Two Stories Grab Market Attention
November 22, 2010
European currencies rose after Ireland’s government agreed to an EU aid package that will be used to fortify the country’s beleaguered banks. The dollar dropped 0.4% against the euro, 0.3% against the Swiss franc, and 0.2% against the yen. Irish bond yields have fallen over ten basis points on the news.
S&P reduced the outlook to negative from stable on New Zealand’s AA+ foreign currency debt rating, citing an upwardly trending current account deficit expected in coming years and the weaker quality of New Zealand’s banking sector. The kiwi fell 0.4% against the dollar and 1.1% against the Australian dollar in response.
The dollar has eased 0.5% against the Canadian dollar but is unchanged against the yen and yuan.
Ten-year sovereign bond yields rose six basis points in Japan, fell three basis points in Britain, and are unchanged in Germany.
Stocks rose 2.1% in Pakistan, 1.9% in India, 1.0% in Thailand, 0.9% in New Zealand, 0.8% in Taiwan, 0.9% in Japan, 0.4% in Indonesia, and 0.3% in Australia. Equities slipped 0.4% in Hong Kong and by 0.2% in Singapore, China and Malaysia . In Europe, share prices are 0.5%, 0.4% and 0.3% in Germany, Britain and France on relief over the Irish bailout, details of which remain largely unknown.
Oil and gold prices advanced by 0.9% and 0.4% on this holiday-shortened week.
Swiss on-year money growth slowed in October to 6.1% from 6.7% in the case of M3, 8.4% from 9.3% for M2 and 9.1% from 10.0% for M1.
Hong Kong consumer price inflation remained steady in October at a 12-month pace of 2.6%, although the core index accelerated to 2.3% from 2.2% in September.
Malaysian GDP growth slowed to 5.3% on year in 3Q from 8.9% in 2Q.
Japanese supermarket sales, which have been posting on-year declines since December 2008, fell 0.3% in the year to October, same as the on-year drop in September.
Icelandic wages recorded a 6.0% on-year advance for the fourth straight month in October. The inflation-adjusted rise was 2.6%.
The Conference Board measure of France’s index of leading economic indicators rose 0.8% in September, while the coincident index went up 0.2%.
Danish consumer confidence improved to a reading of 3.6 in November from 0.6 in October.
There are no meaningful U.S. or Canadian data releases scheduled today. Eurostat will be releasing a preliminary estimate of Euroland consumer confidence, and a rate announcement is expected from the Bank of Israel. Today is the 47th anniversary of John Kennedy’s assassination. Japanese markets will be closed tomorrow for Labor Thanksgiving Day.
Copyright Larry Greenberg 2010. All rights reserved. No secondary distribution without express permission.
Tags: Irish bailout, New Zealand rating
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