CEP News) - Asia-Pacific fixed income markets are gaining and equities closed mixed with yields on Australian 10-year bonds down 8.4 bps to 4.36% and Japanese 10-year government bonds down 2.1 bps to 1.32%. Sydney's S&P ASX 200 closed up 38.70 points to 3508.6. The Japanese Nikkei closed down 107.59 points to 7969.03 and the Hang Seng up 93.15 points to 13748.19. Yields on three-year Australian bonds were down 9.0 bps to 3.79 and the Australian 90-day September 09 contract was up 1.0 tick to 97.11. The Euroyen September 09 contract was up 1.0 tick to 99.49. The Australian dollar was down 0.80 cents to 0.6669 against the USD and down 0.59 cents to 0.8184 against the Canadian dollar. Against the yen, the U.S. dollar was down 0.72 points to 91.17 and the Canadian dollar was down 1.07 points to 74.28. The euro was down 0.30 cents to 1.2909 USD. All data taken at 2:50 a.m. EST. Generated by CEP Newswires

(CEP News) - Risk appetite is helping to boost the euro against the U.S. dollar in afternoon trading, but gains could be limited and the euro will have trouble breaking through strong resistance, strategists say. The euro managed to break through 1.29 but has so far not been able to hold gains. This afternoon, the euro is up a full cent to 1.2892 EUR. The broader range of 1.27 and 1.30 remain firmly in place. Marc Chandler, global head of currency strategy from Brown Brothers Harriman, said he would need to see a "convincing" break of the 1.3040 USD to expect further gains in the cross. Although the euro is up against the U.S. dollar, it is lagging behind some of the other currencies like the Aussie and kiwi dollar, which are the two top performers against the greenback. Tyson Wright, currency trader at Custom House, said the outlook for the euro still remains negative and that he expects the euro to continue to underperform as the European economy continues to weaken. "The euro has just not participated in the rallies today and I think that is very bearish," he said. According to several strategists, one of the key reasons for the euro's underperformance is because ...

(CEP News) The sharp drop in Canadian employment has caused sentiment to shift against the Canadian dollar and now strategists are looking for opportunities to go long USD/CAD. The Canadian economy has held up fairly well compared to other countries. However, according to Tyson Wright, senior FX Trader at Custom House, January's employment report shows that the economy is just as bad, if not worse than others. The Canadian dollar weakened significantly following the unemployment report, but gains in the cross were capped at 1.2541 CAD. Wright pointed out that risk appetite, which has supported equity markets, is also helping to support the loonie. Since the highs reached this morning, USD/CAD has lost about 1.60 cents and is showing only modest gains, trading up 0.60 cents to 1.2383 CAD. Despite the recovery this afternoon, today's soft data will to lead to a fundamental shift in currency markets as more weakness is priced into the Canadian dollar, Wright said. "I've changed my focus and now I want to be long USD/CAD," he said. Nick Bennenbroek, head currency strategist at Wells Fargo, said he sees few bright prospects for the Canadian dollar. He said Markets were optimistic that the Canadian economy could recover from the global economic weakness, but after the January report those hopes have been broken. He added that the Canadian ...

(CEP News) - Another round of debate in the U.S. Senate over the fiscal stimulus plan coupled with the Canadian and U.S January employment reports highlight the main economic events of the day as markets brace for another half a million job losses in the United States.After failing to vote on the U.S. fiscal stimulus plan on Thursday evening, the U.S. senate will continue deliberations on Friday as some lawmakers attempt to bring down the $920 billion price tag. MSNBC says that some lawmakers expect deliberations to go into the weekend. At 7 a.m. EST, Statistics Canada will release Canadian payrolls for January. Economists expect a 40.0k decline in Canadian jobs following a 20.4k drop in December, which would bring the unemployment rate higher by 0.2 percentage points to 6.8%. At 8:30 a.m. EST the U.S. Bureau of Labor Statistics' will release its employment report for January. Nonfarm payrolls are expected to fall by 540k jobs after declining 524k in December. The unemployment rate is expected to rise to 7.5% from 7.2%. Manufacturing payrolls are expected to pull back by 145k jobs, compared to the previous month's 149k decline. Average hourly earnings are expected to rise 0.2% month-over-month following December's 0.3% increase. ...

(CEP News) - The U.S. economy is "severely depressed" and the country will encounter "horrific" deficits in the long run, Federal Reserve Bank of San Francisco President Janet Yellen said on Friday."The economy is in the midst of a downward spiral, and that calls for strong policy responses," Yellen said while speaking at the 128th Assembly for Bank Directors in Hawaii Despite the dire warnings, the Fed president said the economy may begin to improve late this year with aggressive policy action by the Fed and U.S. government. "Government policies to restore confidence, create jobs by boosting the demand for goods and services, and improve the functioning of our financial system, represent our main hope of avoiding a very severe economic contraction," she said. "My best guess is that we may see economic activity begin to grow late this year as housing construction stabilizes and the financial sector begins to heal." She said the global economic downturn may last for "some time," and that timely fiscal stimulus is needed to moderate the "downward spiral." She noted further that removal of bad assets is required in order to restore banking. "The case for policy actions - by both the monetary and fiscal authorities - to arrest ...

The markets have surged in early trade on the back of a sharp decline in inflation numbers. Also, overnight rally in Wall Street has given a boost to the benchmark indices. The Sensex is up over 200 points while the Nifty has advanced 75 points. “Though, Dow rallied yesterday, high volatility across global markets remains a key concern. Moreover, economic fundamentals would remain under stress for the next 12 months and commodities could remain under pressure in near term,” said Vetri Subramaniam, Vetri Subramaniam, Religare Aegon Asset Management. Heavy buying has emerged in realty, metals and bank stocks. The realty index on the BSE is up over 4.5 per cent and the metal index has gained 3.4 per cent. BSE Bankex has surged 3.3 per cent while capital goods index is trading 2.5 per cent higher. “Despite positive opening, market movement would remain subdued. At this point, outcome of the G-20 meeting is being awaited by the markets,” said Pankaj Pandey, Head(Research), ICICI Securities. Among the Sensex stocks, JP Associates leads gainers. It is up 5.5 per cent. Reliance Infra, Satyam Computers and RCom are the other main gainers in the group. Investors did an abrupt turnaround on Wall Street on Thursday, muscling the Dow ...

A downpour in Washington has a new meaning at the G20. On a gloomy, rainy afternoon, 20 heads of state including India, the UK, the US, France and all other G20 members, will meet to decide the future of the global economy. George Bush set the agenda in a speech to Wall Street saying free market capitalism will be the key message at the G20 over the weekend. George Bush said the “aim should not be more government. It should be smarter government.” Bush believes the current crisis is "a decisive moment for the global economy" and that like any other system, capitalism is not perfect. Members of the G20 have varied expectations from this meet. The optimists are looking for stronger regulation for the excesses in the system. The realists are certain a weekend meeting will not end the woes of the economy or even Wall Street for lack of an agreed-upon cause of this crisis. The pessimists are sure that with a lame duck President, though can still call the shots, any package will not be convincing or confident. G20: Who's Saying What? Germany: Chancellor Angela Merkel has called for far-reaching regulation. USA: President Bush says G20 is the key to the global ...

Investors did an abrupt turnaround on Wall Street on Thursday, muscling the Dow Jones industrial average up more than 550 points after driving it down near its lows for the year on a stream of negative economic and corporate news. After three days of selling that wiped out about $1 trillion in shareholder value, many investors, though nervous about a prolonged economic downturn, appeared convinced the market had priced in enough bad news. So when the Standard & Poor's 500 index — the indicator most watched by traders — managed to recover from multiyear trading lows, buyers swarmed back in. It's "a herd mentality," said Ryan Larson, senior equity trader at Voyageur Asset Management. "We started going higher — and you don't want to be the last one on the boat." The market was following in dramatic fashion its pattern of huge price reversals, one that was set early in the now 15-month-old credit crisis and that has become almost the norm on Wall Street. Some analysts said investors were positioning themselves ahead of a meeting of Group of 20 leaders in Washington. The meeting could bring decisions on mending the troubled global financial system. The G-20 includes the U.S., Argentina, Australia, Brazil, Britain, ...

British Telecom, which has a large offshore presence in India, today announced plans to cut 10,000 jobs by March 2009 after its pre-tax profits slumped by 11 per cent in the first six months of the current year. The cuts will mainly affect agency and contract staff and offshore workers, the company said. This is expected to include job losses in the company's operations in India. BT has a global workforce of 160,000. Latest figures show that British unemployment has hit an 11-year high of 1.82 million during the three months to September and is forecast to peak at 3.3 million by 2011. BT said that most of the job losses would be among contract, agency and offshore workers. Sub-contractors and other indirect employees would also lose their jobs, the group said. Ian Livingston, chief executive of BT, described the action BT was taking as "decisive". BT said the move was aimed at reducing its dependence on consultants and contractors. About 4,000 of the job losses will be direct BT staff, the remaining 6,000 will be from related employees. BT admitted that its performance was "disappointing" and the results in its struggling Global Services division were "simply not good enough", where earnings before interest, tax, ...

The markets are weak in early deals with the Sensex trading well below the 10K mark. Heavy selling has emerged in realty, metal and banking stocks. The Nifty is trading 2.7 per cent lower. “Even if IIP numbers are positive then too it would not make too much of a difference for the markets. GDP at 7.5 per cent has already been factored in and this would get reflected in the IIP numbers,” said Sandeep Shenoy, Head of Equities, PINC Research. Heavy selling has emerged across the board. The realty index on the BSE is down over 5 per cent and the metal index has shed 3.4 per cent. BSE Bankex has lost 3 per cent while oil&gas index is trading 2.8 per cent lower. “US recession is long drawn out and markets would remain muted. Markets are still not factoring slowdown in earnings and may test October lows in near term,” said Sandeep Bhardwaj, CEO and Head Equity Strategy, Tower Capital & Securities. Realty major, DLF, leads losers in the Sensex pack. It is down 7 per cent. Hindalco, JP Associates and ICICI Bank are the other main losers in the group. U.S. stocks fell on Tuesday on a wave of worrisome news that ...