Key News
• European government bonds were higher, supported by a weak business confidence survey in Germany and fresh jitters over the credit markets. The Ifo research institute said its business climate index for Germany in September fell to 104.2 from 105.8 in Aug, below analysts' forecasts for 105.0. (Thompson)
• Britain's deposit protection scheme currently holds funds of just £4.4m, it emerged yesterday as banks warned that consumers face sharp price rises to pay for the Chancellor's plans to offer a £100,000 guarantee. (The Independent)
• UK business investment in the second quarter was revised down to show only a 0.4 pct quarterly growth rate, from 0.8 pct in the preliminary estimate, official figures showed. (Thompson)
• Key Reports Due (WSJ):
7:45a.m. ICSC Chain Store Sales Index For Sep 22. Previous: -1.1%.
8:55a.m. Redbook Retail Sales Index For Sep 22. Previous: +0.8%.
10:00a.m. August Existing Home Sales. Expected: -4.4%. Previous: -0.2%.
10:00a.m. Sep Conference Board Consumer Confidence. Expected: 104.5. Previous: 105.0.
10:00a.m. Sep Richmond Fed Manufacturing Index. Previous: 7.
5:00p.m. ABC/Wash Post Consumer Conf. Previous: -15.
Quotable
I'm astounded by people who want to 'know' the universe when it's hard enough to find your way around Chinatown.
Woody Allen
FX Trading – Carry-over?
Business confidence slips in Germany. The pound pounded on ongoing credit market concerns. The yen the strongest of the pack yesterday and today… Is that scenario, the outside chance scenario, suggesting global growth is in a bit of trouble, bringing risk back onto the table? The carry trade currencies are turning over this morning. Is it a rest before another run, or something more?
Could there be a better time for Mr. Market to trap the many mega US dollar bears?
[90-min charts below]
And of course, the powerful two-day trend in lower crude is intact this morning (that was a joke; but seriously, when oil breaks, it really breaks, and doesn’t give short players much chance to enter):
And once again…the crude connection between oil (black), the dollar (blue), and euro (red)…
Jack Crooks
Black Swan Capital
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