises to the upside, it may quell some of the doom and gloom forecasts of an imminent recession that dogged the greenback. If, however, the news is even worse than the bears believe, the greenback could come under fresh selling pressure stoking fears that the recession is already here as EURUSD will continue its dally journey to new highs.

After 1.50, what’s next for the Euro?

Forex Report with FMCI Update by Forex Metrics - Feb.28/2008

Forex Report with FMCI Update by Forex Metrics - Feb.28/2008

FMCI is down by 54 pips to 1.2210 level with 4 out of 10 currencies up.

Today, after the US economic data release, FMCI dropped substantially due to the fear of recession gripping the global economy. Although Euro was high against USD and Pound, the overall global trend shows sign of economic slowdown.

FMCI reflects the current trend of global economies as a whole, from the value of major global currencies. Fall in FMCI indicates a global slowdown.

Economic data released on Feb/27 was negative for US.

* US Durable Goods Orders m/m fell -5.3% confirming reduction in consumer durable goods buying power.
Core Durable Goods Orders fell -1.6% m/m.
New Home Sales dropped to 588K, again showing no sign of recovery.
USD Crude Oil Inventories dropped to 3.2M and oil prices shot above $100 a barrel pushing inflationary pressure upward.

Finally, Bernanke acknowledged inflation risks but said “it is important to recognize that downside risks to growth remain.”
All these factors accelerate dollar its Record Breaking Declines. Also, Fed clearly indicates substantial interest rate cut which will increase interest rate gap between major economies.

* Germany figures were consistent with expectation, which made EU outlook positive and gave a boost to EURO to an all time high against USD.

* The UK GDP rose 0.6% q/q and 2.9% y/y in Q4 of 2007, which is considered positive, but not strong enough. Value of pound is at a level where exports may remain stable.

US recession fear is for real and interest rate cut at measured pace will only support growth, as any substantial cut will not help the economy. It appears that fed is under panic situation and more concerned about depression than recession.

Whereas Euro is not acknowledging the global slow down, which may be affecting EU in other half of 2008.

Trading with caution is recommended, as the only factor that is consistent globally today is, Change.

Major currencies were overall trending upwards with exception of USD.

Forex Report with FMCI Update by Forex Metrics - Feb.26/2008

Forex Report with FMCI Update by Forex Metrics - Feb.26/2008

FMCI shot up by 110 pips to 1.2245 level with 9 out of 10 currencies up.

Today, FMCI rose substantially with a relatively positive economic data. Major currencies were volatile in upward direction.

Economic data released on Feb/25 was positive in a way for US and UK.

* US existing-home sales fell a less-than-expected by 0.4% on m/m to a 4.89 million annual rate in January. This catalist signifies the possibility of avoiding recession and gave boost to USD, although there was negative news, that inventories of homes available for sale increased 5.5% at the end of January to 4.19 million.

* UK house prices fell 0.2% m/m in February, pushing annual house price inflation to a 22-month low, showing a sign of economic slowdown. Bank of England’s Monetary Policy Committee member Kate Barker commented “Recession remains outside the main possibilities….We have got this combination of shocks coming from abroad and it’s difficult….We certainly expect a period of greater volatility this year,” Definitely inflation is under check and cut in interest rate would be a suitable move for boosting the economic growth.
Major currencies were overall trending upwards, but still range bound.

Weekly Forex Update - Week09 : Feb.24/08 - Mar.01/08

Weekly Forex Update - Week09 : Feb.24/08 - Mar.01/08

ForexMetrics Currency Index (FMCI)

Last week FMCI was stable and consistent above 1.2100 level. Since FMCI is stable, major currencies do not have a definite direction as yet due to uncertainty on global economic slow down. Stable FMCI indicates that major currency pairs may remain range bound, which is suitable for conservative trader. Please be advised that we do not recommend forex trading, as FMI works on its own strategy of “TradeVestment”. For our trading strategy and techniques, range bound currency pairs are most favorable.

Monitor FMCI for fundamental economic analysis and daily report, before trading.
USD

US data definitely points towards continuing slow down of economy but at a reducing rate, as impact of rate cuts starts percolating towards grass root level. Reason for slowdown is liquidity crunch impacting housing sector and the ripple effect has slowed down consumer durables and automobile sector. The basic issue that US faces today is unavailability of cheap liquidity and this cannot be solved just by cutting interest level. US economy is currently under catch 22 situation. If Interest rate drops down to 2% in next 2 quarters, it may be a boost to economic growth but, drop in interest rate is causing inflationary pressure which may even out economic growth in short run.

Federal bank has to be very vigilant in deciding interest rate and has to balance inflation and growth. Bernanke’s decision would be very critical from now onwards, as 50 bps cut, which is widely expected, may not only boost growth, but increase inflation and inflationary pressure at all levels. This may lead US economy to stagflation, which would be undesirable.

