InvestMacro Forex News

By www.CentralBankNews.info     The European Central Bank (ECB) held its main interest rates steady, including its benchmark refinancing rate at 0.50 percent, and said its president, Mario Draghi, would comment on the decision by the bank’s governing council at a press conference later today.
    Last month the ECB adopted a form of forward guidance, saying it expected to keep rates at their “present or lower levels for an extended period of time.”
    The ECB cut its refi rate by 25 basis points in May.
    In July the inflation rate in the 17-nation euro zone remained steady at 1.6 percent from June. The ECB targets inflation of below but close to 2.0 percent.
    The economy in the euro zone continued to shrink in the first quarter but there have recently been signs that it may start to improve in the second half of the year, leading financial markets to expect that the ECB would maintain rates at today’s meeting.
    The ECB expects the euro zone Gross Domestic Product to shrink by 0.6 percent this year, less than a 1.5 percent contraction in 2012.
    In the first quarter, GDP contracted by a quarterly 0.3 percent, the sixth consecutive quarterly contraction, with the annual growth rate a negative 1.1 percent, up from a contraction of 0.9 percent in the fourth quarter.

    www.CentralBankNews.info

By www.CentralBankNews.info     The Bank of England (BOE) maintained its Bank Rate at 0.5 percent and the size of its asset purchases at 375 billion pounds, adding that it would release its latest inflation and output projections on August 7.
     The BOE, which has held its rate steady since March 2009, also said that its Monetary Policy Committee, as already announced, “will also respond to the UK Chancellor’s request for its assessment of the use of thresholds and forward guidance at that time.”
    The decision to maintain rates and the size of its asset purchase program was widely expected following the release of the minutes from the MPC’s July meeting in which it became clear that the size of the quantitative easing program would likely be maintained while the bank decides on the details of its forward guidance under its new governor, Mark Carney.
    Following Carney’s first meeting in July, the BOE used a mild form for policy guidance, voicing concern over the recent rise in UK bond yields, saying this was weighing on its economic outlook and the implied rise in its bank rate was not warranted by economic developments.

    Bond yields in the UK and in most other countries rose in June following better UK economic data and in reaction to the Federal Reserve’s planned tapering of its asset purchase program.
    Inflation in the United Kingdom rose to 2.9 percent in June from 2.7 percent in May, continuing to remain above the BOE’s target of 2.0 percent.
    The UK economy strengthened in the second quarter with Gross Domestic Product up by 0.6 percent from the first quarter, for annual growth of 1.4 percent, up from 0.3 percent in the first.

    www.CentralBankNews.info
   
   
 

By WallStreetDaily.com

Don’t look now, but the investment world is warming up to Europe.

“There are a few blooms sticking up from the frozen ground,” says Steve Koenig, an analyst at Wedbush Morgan Securities.

Over at BlackRock, Chief Investment Officer, Nigel Bolton, believes that we’ve reached “a significant turning point for equity investors [in Europe].”

Credit Suisse (CS) is a believer, too. The investment giant recently instructed investors to overweight European banks in their portfolios.

Same goes for JP Morgan (JPM). Equity strategists at the firm now expect Europe to enjoy better growth in the second half of the year.

Talk about fashionably late!

You’ll recall, I’ve been banging the contrarian drum on Europe for the better part of the year, recommending the SPDR EURO STOXX 50 Fund (FEZ).

And about one month ago, I also urged you to take advantage of a once-in-a-30-year buying opportunity in European bank stocks via the iShares MSCI Europe Financials ETF (EUFN).

But I’m not here today to establish bragging rights. Instead, I’m here to provide a safe way for skittish investors (i.e. – the non-contrarians) to take advantage of the opportunity in Europe before it disappears.

As Thanos Papasavvas at Investec Asset Management notes, “[Europe is] very underinvested from a global-investor perspective.” But that won’t be the case for long. Here’s why…

Follow the Stock Market’s Lead

Make no mistake, we’re witnessing a data-driven – and therefore, legitimate – change of heart on the part of Wall Street analysts when it comes to Europe.

You see, the economy (and currency) – which was once on the brink of complete and utter disaster – is finally on the road to recovery.

Case in point: the latest reading of the Eurozone PMI Composite Output Index. Any reading above 50 indicates expansion. And it just checked in at 50.4 in July – the highest reading in 18 months.

The data underscores the European Commission’s expectation that the eurozone economies will return to growth in the fourth quarter.

I’ll concede that a GDP growth estimate of 1.4% in 2014 isn’t China-esque. But growth is growth. And it’s a definitive sign that Europe isn’t going to fade to black.

Of course, as I’ve long contested, we only need conditions to transition from “bad” to “less bad” for equity markets to respond. That’s happening. And stocks are responding right on cue…

Over the last month, European stocks are up 8.2% – nearly doubling the return of U.S. stocks.

And European bank stocks are performing even better. After hitting a series of higher lows in late June, the iShares MSCI Europe Financials ETF rallied 9.9% in July.

Now, if you’re still too scared to dip your toes in Europe via one of these ETFs, you can still benefit from the imminent turnaround… With a homegrown opportunity, no less.

Built Ford Tough

Back in May, I introduced a brilliant stock indicator based on Ford (F) F-150 trucks. In short, since small business owners account for a large portion of pickup sales, by gauging sales of F-Series trucks, we can track the health of the overall economy.

And Ford is certainly firing on all cylinders in the United States. Pickup sales, in particular, keep climbing higher. All told, Ford is going to enjoy its best sales year in the United States since the recession hit.

