Bobbys Corner-Open Market-December.2.2011

Good Morning:

Many traders stayed on the sidelines ahead of this morning’s US employment data.

In Euro Zone news- German Chancellor Merkel commented that joint Euro Bonds are are not the way to solve the debt crisis.  She also agreed that the ECB should not be the lender of last resort for the Euro Zone.
Chancellor Merkel stated that  the crisis will take years to clean up and get the region’s finances back on track.
Continued talks between the ECB and IMF will hopefully result in some shared responsibility by both parties.
Merkel and French President Sarkozy will meet ahead of the European summit next week-as these 2 countries have the most to lose from a Euro breakup-or any disconnect in the Euro Zone. 

This morning’s Us employment data is expected to have NFP increase by 125K-but many are calling for over 200K.  These additions will unlikely put a dent the overall unemployment picture.

HAVE A GREAT DAY-WEEKEND & GOOD LUCK

Bobbys Corner-Open Market-December.1.2011

Good Morning:

The euro picked up against the USD and JPY-after Spain and France had good bond auctions.  The euro also showed strength after six central banks acted together to cut the borrowing costs of USD.   
Spain sold 3.75 billion euros of bonds-which was the maximum target of 5 year notes-with a yield of 5.544% compared to 4.848% at the last auction on Nov.3.
France sold  1.57 billion euros of 10 year bonds at 3.18%-slightly lower than the 3.22% at the Nov.3 auction.
Comments from ECB President Draghi describing the role of the ECB, and that the ECB will be willing to do more-if policy makers do there job, and get their act together.

The continued sovereign debt crisis in Europe will be a main focus of the markets.  The action by the 6 central banks yesterday was positively embraced by investors.  The fact that this action was needed-shows how dire the bank funding situation is.

Jobless claims were higher-up 6K to 402K.

Remember-tomorrow is the US employment data report.
Non Farm Payrolls  are expected to be up 120K-and the Unemployment rate should stay at 9%.

US Futures are slightly lower
Gold is up-Oil is down.

HAVE A GREAT DAY & GOOD LUCK

Bobbys Corner-Open Market-November.30.2011

Good Morning:

The euro dropped early in the overnight session (1.3258).  During this time comments by a representative from Peoples Bank of China regarding a cut in reserve ratios set by the government,  this sent the Shanghai index down 3.3%.   Then comments by a Italian regulator that there is a risk of a euro breakup if the ECB does not change it’s role, and get more deeply involved in the Euro Zone’s financial crisis caused the single currency to loose steam.

Irish PM Kenny stated that he sees “real and present danger” from the current EU crisis.  He feels that the crisis is spiraling out of control-and European leaders must make decisive actions and decisions. 
EU finance minister are going to look at the IMF and not just the ECB to help out during this crisis.  This comes on the heels of conceding that the bailout fund has missed it’s target.

ADP payrolls printed at 206K-much better than the 130K the street had predicted.

Today we have Chicago PMI data-and the Beige Book will be released at 2PM this afternoon.

HAVE A GREAT DAY & GOOD LUCK

Bobbys Corner-Open market-November.29.2011

Good Morning:

American Airlines parent AMR Corporation filed for bankruptcy this morning.   After they failed to reach cost cutting agreements with their labor unions-along with missing out on the mergers that have been common in the industry-and losing market share-there was no choice but to seek chapter 11 protection.

In European news-A very choppy overnight session.  The euro started to weakened after news from La Tribune in France stated that S&P may be looking to give France a “negative” outlook.
Comments from the German Finance Minister regarding the role of the ECB also added to the markets nervousness.

Italy sold 7.5 billion euros worth of bonds-and kept the yield under the important 8% barrier.  With over 300 billion euros of Italian debt coming due next year-the Italian government cannot afford to lock themselves into 7.5% or higher yields-so I think that EZ officials will need to find a solution to lessen that burden.

Oil is higher-but gold and silver are off a bit.
World equity markets followed Wall Street and rallied.  US Futures are also higher this morning.

HAVE A GREAT DAY & GOOD LUCK

Bobbys Corner-Open Market-November.23.2011

Good Morning:

The GBP dropped to it’s weakest level in 6 weeks-after minutes of the last Bank of England meeting showed that many members of the committee feel the need for an increase in the ongoing stimulus program.
In further news from the Euro Zone-the Euro fell to a 6 week low against the USD as data suggests that the sovereign debt crisis that is plaguing the region will directly effect growth within Europe.
Fitch rating have stated that the continued debt crisis  now facing France-may have a negative impact on their AAA rating.  With the latest increase in French government debt-their ability to absorb any fresh “shocks” will be difficult to control.

World equity markets are lower-as are US Futures.

Oil, Gold, and silver are all lower also.

I want to wish everyone (who celebrates this holiday) a HAPPY THANKSGIVING.

HAVE A GREAT DAY & GOOD LUCK

Bobbys Corner-Open Market-November.22.2011

Good Morning:

France’s 10 year bond demanded a 150+ points premium over German bonds-as Europe’s second largest economy is showing more and more signs of slipping.  France’s current borrowing costs are more than 1% more than the equally AAA rated UK.
Investors are commenting that France is not trading like a AAA credit-as it seems that the marketplace has already downgraded France’s credit.
The credit and debt crisis that started in Greece 2 years ago, and spread it’s wings into Spain,Portugal, Ireland and Italy is now setting it’s sights on France.
 
The major rating agencies reaffirmed the US’s credit grade-and the JPY fell-as this reduced demand for the JPY as a safe haven for investors.
With no end in sight for the European debt crisis-investors will be looking for non euro denominated assets.  With the risk of contagion (and now we see the crisis heading to France), along with rising bond yields-the investment community will be very weary as to what European assets they invest in.

Oil, Silver and Gold are all on the positive side.

World equity markets were mixed-and US Futures are slightly posting positive numbers.

HAVE A GREAT DAY & GOOD LUCK

Bobbys Corner-Open Market-November.21.2011

Good Morning:

It looks like we start the short Thanksgiving trading week with news that the US Congressional ”super committee” is going to announce that they have failed to agree on any significant cuts in the budget.  With no agreements in place-$1.2 trillion in  automatic spending cuts will start.  These cuts are both for domestic and defense projects-and will be put into place in January 2013.
As typical in current US politics, both the Democrats and Republican’s blamed each other for the inaction.  Even Sen John Kerry of Massachusetts stated that on Monday the markets will look at Washington and say “you guys can’t get the job done”.  I think that he is right-and I would add “again” at the end of his statement.
With no agreement from the “super committee”-will the rating agency’s have more negative news for the US’s rating?

World equity markets are lower-as are US Futures.
Oil,Gold,Silver are all lower.

HAVE A GREAT DAY & GOOD LUCK

Bobbys Corner-Open Market-November.18.2011

Good Morning:

The ECB was back in the markets buying Spanish and Italian debt again-but at the same time newly appointed ECB chief Mario Draghi reiterated that the ECB will not become the lender of last resort to the Euro Zone-let’s wait and see what happens.

The GBP gained against the USD-even after comments from the Bank of England that with the weak UK economy-they may consider additional monetary stimulus.  The BOE will most probably start to reevaluate this in the beginning of 2012-after they are able to evaluate the data from 2011.

Italian 10 year bonds are still trading below the 7% handle-which is a very significant psychological level.

World equity markets were and are lower-Dow Futures are higher at this time.
Oil, Gold and Silver are all higher.

HAVE A GREAT DAY-WEEKEND & GOOD LUCK