Due to political pressure, coming election and external global factors, federal bank appears to be all set to cut more interest rate, as they may not have patience to wait till impact of rate cuts percolate deep into economy, which would be atleast 2 quarters. FMI-Team views that, the balancing act to boost growth and control inflation in current situation, can be performed only by holding interest rates and gradually cutting interest rate at measured pace depending on economic global data.

USD, during recession, may not necessarily get weaker as other economies, as US still contributes to 28% of global business.

What would make USD weaker is not recession or slow economic growth, but high rate of inflation. Currently, we view USD as range bound with majors only because USD is highly dependent on economic data and interest rate decision. Any more drastic cut may lead US to stagflation and USD may change its trend from Neutral to Downward.

European Union (Euro)

Last week, European Union data was kind of soft as the central bank has viewed inflation pressure reducing in next quarter and also forecasting a slower economic growth rate, but is not concerned about recession. We totally agree with this view as these subtle comments make us believe that EU central bank will try to hold interest rate as long as it is possible based on economic data.

There is nothing wrong with this view. However, in our opinion, EU central bank should cut its interest by 25 bps, only in the event of US federal cut as a preemptive move. The reason being to keep EU growth rate stable and well above inflation rate.

We see Euro as range bound currently, but any further increase in interest rate gap between US and UK, may lead to strengthening of EURO. Not good for economy specially in global slow down.

Sell Euro on strength.

Expected EUR/USD Range : 1.4887 to 1.4502

British Pound (GBP)

UK economic growth has been diminishing and inflation is stable. Sustaining growth rate at current interest rate level is tough. Expect interest rate cuts. Delay in interest rate cut by 25 bps may cause substantial slow down in British economy. This is with the view in mind, that liquidity crunch and expensive cost of borrowing will cause a ripple effect in slowing down economic growth.

Sell Cable against USD on strength.

Expected GBP/USD Range : 1.9892 to 1.9383
Expected EUR/GBP Range : 0.7569 to 0.7393

Conclusion:

Economic data from US, UK and EU was weak last week.

Euro will stay strong against USD and Cable.

USD may consolidate and shall remain range bound.

Pound may get stronger against USD and Euro.

6 Gold and Mining Stocks to Watch

Even with the market in a frenzy, gold is still in demand. Especially now that the Feds cut rates by 75bp, you can expect the trend to continue. I have claimed GLD to be my true love in the past because of its supreme run, and this is just one example of a solid play on gold.

With that said, here are 6 different stocks that are involved in gold, or gold and silver mining that should be on your watch close watch list.

Goldcorp, GG Stock is looking quite juicy right now at just above $35 a share, with the stock hitting a high last week of $39.94. If the 50 day moving average can start to uptrend again, watch out. As of this post GG stock rests at $35.06.

GG Stock Chart, Click to View

Barrick Gold Corp, ABX stock has strong exposure internationally and mines gold alongside copper. The stock has found fantastic support recently at $45 which has to have the bulls happy, and is seeing short term resistance around $50. As of this post ABX stock is trading at a last of $48.10.

ABX Stock Chart, Click to View

Randgold Resources, GOLD stock is a play on gold in Africa. The stock has had a fantastic run since early September running from $25 all the way to $45, and as of this post lies at $43.27.

GOLD Stock Chart, Click to View

Kinross Gold, KGC stock has moved nicely as well since early September, and just yesterday the stock found great support at $19 and its 50 day moving average. KGC is a buy above $21.50 and easily has potential to move up to $25 if Gold stocks overall continue to press higher. As of this post KFC sits at $20.20

KGC Stock Chart, Click to View

Buenaventura Comp, BVN stock has seemed to find support at its 50 day moving average, but has fallen under key support area $60 which makes me skeptical. Last week the stock peaked out near $71, and as of this post is at a last of $58.32.

BVN Stock Chart, Click to View

Last but not least everyone has to know about the Streettracks Gold Trust, GLD ETF. $86 is the key level here for the bulls and this ETF has been a favorite since it was trading in the low $70s. Look for intraday resistance between $88 and $90. GLD as of this post is at a last of $87.89.

GLD ETF Chart, Click to View

Philippine stock market lost 9% in January 2008

If you placed money in the Philippine stock market from the beginning of January this year, you would have already lost 9% by now. That translates to a million pesos worth only P910,000 as of January 31.

That is based on the performance of the Philippine Stock Exchange index (PSEi), a basket of 30 listed common stocks representing the overall movement of market prices and the general state of the Philippine economy.

On January 31, the PSEi closed at 3,294.08, down 9.04% compared to its original level at the start of the year. Badly hit were the Mining and Oil sector which lost 15.12% and the Holding Firms sector which declined in value by 14.74%.

The PSEi lost 9% of its value in January 2008 alone.

Calculating FOREX Profits and Losses

FOREX currencies are traded in much smaller divisions than cash. Whereas the smallest division in US cash is the penny ($0.01), US currency can be traded on the FOREX in divisions of $0.0001. This smallest division is called the pip (short for Price Interest Point - sometimes just called 'points'). Since currencies are traded in large lots of (say) $100,000 - small movements in value can generate substantial profits and losses. In a lot of US$100,000 one pip is worth $10 so an increase in 40 pips (4/10 of one cent) can generate a profit or loss of $400.