Conditions in Europe haven’t been so rosy. But, again, the data points to an imminent turnaround.

During the company’s quarterly report last week, management noted that European operations still incurred a loss. However, results improved quarter-over-quarter and year-over-year. In other words, the bottom is in.

More importantly, Ford has been able to increase its market share in Europe through the downturn. So as the recovery takes root – and its European operations return to profitability – the company should rake in even more revenue.

Bottom line: Ford represents a unique, safe and cheap way (shares trade for less than 12 times earnings) to profit from a continued recovery in the United States – and the imminent rebound in Europe.

So I’ll pay homage to Jeff Foxworthy and say it again… You might be a redneck if you drive a pickup. But you’d be a pretty darn smart redneck if you also owned a few hundred shares of Ford.

Ahead of the tape,

Louis Basenese

The post The Safest Way to Bet on a Rebound in Europe appeared first on  | Wall Street Daily.

Article By WallStreetDaily.com

Original Article: The Safest Way to Bet on a Rebound in Europe

By www.CentralBankNews.info     The U.S. Federal Reserve will continue to purchase $85 billion of assets a month to support stronger economic recovery and confirmed that a highly accommodative policy stance will remain in place after quantitative easing ends.
     While the Federal Reserve largely repeated last month’s statement, it added that economic activity had  “expanded at a modest pace” in the first half of the year, a slightly weaker description than in June and earlier months when it used the word “moderate” to describe the economy.
    The Fed also added in this month’s statement that inflation “persistently below its 2 percent objective could pose risks to economic performance, but it anticipates that inflation will move back toward its objective over the medium term.”
     Taken together, these two minor changes to its statement may signal that a planned tapering of its asset purchase program later this year could be pushed back further, though the Federal Reserve’s policy-making body, the Federal Open Market Committee, did not make any specific references to this.
    Overall, the Fed still saw diminished risks to its economic outlook, expecting economic growth to improve from its current pace due to its accommodative stance and that the unemployment rate will continue to decline.
    On June 19 Fed Chairman Ben Bernanke said the U.S. central bank would probably start reducing its asset purchases later this year and end the purchases mid-2014 if the economy continues to improve. Financial markets expect the process of trimming asset purchases will begin in September
    The Fed has held its policy rate, the federal funds rate, at 0-0.25 percent since December 2008 and repeated that it will maintain this policy stance for “a considerable time after the asset purchase program ends and the economic recovery strengthens.”
    To give financial markets a better guidance of how long rates will remain at essentially zero, the Fed also repeated that the federal funds rate would remain at this level at least as long as the unemployment rate is above 6.5 percent and inflation does not exceed the bank’s goal of 2.0 percent.
    U.S. Gross Domestic Product expanded by 1.8 percent in the first quarter from the fourth’s quarter’s 0.4 percent for annual growth of 1.8 percent, slightly up from the fourth quarter’s 1.7 percent pace but down from the third quarter’s 2.6 percent.
    The unemployment rate was stable at 7.6 percent in June and May, but up from April’s 7.5 percent while the headline inflation rate in June was 1.8 percent, up from 1.4 percent the previous month and April’s 1.1 percent.

    www.CentralBankNews.info

USDCHF continues its downward movement from 0.9535, and the fall extends to as low as 0.9228. Key resistance is now at 0.9337, as long as this level holds, the downtrend could be expected continue, and next target would be at 0.9170 area. On the upside, a break above 0.9337 resistance will indicate that lengthier consolidation of the longer term downtrend from 0.9751 is underway, then the pair will find resistance around 0.9400.

Provided by ForexCycle.com

By MoneyMorning.com.au

When you break investing down to the basics, there are two key approaches.

And we’re not talking about fundamental or technical analysis.

We’re talking about something different.

And just as it’s possible to combine technical and fundamental analysis, it’s also possible to combine these two approaches.

One of these approaches helped us identify what could be the biggest and most lucrative period for investors in living memory…

To be honest, we don’t really mind which approach we use.

We’ve used both, and they can work equally as well.

The main difference is the direction from which you approach an investment.

We’re talking about ‘top down’ and ‘bottom up’ investing.

If you’re wondering what the heck we’re talking about and how these approaches can help an investor, let us explain…

Should You Analyse Up or Down?

But before we go on, read these two clippings from the same Financial Times article. It will help with the explanation. First:

‘Biotechnology companies are raising money at the fastest rate since the dotcom boom, underscoring the renewed appetite for one of Wall Street’s riskiest bets despite the high chance that the investments will turn sour…‘

And second:

‘Agios Pharmaceuticals, which is developing drugs to treat cancer and rare genetic disorders, raised $122m from an IPO last week and its shares jumped 73.8 per cent on the first day of trading…‘

The first is an example of ‘top down’ analysis (although, in reality there is a level of analysis above the sector level, but we think you’ll get the point).

Top down analysis means looking at something with a wide-angled lens. You’re taking in as big a view of the global economy as you can.

At that point the job of a top down analyst is to work out the biggest trends to impact the global economy. For instance, a top down analyst in the early 1990s may have thought globalisation and electronic communication would be big trends for the next 10 years.

Armed with that worldview, they would have looked for industries and then specific companies to benefit from that view. If the analyst was any good at their job they should have arrived at internet stocks just as the dotcom boom began.

Using a big picture view is how we find breakthrough technologies and stocks in our new Revolutionary Tech Investor investment advisory.

That’s why the FT story caught our eye. Biotechnology is a sector we’re backing heavily in Revolutionary Tech Investor. