Analytics, News, and Forecasts for CFD Markets: currency news — 23-02-2011.

USD/JPY recovered to Y82.67 but failed to hold higher and retreats again. rate currently holds around Y82.47, above earlier lows around Y82.30. Bids still at Y82.20 and lower with offers in place at Y82.90 and above.

Stocks are trying to extend a recent push up from the 1300 line. In turn, the S&P 500 and Nasdaq Composite are at their best levels in over an hour.
Oil prices have pulled back in recent trade. The energy component set a new 2-year high of $100 per barrel earlier, but it is now at $98.90 per barrel with a 3.7% gain.

• against a sharp tightening in monetary policy

• inflation set to fall back rapidly to its 2.0% target during 2012

•  Price stability deeply entrenched in medium- to long-term expectations

• Big, lasting inflation differentials can be cause of concern

• Price stability deeply entrenched in medium- to long-term expectations

• Big, lasting inflation differentials can be cause of concern

The dollar fell against most of its major counterparts on speculation central banks in Europe and the U.K. will seek to combat inflation from rising fuel costs by increasing interest rates before the Federal Reserve.
The euro climbed to an almost three-week high versus the greenback.

The pound gained versus the dollar as minutes of the Bank of England’s Feb. 10 meeting showed an additional policy maker backed an increase in rates.
“You’re still seeing euro and sterling who have more people on their central banks talking hawkish; it’s beneficial for their currencies against the dollar at this stage,” said Brian Kim, a currency strategist at UBS AG. Libyan and Mideast turmoil “pushes oil higher, and that feeds into commodity prices pushing short-term inflation, reinforcing perceptions those central banks may do something.”
European Central Bank policy makers will make the decisions necessary to maintain price stability, ECB President Jean-Claude Trichet told reporters today. The ECB will “inevitably” have to “rebalance our monetary policy stance,” with the 17-nation euro-area economy strengthening and inflation in breach of the central bank’s 2% limit, council member Yves Mersch said yesterday, without giving a time frame.
Governments rushed to evacuate thousands of expatriates from Libya as army units defected and a former aide to the leader Muammar Qaddafi warned that the spreading revolt may topple the regime within days. The nation holds Africa’s largest crude reserves.
Crude for April delivery rose as much as 6.8% to $99.94 a barrel in New York, the highest level since October 2008. In London, it gained as much as 5.7% to $111.85, the highest since September 2008.
Sterling gained after minutes of the Bank of England’s Feb. 10 rate decision showed Spencer Dale joined Andrew Sentance and Martin Weale in voting for higher rates as an increasing number of officials said the case for tightening policy had “grown in strength.” The central bank has held the rate at 0.5% since March 2009.

The S&P 500 has dropped to a 1% loss, which comes on top of its 2% loss during the prior session. However, the benchmark Index has been able to steady itself after securing support in the 1302 zone.
Corporate news offered little support to stocks. The latest round of earnings was headlined by Hewlett-Packard (HPQ 43.10, -5.13), which reported an upside earnings surprise, but that was tainted by a light revenue figure and a disappointing forecast. TJX Co (TJX 48.18, -1.54) had an upside surprise of its own, but also issued a disappointing outlook. Lowe's (LOW 25.33, -0.66) and Toll Brothers (TOL 20.45, -0.31) both had better-than-expected earnings.

April contract is now the front WTI contract and worries over the middle east continue to keep upside pressure on oil. April WTI is up a very solid $4 on the day, trades at $99.45 currently but saw prints atop $99.60 just a few moments ago.

EUR/GBP triggered offers between stg0.8470/80 and currently holds around stg0.8485. Cross rises after euro. Further offers stg0.8500, stronger at stg0.8525/30.

GBP/USD rises following by euro-dollar, but rate still seen holding off earlier highs at $1.6275, seen after the release of hawkish BOE Minutes. Pound may $1.6280/00 to continue rising. Options at $1.6300.

EUR/USD  $1.3610, $1.3640, $1.3650, $1.3700
USD/JPY Y81.25, Y81.40, Y81.45, Y81.50, Y82.50, Y83.45, Y83.50
GBP/USD $1.6100
AUD/USD $0.9950, $0.9880, $0.9845
USD/NZD $0.7500, $0.7490

U.S. stocks were set to open higher Wednesday, following a sharp sell-off in the previous session and ahead of a key report on existing home sales.

Libya's escalating political crisis sparked a sharp sell-off in U.S. stocks Tuesday, with the three major indexes posting their biggest one-day drops of the year and as oil prices continued to skyrocket.