Currencies are traded in lots of various sizes. The standard lot is 100,000 units of the base currency. A unit is the currency name e.g. one unit of US dollars is the dollar. So a standard lot of US currency is worth $100,000. FOREX trades can have lots of various sizes - a mini lot is 10,000 units, but the most trades are done using standard lots.

Various currencies have different sized pips. The US dollar is expressed in pips of 0.0001 while the Japanese yen is expressed in pips of 0.01. The value of a pip depends on the size of a lot and the currency pair traded. Currency pairs with USD as the quote (second) currency (e.g. CAD/USD) always have a pip value of $10 per standard lot or $1 per mini lot. A pip value calculator can be used to calculate other currencies.

Order Types

A trader has at his disposal different types of orders to make FOREX trades. A clear understanding of each type of order is necessary to be a successful FOREX trader.

Market Order - is an order to buy or sell at the current market price. They can be used to enter or exit a trade. Market orders should be used with care because in fast-moving markets there may be a difference between the price seen at the time a market order is given and the actual price of the transaction. This is due to slippage - the amount the market moves in the few seconds between giving an order and having it executed. Slippage could result in a loss or gain of several pips.

Limit Order - is an order to buy or sell at a certain limit. They can be used to buy currency below the market price or sell currency above the market price. When buying, your order is executed when the market falls to your limit order price. When selling, your order is executed when the market rises to your limit order price. There is no slippage with limit orders.

Stop Order - is an order to buy above the market or to sell below the market. They are most commonly used as stop-loss orders to limit losses if the market moves contrary to what the trader expected. A stop-loss order will sell the currency if the market falls below the point set by the trader.

One Cancels the Other (OCO) - this order is used when placing a limit order and a stop-loss order at the same time. If either order is executed the other is cancelled, allowing the trader to make a transaction without monitoring the market. If the market falls, the stop-loss order will be executed, but if the market rises to the level of the limit order, the currency will be sold at a profit.

Example OCO Transaction:

Buy: 1 standard lot EUR/USD @ 1.3228 = $132,280
Pip Value: 1 pip = $10
Stop-Loss: 1.3203
Limit: 1.3328

This is an order to buy US dollars at 1.3328 and to sell them if they fall to 1.3203 (resulting in a loss of 25 pips or $250) or to sell them if they rise to 1.3328 (resulting in a profit of 100 pips or $1,000).

Here's another example:

The current bid/ask price for US dollars and Canadian dollars is

USD/CDN 1.2152/57

...meaning you can buy $1 US for 1.2152 CDN or sell 1.2157 CDN for $1 US.

If you think that the US dollar (USD) is undervalued against the Canadian dollar (CDN) you would buy USD (simultaneously selling CDN) and wait for the US dollar to rise.

This is the transaction:
Buy USD: 1 standard lot USD/CDN @ 1.2157 = $121,570 CDN
Pip Value: 1 pip = $10
Stop-Loss: 1.2147
Margin: $1,000 (1%)

You are buying US$100,000 and selling CDN$121,570. Your stop loss order will be executed if the dollar falls below 1.2147, in which case you will lose $100.

However, USD/CDN rises to 1.2192/87. You can now sell $1 US for 1.2192 CDN or sell 1.2187 CDN for $1 US.

Because you entered the transaction by buying US dollars (buying long), you must now sell US dollars and buy back CDN dollars to realize your profit.

You sell US$100,000 at the current USD/CDN rate of 1.2192, and receive 121,920 CDN for which you originally paid CDN$121,570. Your profit is $350 Canadian dollars or US$287.19 (350 divided by the current exchange rate of 1.2187).

forex earnings Week of 2/4/2008 thru 2/8/2008

Monday, February 04, 2008

Economic
7:30am Jan Challenger Job Cuts (last –18.7% y/y)
10:00am Dec Factory Orders (last 1.5%)

Events
11:20am Fed's Kroszner speaks on mortgage regulation in Las Vegas.1:15pm US Treasury's Solomon & Swagel hold briefing on 2009 budgetplan. Credit Suisse Energy Summit, Gartner Business Process ManagementSummit, Annual Meeting of the American Academy of Dermatology. TradesEx-dividend: XLNX $0.12, CTAS $0.46, ZION $0.43, FO, $0.42, HAR $0.013.

Earnings
Before the Open: AHCI, ADM, BEAV, CLX, FCTR, HUM, IR, NTE, NNN, PTIE, PMI, PCH, TPP, WEN. After the Close: ASEI, APC, AUDC, AXS, BMI, EFX, FEIC, HAIN, ILMN, LVS, LNC, MTW, NTCT, NUAN, OPNT, OMI, PKY, PRE, PPS, PWAV, PFG, RMBS, RCII, SVVS, SCUR, SIGI, SGTL, SIRF, SOHU, SPF, SNCR, TNB, TMA, TZIX, VASC, WGL, YUM.

