Financial Markets…U.S. Treasuries extended losses on Wednesday, pushing 30-year yields to nearly a two-year high, after reports showed the U.S. economy grew stronger-than-expected in the second quarter and private sector added jobs more-than-expected in July. Robust U.S. economic data fueled speculation the Federal Reserve may start to scale back its stimulus program sooner than expected. The benchmark 10-year yield widened 6 basis points to 2.67%, while 30-year bond yields touched 3.74%, the highest level since August 2011.
Financial Markets…Global equities moved higher on Tuesday amid promising earnings reports from Asian, European, and U.S. companies and a rise in Euro-zone consumer and business confidence in July. Investors are currently turning their focus to this week’s three central bank meetings (the U.S. Federal Reserve, European Central Bank, and Bank of England). The MSCI Asia Pacific Index gained 0.5% with the index gearing for a monthly gain of 2.5%, while the Stoxx Europe 600 Index added 0.2%, extending its July gain to 5.1%. U.S.
Financial Markets… The yen rose for a third day against the dollar on Monday, helped by solid Japanese retail sales and growing speculation of steady monetary stimulus by the Federal Reserve. Japan’s currency strengthened 0.3% versus the dollar to 97.93 after reaching a one-month high of 97.64 earlier, while it advanced 0.4% against the euro to 129.85 after touching 128.77, the strongest level since July 15.
Financial Markets…U.S. Treasuries and German bunds fell as positive news on U.S. durable goods orders in June and German business confidence dampened demand for the safe-haven government debt. Treasury 10-year yields rose for a third day to 2.603%, while comparable German bund yields climbed 4 basis points to 1.68%, after touching nearly 3-week highs of 1.69% earlier. Meanwhile, the U.S. Treasury will auction $29 billion of 7-year notes today after selling of 2-and 5-year securities this week.
Financial Markets…Global stock markets edged higher on Wednesday as gains in European and U.S. equities offset a retreat in Asia shares. Europe’s benchmark stock index rose to the highest level since May 31 amid sign of growth in the region’s manufacturing, while U.S. stocks opened higher this morning on strong earnings results from technology giant Apple and positive Euro-area economic data. In contrast, most Asian shares retreated amid renewed concerns over Chinas’ economic outlook in the wake faster-than-expected slowdown in the country’s manufacturing activity.
Financial and Commodity Markets…Global equities advanced on Tuesday, with the benchmark index gearing for a five-year high, as investors speculated that Chinese government will increase spending in an effort to maintain annual economic growth of at least 7%. Robust earnings reports from major U.S. companies also propelled the S&P 500 index to a fresh record high in morning trade. The MSCI world stock index is up 0.3%, within reaching distance of five-year high reached in May.
Financial and Commodity Markets…US oil prices have reached parity with the global crude benchmark Brent for the first time in almost three years. WTI, the US benchmark, whose September contract reached the same level as September Brent, was last at parity with the North Sea contract in October 2010. WTI has traded at a discount to Brent over the past few years as a surge in US oil production – due to the shale boom – led to a glut at Cushing, Oklahoma, the delivery point for the US benchmark.
The World Bank just published the July edition of the commodity markets outlook. The report notes that most commodity prices continue to remain weak. However, there is a resurgence of short term risks to the upside in energy markets, as geopolitical tensions in the Middle East resurface, as well as renewed weather-related concerns in the grain markets. In contrast, there has been a sharp decline in prices of precious metals in the last one month.
Financial Markets…Global equities are heaving for their best week in 8 months after Federal Reserve Chairman Ben Bernanke reassured that the U.S. central bank will maintain the current stimulus program for some time. The benchmark MSCI world stock index is gearing for the biggest weekly gain since November with European and Asian shares extending their gains on Friday. The S&P and the Dow Jones Average closed at new record highs yesterday in the wake of Bernanke’s comment after the market’s close on Wednesday.
Financial Markets…Italian and Spanish government bonds fell on Thursday, with the benchmark 10-year yields climbing 7 basis points to 4.52% and 8 bps to 4.89% respectively, amid speculation that both countries are likely to struggle to find eager investors for their new debt auctions this year as the economic outlook for the nations deteriorates. The rate on similar-maturity Portuguese bonds also increased 12 bps to 6.89%.
Financial Markets…Italy’s sovereign credit rating was cut to ‘BBB’ from ‘BBB+’ by Standard and Poor’s due to a weakening of the country’s economic prospects and financial system. S&P also said in a statement the outlook on the rating, two levels above junk status, remains negative. Italy’s benchmark 10-year yield rose 5 basis points to 4.45%, the most since July 3.
Financial Markets… Greek government bonds advanced for a third day on Tuesday after the European Union agreed to release additional aid to the country yesterday—€2.5 billion this month and €500 million in October if the government delivers on economic reforms and budget cuts. The Greek 10-year bond yield fell 14 basis points to 10.79%, extending its three-day declines to 90 bps.
Financial Markets…Japan unloaded record amounts of U.S. Treasuries in May amid the steepest monthly loss for the securities in more than three years. Japanese investors reduced a net 3 trillion yen ($30 billion) of their holdings of U.S. government bonds in a fifth consecutive monthly of overall sales that were the biggest on record. Meanwhile, the country’s investors were also net sellers of foreign debt at a record volume of 2.96 trillion yen, pushing year-to-date total to 10.6 trillion yen.
Indices of Nominal US$ Prices, Percent Changes (April 2013 to March 2012).
Financial Markets…Japanese stocks advanced for a fourth day on Tuesday as the country’s exporters gained on a weaker yen. Positive U.S. manufacturing and construction data also boosted overall investor sentiment. The benchmark Nikkei 225 index gained 1.8% to close above 14,000 levels for the first time in five weeks, while the broader Topix index climbed 1.8% to extend its four-day gains to 9.6%.