Economy: The spotlight returns to real estate Wednesday morning, as the National Association of Realtors releases existing home sales numbers for January at 15:00 GMT.
Existing home sales are expected to slip slightly, to 5.23 million units on an annualized basis.
On Tuesday, the latest S&P/Case-Shiller home price index report indicated that national home prices fell 4.1% during the last three months of 2010, compared with 12 months earlier.
Companies: Before the opening bell, Home Depot (HD) rival Lowe's (LOW) reported quarterly earnings that beat analysts' expectations. Shares were up 3% in premarket trading.
Luxury homebuilder Toll Brothers (TOL) also surprised investors, reporting quarterly earnings of 2 cents per share. Analysts had forecasted a loss of 7 cents per share. Shares were up 3% in premarket trading.
Still to come, retail department store Saks (SKS) is scheduled to report quarterly results later in the morning.
Shares of Hewlett-Packard (HPQ) were down 10% in premarket trading, after the computer company issued an outlook and quarterly sales figures that disappointed investors.
World markets:

Oil for April delivery gained 55 cents to $95.97 a barrel.
Gold futures for April delivery rose $3.40 to $1,404.50 an ounce.
The price on the benchmark 10-year U.S. Treasury dipped slightly, with the yield pushing up to 3.48% from Tuesday yield of 3.46%.

EUR/USD
Offers: $1.3745/50, $1.3765/70, $1.3800, $1.3825/30, $1.3860/65
Bids:$1.3725, $1.3700, $1.3680, $1.3650, $1.3620

The euro gained for the first time in three days versus the dollar on speculation rising fuel costs will put further pressure on European Central Bank policy makers to combat inflation with higher interest rates.
Oil prices surged to a two-year high amid intensifying violence in Libya.
“The market is focusing more on prospects for higher interest rates and this speculation should offer further relief for the European unit,” said Roberto Mialich, a senior currency strategist at UniCredit SpA in Milan. “The Federal Reserve’s position is very clear; the U.S. outlook is still uncertain and they don’t want to raise rates too soon.”
ECB officials will “inevitably” have to “rebalance our monetary policy stance,” with the 17-nation euro-area economy strengthening and inflation in breach of the central bank’s 2 percent limit, council member Yves Mersch said yesterday, without giving a time frame. ECB President Jean-Claude Trichet and council member Guy Quaden will speak in Liege, Belgium, later today.
The pound gained versus the dollar and euro as minutes of the Bank of England’s Feb. 10 interest-rate meeting showed three members of the policy-setting committee voted for an increase.
Spencer Dale joined Andrew Sentance and Martin Weale in voting for an interest-rate increase by the Bank of England this month as a growing number of officials said the case for tightening policy had “grown in strength,” minutes released in London today showed.
The New Zealand dollar, known as the kiwi, strengthened earlier after Moody’s Investors Service said it sees no immediate impact from the Christchurch earthquake on the nation’s Aaa credit rating.

US data continues at 1500GMT, when the pace of existing home sales is forecast to slow to 5.25 million in January following the 12.3% surge in December.

USD/JPY
Offers: Y82.90, Y83.25, Y83.55/60
Bids: Y82.45/50, Y82.20, Y81.75/80

• Well on way to getting economy growing again

Posts a fresh high on the day of Y113.77 as euro-dollar rechallenges the earlier highs, and dollar-yen chews through exporter offers ahead of Y83.00. Some resistance seen ahead of yesterday's high of Y113.92 and Monday's high of Y114.24.

Traders reporting some good demand for euro-aussie, but the cross remains contained to a tight A$1.3650/85 range in europe this morning. Talk of stops now positioned for a break of $1.3700 layered up to $1.3730. Cross trades A$1.3665/68. Resistance comes around A$1.3694. Support remains on approach to A$1.3650/45.

EUR/USD  $1.3610, $1.3640, $1.3650, $1.3700
USD/JPY Y81.25, Y81.40, Y81.45, Y81.50, Y82.50, Y83.45, Y83.50
GBP/USD $1.6100
AUD/USD $0.9950, $0.9880, $0.9845
USD/NZD $0.7500, $0.7490

• Spencer Dale Joins Weale In Voting For 25bps Hike
• Sentance Ups Rate Hike Call To 50bps From 25bps Prior
• Posen Votes For stg50bln QE Expansion; Rest Vote No QE Change 
• Most Members Agree Case For Tightening Has Strengthened 

Commerzbank has reported Q4 net income of E257 mln versus analysts estimates of E169 mln. FY net income was E1.4 bln versus analysts estimates of E1.22 bln.