Tuesday, February 05, 2008

Economic
10:00am Jan ISM Business Non Manufacturing (last 54.4)

Events
10:00am Treasury Secretary Paulson testifies to Senate Finance Committee. 12:15pm Fed's Lacker speaks on US economy in West Virginia.10:00am US Treasury's McCormick holds briefing on G-7 talks in Tokyo.12:00pm US Treasury's Steel speaks in Las Vegas on housing, US economy.12:00pm FDA Cellular, Tissue and Gene Therapies Advisory CommitteeMeeting. Redbook Retail Sales (8:55, last 0.4%). ABC ConsumerConfidence (last -27). Gartner Business Intelligence Summit; MerrillLynch Global Pharmaceutical, Biotech & Medical Device Conference;Credit Suisse Financial Services Forum. Trades Ex-split: PSEG 2-1.Trades Ex-dividend: INTC $0.128, TJX $0.09, MWV $0.23, MCHP $0.32, FE$0.55, KBH $0.25.

Earnings
Before the Open: ALEX, ARTG, AVP, BHE, BSX, CE, CNC, GIB, CHD, CME, CPO, COWN, DTPI, DUK, EMR, HNT, HEW, HEP, IEX, NRGY, KSU, KBW, KBALB, LIOX, LPX, MMP, MLM, MYGN, NSTC, NURO, NOOF, NYX, OSIS, PNR, PER, PRGO, SEPR, TE, THOR, TYC, VSH, WHR,WEC, WATG, WWY. During Trading Hours: VFC. After the Close: ACE, ADVS,ABCO, NLY, ATO, RATE, BBBB, BRE, BRS, CALL, CACS, CAKE, CNET, CVLT,XRAY, DBTK, EW, WIRE, EQR, FORM, GHDX, HAR, IIG, INSP, IVAC, IVGN,JDSU, KFRC, LNET, LOOP, MANH, MASI, MPWR, MFLX, NBR, NBIX, NUCO, OCNW,OTTR, PNSN, PEC, PLNR, QSFT, RSYS, RNR, RENT, RSG, RVBD, SGMO, SNCI,SRX, TMRK, THQI, TZOO, TMWD, USNA, VOCS, DIS, XL, ZL.

Wednesday, February 06, 2008

Economic
8:30am Q4 Nonfarm Productivity (last 6.3%), Q4 Unit Labor Costs (last –2.0%)
10:30am Crude Oil/Gasoline/Distillate Inventories 1:00pm US Treasury's 10-year note auction results ($13B)

Events
8:30am Former Fed Chairman Greenspan speaks at the Council on Foreign Relations in Washington, DC. 10:00am Fed's Lacker speaks at Marshall University in West Virginia. 12:30pm Fed's Kroszner speaks on mortgage regulation in Washington, DC. 1:40pm Fed's Plosser speaks on economic outlook in Alabama.MBA Mortgage Applications (7:00, last 7.5%). Same Store Sales after theclose. Ex-split: MCRS 2-1, SDA 3.33-1. Standard & Poor's WorldMoney Show. Trades Ex-dividend: AA $0.17, AEP $0.41, MTG $0.025, ENT$0.75, IBM $0.40, PFE $0.32, BA $0.40, WFC $0.31.

Earnings
Before the Open: ARXT, ASX, LNT, ALVR, AHG, ATMI, BCRX, BIIB, CACH, CCJ, CI, CINF, DWSN, DVN, ENB, FORR, RAIL, HNI, IDEV, IACI, ITT, KIM, LII, LFUS, MAG, MKTX, MMS, MNI, MM, MNC, MGAM, NOV, NSR, NJR, NUS, OSCI, PDX, PXD, RL, RBC, RTIX, SLE, SBGI, SON, TIN, TMO, TWX, TWC, TEL, VYYO, WMG, WXS. During Trading Hours: PARL. After the Close: AEA, AKAM, ACL, ACLI, ANDE, ATML, AVB, CSCO, CREL, EXBD, CPII, CCI, DTLK, DHX, DSCM, EDS, ENH, FISV, FMC, GNK, GRP, GXP, HB, HUBG, INWK, NSIT, ICO, JKHY, KNL, MEAS, MET, MGI, NAPS, NAVR, NVT, EGOV, POL, POWI, PPDI, PRU, RACK, RJET, SCSS, SFLY, SSTI, SNWL, SPTN, SRCL, TLEO, ULTI, UNCA, UFPI, UTI, EICU, WEDC, WSH, WSH, WMS.

Thursday, February 07, 2008

Economic
8:30am Initial Jobless Claims (last 375K), Continuing Claims (last 2.716M)
10:00am Dec Pending Home Sales m/m (last –2.6%)
10:30am Natural Gas Inventories
1:00pm Treasury's 30-year bond auction results ($9B)
3:00pm Dec Consumer Credit (last $15.4B)

Events
8:30am Fed's Lockhart speaks on credit market outlook in Atlanta. 1:00pm Fed's Fisher speaks on economic stability in Mexico City.8:00am FDA Psychopharmacologic Drugs Advisory Committee Meeting.ICSC/UBSW Chain Store Sales (last 0.9%). Same Store Sales before theopen. Trades Ex-dividend: XOM $0.35, GWW $0.35, BUD $0.33, ABK $0.07,COL $0.16, HCBK $0.09.

Earnings
Before the Open: ASF, AES, AET, AG, ATG, ALY, APA, ARJ, STST, ARQL, ASPM, AIZ, ASFI, AN, BDC, BPO, BG, CPHL, FUN, CBB, CNMD, CXW, CUB, DO, DRAD, DHI, ELNK, ELON, EMS, ENER, EXPE, FLIR, IT, GET, ITWO, IAR, IPCC, IP, KVHI, LH, LVLT, MHO, HZO, MDC, MDTH, MRGE, MESA, MGPI, MEND, MEH, MLNM, MKSI, MCO, MPS, NSSC, CHUX, PMTI, PTI, PENN, PEP, PLD, QCCO, RVSN, ROLL, RGC, RAI,SFUN, SBH, SNN, SPC, SPR, SPH, SXCI, TRA, PNX, TOC, TBL, TRMP, VNDA,WW. During Trading Hours: BWA, GCA. After the Close: APKT, ATVI, AEIS,ARE, ALKS, AYE, AMX, ACAP, ASCA, AOC, ATR, ATHN, ATW,BBSI, BNHN, BBND, BLKB, BMC, CELL, CPT, CBL, CTLM, CENT, CF, CHRD,CTSH, CSTR, CVGI, SCOR, DIVX, DRRX, EQ, EOG, EOG, EPIC, ESE, ESRX, FALC, FNET, GDI, GNW,GCOM, SRVY, HMN, ITMN, IWOV, XXIA, KNXA, LDSH, LQDT, LMNX, MFE, MTD,MSTR, NFG, NFS, NMHC, UEPS, NEXT, NINE, NMSS, OMTR, OTEX, PDFS, PBI,PWER, PL, QSII, RAH, RNWK, RMD, RTEC, SIMG, SINA, TWLL, TDG, TTMI,UNTD, UTSI, VMSI, VNUS, VMC, WLT, GB, ZOLT.

Friday, February 08, 2008

Economic
10:00am Dec Wholesale Inventories (last 0.6%)

Events
12:25am Fed's Yellen speaks on economy in Honolulu. 1:00pm Fed's Lockhart speaks on financial markets & the economy in Atlanta. Trades Ex-split: JASO 3-1. Trades Ex-dividend: CFC $0.15, BTU $0.06.

Earnings
Before the Open: AIXD, ALU, AIV, BECN, BEC, BW, CLWR, COT, CVH, DHT, DRS, FNM, LPNT, LZ, NNI, PBH, RTK, SKYW, SYNT, VTNC, WY, WIN. After the Close: None seen.

Microsoft + Yahoo = Microsoft - $44.6 billion

NEW YORK (Reuters) - Microsoft Corp (MSFT.O: Quote) has made an unsolicited offer to buy Yahoo Inc (YHOO.O: Quote) for $44.6 billion in cash and stock, seeking to join forces against Google Inc (GOOG.O: Quote) in what would be the biggest Internet deal since the Time Warner-AOL merger.

In its boldest-ever acquisition move, Microsoft said on Friday it offered $31 per share for Yahoo, or a 62 percent premium over the Internet media company's closing stock price on Nasdaq Thursday.

Yahoo, whose shares jumped to $30.75 in premarket trading, said it would evaluate the bid.

Microsoft shares, which have a market capitalization of about $300 billion, fell 6 percent to $30.78.

World Economic Update

The International Monetary Fund (IMF) has again cut its forecast for world economic growth and is bracing for more bad news in rich and poor countries, even as it stopped short of using the word "recession" on Tuesday (WASHINGTON).

This year, the global economy will post its weakest performance in five years, the global economic watchdog said in an update to its semi-annual World Economic Outlook report.

The warning comes days after IMF managing director Dominique Strauss-Kahn broke with tradition and asked governments to spend more - even at the cost of increasing budget deficits, which the agency normally considers a cardinal sin - to stimulate their economies. Strauss-Kahn cited the severity of the unfolding downturn.

Growth in 2008 likely will slow to 4.1%, from 4.9% in 2007. Last October, it predicted 4.4% growth for 2008. This would be the worst performance since 2003, when the world economy grew by 3.6%, according to the IMF.

"The overall balance of risks to the global growth outlook is still tilted to the downside," the fund said.
"Growth in emerging market countries that are heavily dependent on capital inflows could be particularly affected, while the strong momentum of domestic demand in some emerging market countries provides upside potential" according to the World Economic Outlook Update.

The report also points to other risks: "monetary policy faces the difficult challenge of balancing the risks of higher inflation and slower economic activity although a possible softening of oil prices could moderate inflation pressures".

