Market Summary, Commentary for April 11 2011 ;
Market Commentary
Spotlight of the Week
EURUSD: The European Central Bank raised its benchmark interest rates by 0.25% to 1.25% last Thursday. This was the first increase in interest rates by the ECB since 2008. ECB President Jean-Claude Trichet commented that the rate increase was intended to help maintain price stability in the face of rising inflation concerns Although President Trichet added that markets should not expect a quick series of further rate hikes, economists still expects borrowing rate to be increased in July and October if inflationary pressure escalates further. Rate hike expectation will probably keep euro strong against U.S. dollar.
Market Summary
* Precious Metals: Gold prices climbed to a new record high last week, above $1470 an ounce. This is gold’s biggest weekly gain in four months. Inflationary fears and a weaker dollar increased gold’s appeal as a currency alternative and hedge against inflation. Based on data from the CFTC, hedge-fund managers and other large speculators increased their net-long position in New York gold futures in the week ended April 5. Net-long positions rose by 11,585 contracts, or 6%, from a week earlier.
* Crude Oil: U.S. crude oil futures rallied, climbing by more than 4% to the highest level in 30 months. This is the third consecutive week that crude oil prices have gained. While unrest in the Middle East simmered, a decline in the dollar spurred a broad rally in commodities. Money managers raised their netlong crude oil futures and options positions in the week through April 5 by 13,231 to 305,297. The EIA reported that U.S. crude inventories rose by 1.95 million barrels to 357.66 million barrels in the week to 1 April.
* Currencies: Euro strengthened against U.S. dollar as European Central Bank raised its benchmark interest rates by 0.25% to 1.25%. This was the first increase in interest rates by the ECB since 2008. Euro rose despite Billionaire investor George Soros said the European Central Bank’s decision to raise its benchmark lending rate was inappropriate because several euro member countries are suffering from too much debt. Japanese Yen weakened against the U.S. dollar due to concerted effort from global central banks to keep Yen weak, in an effort to help Japan recover from the devastating earthquake.
* Indices: S&P 500 fell this week as crude oil’s rally to a 30-month high spurred concern that the global economy will slow. Oil advanced as NATO escalated its air campaign over Libya and on concern unrest may spread to other energyexporting countries in the Middle East. MSCI Singapore Index gained 2.15% for the week ending April 8, 2011. Seven stocks rose for each that fell in MSCI Singapore index of 32 companies. Financial sector is the best performing sector while Telecommunication sector is the worst performing sector.
Market Commentary
Spotlight of the Week
EURUSD: The European Central Bank raised its benchmark interest rates by 0.25% to 1.25% last Thursday. This was the first increase in interest rates by the ECB since 2008. ECB President Jean-Claude Trichet commented that the rate increase was intended to help maintain price stability in the face of rising inflation concerns Although President Trichet added that markets should not expect a quick series of further rate hikes, economists still expects borrowing rate to be increased in July and October if inflationary pressure escalates further. Rate hike expectation will probably keep euro strong against U.S. dollar.
Market Summary
* Precious Metals: Gold prices climbed to a new record high last week, above $1470 an ounce. This is gold’s biggest weekly gain in four months. Inflationary fears and a weaker dollar increased gold’s appeal as a currency alternative and hedge against inflation. Based on data from the CFTC, hedge-fund managers and other large speculators increased their net-long position in New York gold futures in the week ended April 5. Net-long positions rose by 11,585 contracts, or 6%, from a week earlier.
* Crude Oil: U.S. crude oil futures rallied, climbing by more than 4% to the highest level in 30 months. This is the third consecutive week that crude oil prices have gained. While unrest in the Middle East simmered, a decline in the dollar spurred a broad rally in commodities. Money managers raised their netlong crude oil futures and options positions in the week through April 5 by 13,231 to 305,297. The EIA reported that U.S. crude inventories rose by 1.95 million barrels to 357.66 million barrels in the week to 1 April.
* Currencies: Euro strengthened against U.S. dollar as European Central Bank raised its benchmark interest rates by 0.25% to 1.25%. This was the first increase in interest rates by the ECB since 2008. Euro rose despite Billionaire investor George Soros said the European Central Bank’s decision to raise its benchmark lending rate was inappropriate because several euro member countries are suffering from too much debt. Japanese Yen weakened against the U.S. dollar due to concerted effort from global central banks to keep Yen weak, in an effort to help Japan recover from the devastating earthquake.
* Indices: S&P 500 fell this week as crude oil’s rally to a 30-month high spurred concern that the global economy will slow. Oil advanced as NATO escalated its air campaign over Libya and on concern unrest may spread to other energyexporting countries in the Middle East. MSCI Singapore Index gained 2.15% for the week ending April 8, 2011. Seven stocks rose for each that fell in MSCI Singapore index of 32 companies. Financial sector is the best performing sector while Telecommunication sector is the worst performing sector.
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