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Euro Champ, Dollar Chump!
By Mike Conlon | January 19, 2011
The Euro has been higher against the Dollar 7 of the last 8 days as the Dollar has put in an 8-week low as a result of the sluggish US economy. This morning the US reported declining housing starts which missed analyst forecasts, though there was an increase in mortgage applications and building permits.
This highlights the difference in market sentiment in that the early Dollar strength this year was more a function of concern over the Euro debt crisis and less about the perceived strength of the US economy.
In the UK, fewer people made jobless claims, though the unemployment rate remained steady
By Mike Conlon | January 11, 2011
The Aussie is once again lower as flooding continues to ravage the country. This could have a seriously negative effect on the Australian economy, as this is the worst flooding in nearly 100 years. Here in the US, we are bracing for another major snowstorm along the eastern coast, which could also cause an economic slowdown. This could have inflationary consequences in the energy sector, as supply and demand are affected accordingly.
One region whose climate is looking better is the Euro zone, as overnight Japan said they would be looking to buy Euro bonds to help the support the region. While not truly a philanthropic venture, this makes sense from
By Mike Conlon | January 7, 2011
This mornings trading action was not lacking for excitement as the major volatility ensued after the release of the Non Farm Payrolls report. The jobs added figure was disappointing, showing that we gained 103K jobs, vs. an expectation of a gain of 145K.
However, the unemployment rate came in better than expected, showing it decreased to 9.4% from 9.8%. Analysts were expecting the rate to come in at 9.7%. This number is very questionable as December is usually a tough month to gauge due to seasonal employment and the number of people leaving the workforce. My guess is that the latter had more to do with this figure
By Mike Conlon | January 6, 2011
No, Im not talking about the Al Gore hocus-pocus with regard to global warming, err make that cooling, no its warmingbut rather the changes taking place in Washington DC. Just yesterday a new Congress was sworn in after last years elections with the intentions of promoting a more friendly business environment which will hopefully put more people back to work and improve economic conditions.
This week the employment reports are hopefully going to show an increase in positive sentiment as the market is anticipating policies intended to help business, not attack it. Yesterdays ADP employment change figures were a step
By Mike Conlon | January 5, 2011
The US dollar is higher across the board as better than expected economic data continues to come in, highlighting the fact that economic recovery in the US may be taking place. However, the market is sending mixed signals as commodities prices are lower again today, with falling demand being cited as the reason.
But wouldnt an improving US economy increase demand? Well I guess that depends on your point of view. As I have been saying all week, the market correlations that so many have relied on in the past are beginning to break down a bit. However this morning appears to have started out as a classic risk aversion