U.S. growth is projected by the IMF to slow to 1.5% this year, down from 2.2% in 2007 but the update points out that the 2008 number reflects the carryover from 2007. Projections on a quarterly basis (Q4-Q4) give a better sense of the slowing growth momentum. On this basis, growth is projected at 0.8% in the fourth quarter of 2008, compared with 2.6% during the same period of 2007. IMF also describes the recent move by the U.S. Federal Reserve to cut rates by 75 basis points as “appropriate and helpful”.

For the Euro area growth on an annual basis is projected at 1.6% in 2008, down from 2.6% last year. On a Q4-Q4 basis, growth is projected at 1.3%, compared with 2.3% in 2007. IMF economist Simon Johnson said inflation remained a serious concern in Europe and the European Central Bank had done a good job of managing liquidity.

The world’s second largest economy Japan has been dampened by a tightening in building standards, while consumer and business sentiment have weakened. Japan's growth is forecast on an annual basis at 1.5% in 2008, down from 1.9% last year.

Regarding emerging markets and developing countries, led by China and India they have continued to expand strongly. These countries have benefited from the strong momentum of domestic demand, more disciplined macroeconomic policy frameworks, and in the case of commodity exporters, from high food and energy prices. But growth is also expected to ease moderating from 7.8% in 2007 to 6.9% in 2008. In China, growth is projected to decelerate from 11.4% to 10%.

Headline inflation has increased since mid-2007 in both advanced and emerging economies and has become a major challenge. Core inflation has also drifted upward. In the United States, the Federal Reserve has been cutting interest rates in response to increasing downside risks to activity, while policy has been on hold in the Euro area and Japan. Meanwhile, central banks have continued to tighten monetary policy in many emerging market economies, where food and energy represent a higher share of consumption baskets and overheating is more of a concern.

In a separate Global Financial Stability Report Markets Update IMF said that deteriorating economic conditions could exacerbate pressures on major financial institutions that have already suffered big losses from the subprime crisis.

A possibly deeper economic downturn in the United States or elsewhere could also serve to widen the crisis beyond the subprime sector, as credit deteriorates more broadly, it stated. Already delinquency rates in 2007 vintages of U.S. prime mortgages (those to the most credit worthy borrowers) are rising faster than in previous years, albeit from low levels, and other forms of consumer credit show signs of deterioration.

IMF warns that in Western Europe signs of a future slowdown in credit growth are just now emerging and there is some potential for worsening credit quality as lending has been very robust in some countries and several countries face housing markets considered overvalued.

Lending in some segments of the corporate sector also expanded rapidly in the first half of 2007 with the rise in leverage buyouts. Weaker quality corporates have already seen a substantial rise in the cost of credit although yields investment grade debt has remained relatively stable. Additionally, a slowing economy will likely exacerbate the tighter credit environment further as unemployment picks up and job growth slows.

Emerging markets have been resilient so far, but face challenges ahead. Emerging market equities have outperformed mature equity markets, but prices in some markets have declined steeply since the start of the year on expectations that the U.S. economy may slow more rapidly.

UPDATE: Colombia Nov Trade Surplus $190M Vs Nov 2006 Deficit

Colombia posted a trade surplus of $190 million in November compared to a $239 million deficit in the same month in 2006, the national statistics department, known as DANE, said Friday.

DANE said exports in November advanced 47% to $2.59 billion.

In the first 11 months of the year, the country posted a trade deficit of $1.33 billion compared to a deficit of $52 million in the same period in 2006.

Exports of oil, coal, coffee and nickel rose 53% in November from the same month in 2006 to $1.43 billion, while other exports saw a 42% rise to $1.69 billion.

Exports of oil products in November rose 111% to $853 million, boosted by higher prices, as the country's oil companies shipped 25% more tons of oil and processed products out of the country. Coal exports rose 9.5% to $304 million in value, and were up 2.1% to 5.74 million metric tons in volume.

In November, the worth of nickel exports fell 6.1% to $118 million, while coffee exports rose 20% to $152 million.

The largest trade deficit registered by Colombia in the first 11 months of the year was with Mexico at $2.25 billion, followed by China at $2.02 billion and Brazil $1.67 billion.

The trade gap with those countries was partly offset by surpluses of $3.34 billion with Venezuela and $2.05 billion with the U.S.

Analysts partly attribute the wider deficit in the 11-month period to the appreciation of the Colombian peso, which gained 11% last year, made exports less competitive, while encouraging Colombians to buy more imported goods and services.

New Services from FOREX.com

More trading opportunities.
You can now trade four new currency pairs at FOREX.com - AUD/NZD, AUD/CAD,
GBP/AUD, GBP/CAD. These new cross currency pairs allow traders to directly target trading opportunities in the so-called “commodity” currencies.

Even more research.
Now you can access more research from within the platform; session recaps and pivot points are available from within our FOREXTrader platforms.

Published three times daily at the close of each major market session, the session recaps provide actionable insight on the market. Pivot point calculations can help you determine significant support and resistance levels to anticipate trend shifts, especially when used in conjunction with other technical indicators.

