Mon Nov 16, 7:05 am ET
LONDON (AFP) – The dollar fell on Monday as China accused the United States of increasing protectionism and following unexpectedly strong Japanese economic growth figures, pushing gold prices to a record high point.
US President Barack Obama is in China for a three-day mission aimed at convincing Beijing that Washington is its partner, not its rival.
As the dollar dropped against the euro and yen, gold struck an all-time peak of 1,133.20 dollars an ounce.
In late morning trading here, the euro climbed to 1.4969 dollars from 1.4918 dollars late in New York on Friday.
Against the Japanese currency, the dollar fell to 89.42 yen from 89.66 yen late on Friday.
"Far better than expected Japanese third-quarter GDP data...spurred risk appetite," said Jane Foley, an analyst for online trading firm Forex.com.
"This pushed the euro close to 1.50 dollars in early European hours."
Japan's gross domestic product (GDP) grew 1.2 percent in the third quarter of 2009 from the previous quarter -- the fastest pace in two-and-a-half years and much better than expected, the government reported.
The euro also gained as higher commodity prices, driven by hopes of a global economic recovery, spurred investor risk appetite, market watchers said.
"Gains in gold prices lifted demand for currencies of commodities-exporting nations like the Aussie against the US dollar," Osao Iizuka, chief foreign exchange trader at the Sumitomo Trust and Banking Co, told Dow Jones Newswires.
"Then the selling of the US dollar spread across other currencies, causing the euro to gain ground," he said.
Comments from a Chinese commerce ministry spokesman accusing the US of protectionism earned a quick rebuttal from senior US officials speaking in Beijing, who said a trade war was in neither country's best interests.
"We used to see that the United States was an innovation-driven US. But what we are seeing now is an increasingly protective US," commerce ministry spokesman Yao Jian told reporters at a regular monthly briefing.
"It is necessary to create for enterprises a stable and predictable environment, including (stable) economic and foreign exchange policies, to help the global economy grow steadily and China's exports recover," he said.
Yao added that the United States had "continued" to let the dollar drop "to improve its competitiveness" while pressing for the yuan's appreciation.
"It is detrimental to the global recovery and is unfair for (the US) to require other (currencies) to rise while allowing the dollar to keep slumping," Yao told reporters.
But US Commerce Secretary Gary Locke said Washington was not at fault.
"The United States is not engaged in increased protectionism," Locke told a luncheon in Beijing.
Obama is expected to raise trade tensions with his counterpart Hu Jintao and also urge China to reconsider the value of the yuan, which has been effectively pegged to the dollar since July 2008 and is deemed by Washington as being kept artificially low to boost Chinese exports.
In London on Monday, the euro was changing hands at 1.4969 dollars against 1.4918 dollars late on Friday, at 133.85 yen (133.57), 0.8966 pounds (0.8937) and 1.5096 Swiss francs (1.5093).
The dollar stood at 89.42 yen (89.66) and 1.0085 Swiss francs (1.0117).
The pound was at 1.6695 dollars (1.6693).
On the London Bullion Market, the price of gold jumped to 1,131.70 dollars an ounce from 1,104 dollars an ounce late on Friday.
Showing posts with label US Stocks. Show all posts
Showing posts with label US Stocks. Show all posts
Monday, November 16, 2009
Thursday, October 1, 2009
Stocks Take a Beating
NEW YORK (TheStreet) -- Stocks sold off at the start of the new quarter as disappointing jobless claims data left Wall Street bracing for Friday's unemployment report. After locking in 15% gains for the third quarter, the Dow Jones Industrial Average started off the new three-month period by taking a 204.89-point plunge, dropping 2.1%, to 9507.39, while the S&P 500 slid 27.4 points, or 2.6%, to 1029.68. The Nasdaq Composite edged down 64.94 points, or 3.1%, to 2057.48.
Losses were broadbased with financials, commodities, technology and home stocks hard hit. The Philadelphia Stock Exchange Gold and Silver Index, the Philadelphia Semiconductor Index, and the KBW Bank Index all sank more than 4%.
Stocks fell early after the Department of Labor said there were 551,000 new jobless claims last week, up from an upwardly revised 534,000 the week prior and topping expectations for 535,000.
Those data, paired with a worse than expected report on private sector job losses earlier in the week, have traders cautious ahead of the most-anticipated data of the week, Friday's unemployment report, says Doug Roberts, chief investment strategist at ChannelCapitalResearch.com.