More trader education.
Sharpen your trading skills with enhanced Learn To Trade Forex training program. The new course features updated information and additional lessons. Also, as part of the program you now have unlimited access to an experienced FX instructor.

Also added half-day intensive training sessions with FOREX.com’s team of seasoned FX instructors in cities worldwide.

Even more convenient funding options.
Deposits in five currencies - USD, EUR, AUD, CAD, CHF and GBF. You can now withdraw funds online from MyAccount.

Your satisfaction matters.
Feed Back:

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Forex Benefits

The benefits of trading Forex (FX) online include but are not limited to the following:

• Real time live price quotes and execution
• Lower transaction costs
• Real time account position analysis as it relates to Profits & Losses
• Free full access to real time market news, data and analysis - including real-time price quotes, international news, government-issued economic indicators and reports, as well as subjective information such as expert commentary and analysis, trader chat forums etc.

The benefits of trading Forex (FX) vs. Equities & Futures Contracts are:

• Around the clock trading capability - 24 Hour a day trading (Weekdays)
• High level of liquidity, especially in the major currencies as the market exceeds US $1.8 Trillion daily.
• Highly leveraged with utilization of margins which allows for profit maximization and minimal up-front deposits. Please beware that this also indicates that the potential for losses is great as well if a prudent strategy is not adhered to.
• Lower transaction costs as most brokers do not charge commissions / fees as they operate from the width of the spreads in currency pairs.
• Real Time level information field between market participants
• Profit potential without restrictions in both a Long and a Short market (No up tick rule as in a Stock Short transaction).
• Uses easily understood terminology

Margins & Rollovers

Margins in the Forex (FX) market, unlike their counterparties in the purchase of equity (Down payment), provide for a performance bond against trading losses. The utilization of margins allows traders to hold a position much larger than their account value (Leverage). This allows for increased profit capabilities & positions while maintaining a constant counterbalance against trading losses even in a highly volatile market.

A Rollover is used for open daily positions; a trader will either pay or earn interest on their positions depending on the established margin and market position. Rollover positions are an inherent part of the Forex (FX) trading so it is imperative to keep track of the costs associated. Interest is paid on the currency that is borrowed, and earned on the one that is purchased. If a trader is buying a currency with a higher interest rate than the one he/she is borrowing, the net differential will be positive – and the client will earn funds as a result. Otherwise, the trader will have to incur a negative rollover and pay as long as the position remains open. (In other words, if you are long (bought) a particular currency and that currency has higher overnight interest rate you will gain and if you are short (sold) the currency with a higher overnight interest rate than you will lose the difference.)

Trading Hours

The trading is open 24 hours a day (Weekdays) - trading begins each day in Sydney, and moves around the globe as the business day begins in each financial center, first to Tokyo, London, and New York. Traders have the ability to transact virtually every hour of the day across the globe allowing for tremendous trading flexibility: A true 24-hour market, the online Forex trading market is unlike any other financial market as investors can immediately respond to currency fluctuations caused by economic, social and political events at the time they occur - day or night.

Time Zone		Local Time		GMT		E.S.T (US)
Sydney Open		8:00 AM		9:00 PM *		4:00 PM *
Sydney Close		5:00 PM		6:00 AM		1:00 AM
Tokyo Open		8:00 AM		11:00 PM		6:00 PM *
Tokyo Close		5:00 PM		8:00 AM		3:00 AM
London Open		8:00 AM		8:00 AM		3:00 AM
London Close		5:00 PM		5:00 PM		12:00 PM
New York Open		8:00 AM		1:00 PM		8:00 AM
New York Close		5:00 PM		10:00 PM		5:00 PM
* Previous Night

Traders may either buy (Long) or sell (Short) a currency pairing based on their position and analysis; this provides for the ability to profit in either an up or down market. If a trader believes that a currency will appreciate in value they will buy that currency and if they believe that the currency will depreciate in value, they will sell that currency (Not unlike a short position in the stock market)

Market Overview

The Foreign Exchange or Forex (FX) market allows individuals and/or firms to speculate on the exchange rate between two currencies. It may also be utilized for hedging and protection purposes by individuals and/or firms that transact business globally.

The FX market is considered an Over The Counter (OTC) or 'Interbank' market, due to the fact that transactions are conducted between two counterparts over the telephone or via an electronic network. Trading is not centralized on an exchange as with the stock and futures markets.

The major players in the market up until now have been only professional traders from major international commercial and investment banks. Today, the market is being utilized by other market participants that range from large multinational corporations, global money managers, registered dealers, international money brokers, futures and options traders, to private speculators.

The three main reasons for the market are – conversion of foreign profits into domestic currency, hedging against unwanted exposure to future price movements in the currency market and the most popular reason is for speculative profits which accounts for 95% of today’s daily FOREX (FX) volume.

By speculating in the Forex (FX) market, traders buy & sell currencies with the hope of making a profit when the value of the currencies changes in their favor.