"You've seen chinks in the armor, so people are hesitant -- especially with it coming on a Friday," says Roberts. "There's uncertainty, and until there's some sort of resolution, people are going to be nervous."
Adding pressure to the market, Goldman Sachs changed its forecast for September nonfarm payrolls from a loss of 200,000 to a loss of 250,000, wrote James DePorre, founder and CEO of Shark Asset Management, on RealMoney.com.
In other data Thursday, Institute for Supply Management's manufacturing index edged down 0.3 points to 53.6, vs. expectations for a rise to 54. The Chicago PMI spurred selling earlier in the week, when it indicated a contraction in manufacturing.
"Tentative signs in housing, automobile, Chicago PMI and several other economic indicators continue to remind us that the month of September was weaker than generally expected," writes Seabreeze Partners' Doug Kass. He later adds that, "at the risk of being the boy who cried wolf, I believe that market participants have a false sense of security in rising equity share prices."
"Plenty of stocks were pumped up by mark-up buying. The pump-up and subsequent support underneath is now gone," writes Jim Cramer on RealMoney.com."We know that jobless claims aren't improving. That's a real negative, especially for retail and banks. But, and this is a big but, we are not seeing the right stocks go up if we are signaling another dip down."
Not all of the recent data have been negative. Among the day's surprises, construction spending unexpectedly increased by 0.8% in August, and pending home sales rose by 6.4% vs. expectations for a much smaller, 1% gain.
At the same time, the Department of Commerce said personal income increased 0.2% in August, in line with the prior month's increase, and spending ticked up 1.3%, respectively, vs. 0.3% in July. Both readings were slightly better than expected.
In other news Thursday, Federal Reserve Chairman Ben Bernanke testified before the House Financial Services Committee on regulatory reform. Bernanke told members of Congress that a council of regulators should monitor systemic risk, while all systemically important financial firms should be subject to a consolidated regulator.
Losses were broadbased with financials, commodities, technology and home stocks hard hit. The Philadelphia Stock Exchange Gold and Silver Index, the Philadelphia Semiconductor Index, and the KBW Bank Index all sank more than 4%.
Stocks fell early after the Department of Labor said there were 551,000 new jobless claims last week, up from an upwardly revised 534,000 the week prior and topping expectations for 535,000.
Those data, paired with a worse than expected report on private sector job losses earlier in the week, have traders cautious ahead of the most-anticipated data of the week, Friday's unemployment report, says Doug Roberts, chief investment strategist at ChannelCapitalResearch.com.
"You've seen chinks in the armor, so people are hesitant -- especially with it coming on a Friday," says Roberts. "There's uncertainty, and until there's some sort of resolution, people are going to be nervous."
Adding pressure to the market, Goldman Sachs changed its forecast for September nonfarm payrolls from a loss of 200,000 to a loss of 250,000, wrote James DePorre, founder and CEO of Shark Asset Management, on RealMoney.com.
In other data Thursday, Institute for Supply Management's manufacturing index edged down 0.3 points to 53.6, vs. expectations for a rise to 54. The Chicago PMI spurred selling earlier in the week, when it indicated a contraction in manufacturing.
"Tentative signs in housing, automobile, Chicago PMI and several other economic indicators continue to remind us that the month of September was weaker than generally expected," writes Seabreeze Partners' Doug Kass. He later adds that, "at the risk of being the boy who cried wolf, I believe that market participants have a false sense of security in rising equity share prices."
"Plenty of stocks were pumped up by mark-up buying. The pump-up and subsequent support underneath is now gone," writes Jim Cramer on RealMoney.com."We know that jobless claims aren't improving. That's a real negative, especially for retail and banks. But, and this is a big but, we are not seeing the right stocks go up if we are signaling another dip down."
Not all of the recent data have been negative. Among the day's surprises, construction spending unexpectedly increased by 0.8% in August, and pending home sales rose by 6.4% vs. expectations for a much smaller, 1% gain.
At the same time, the Department of Commerce said personal income increased 0.2% in August, in line with the prior month's increase, and spending ticked up 1.3%, respectively, vs. 0.3% in July. Both readings were slightly better than expected.
In other news Thursday, Federal Reserve Chairman Ben Bernanke testified before the House Financial Services Committee on regulatory reform. Bernanke told members of Congress that a council of regulators should monitor systemic risk, while all systemically important financial firms should be subject to a consolidated regulator.
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