Traders utilize both Fundamental (Global News, Economic Data) & Technical (Real Time and Historical Rate Data) analysis in order to assess their bias / position.

Technical traders use charts, trend lines, support and resistance levels, and numerous patterns and mathematical analyses to identify trading opportunities, whereas fundamentalists predict price movements by interpreting a wide variety of economic indicators including news, government-issued indicators and reports, and even rumor.

The major factors affecting the Forex (FX) market are economic, social and political events that relate to monetary and fiscal policies around the globe (Interest rates, Inflation, Trade Surplus / Deficit, etc.) In addition, traders also assess Central Banks across the globe with regards to intervention policies where governments sometimes participate in the Forex (FX) market to influence the value of their currencies, either by flooding the market with their domestic currency in an attempt to lower the price, or conversely buying in order to raise the price. Any of the aforementioned factors or large market orders might cause volatility.

The most dramatic price movements however, occur when unexpected events happen. The event can range from a Central Bank raising domestic interest rates to the outcome of a political election or even an act of war. Nonetheless, more often it is the expectations surrounding an event that drives the market rather than the event itself.

The Forex (FX) market's volume is estimated at over US $1.8 Trillion daily which makes it the largest and one of the most exhilarating trading markets in the world today – 30 times larger than the volume of US Equities markets.

As in any investment, it is prudent to assess the online forex trading brokers prior to opening an account. Below you will find the regulating bodies that oversee the industry:

		US Commodity Futures Trading Commission (CFTC)
		US National Futures Association (NFA)
		US National Association of Securities Dealers (NASD)
		UK Financial Services Authority (FSA)
		Finanstilsynet (FSA Denmark)
		Swiss Federal Department of Finance (FDF)
		Association Romande des intermediares financiers (ARIF)
		Hong Kong Securities and Futures Commission (SFC)
		Australian Securities & Investments Commission (ASIC)

Currency Description

The world's currencies are on a floating exchange rate and are always traded and quoted in pairs. The most often traded currencies are those of countries with relatively stable governments, respected central banks, and low inflation. The major currencies in today’s market are - US Dollar, Japanese Yen, Euro, British Pound, Swiss Franc, Canadian Dollar and Australian Dollar.

The first listed currency is known as the base currency (With a value of 1), while the second is called the counter or quote currency; If a trader buys a EUR/USD position for example, he/she has bought the base currency, EURO and simultaneously sold USD, believing that the base currency in this case, EURO, will increase in value. (If a currency quote goes higher, that increases the value of the base currency. A lower quote means the base currency is weakening).

Currency pairs that do not involve the U.S. dollar are called cross currencies, but they are valued the same. Currency pairs are quoted either Direct (GBPUSD, EURUSD, AUDUSD, NZDUSD), Inverse (USDJPY, USDCHF, USDCAD, USDZAR) or Cross (EURGBP, EURJPY, EURCHF, GBPCHF, GBPJPY, CHFJPY) rate terms.

A forex quote will include a “Bid / Ask” spread; the 'bid' is the price at which you can sell the base currency (At the same time buying the counter currency). The 'ask' is the price at which you can buy the base currency (At the same time selling the counter currency).

The calculation of the value of a single PIP (The movement unit of a currency pair), a trader will utilize the following methods:

• For a Direct Quote, the PIP Value = Lot Size X Tick Size, where Tick size is the smallest possible change in price.
• For an Inverse Quoted currency pair, the PIP Value = (Lot Size X Tick Size) / Current Quote
• For Cross Quotes, the PIP Value = (Lot Size X Tick Size X Base Quote) / Current Quote where the Base Quote is the current Base Pair quote.

Exchange rate quotes are given as five digit numerals. For example, USDJPY = 108.25 signifies that US$1 equates to 108.25 Yen, and EURUSD = 1.2525 signifies that 1 EURO equates to US$1.2525.

For a quote expressed as AAABBB = C, 1 Unit of AAA = C Units of BBB.

Symbol		Currency Pair		Nickname
EURUSD		Euro / US Dollar		"Euro"
EURGBP		Euro / British Pound		"Euro Sterling"
EURJPY		Euro / Japanese Yen		"Euro Yen"
EURCHF		Euro / Swiss Franc		"Euro Swiss"
USDJPY		US Dollar / Japanese Yen		"Dollar Yen"
USDCHF		US Dollar / Swiss Franc		"Dollar Swiss" or "Swissy"
USDCAD		US Dollar / Canadian Dollar		"Dollar Canada"
USDZAR		US Dollar / South African Rand		"Dollar Zar"
GBPUSD		British Pound / US Dollar		"Cable"
GBPCHF		British Pound / Swiss Franc		"Sterling Swiss"
GBPJPY		British Pound / Japanese Yen		"Sterling Yen"
AUDUSD		Australian Dollar / US Dollar		"Aussie Dollar"
CHFJPY		Swiss Franc / Japanese Yen		"Swiss Yen"
NZDUSD		New Zealand Dollar / US Dollar		"New Zealand Dollar" or "Kiwi"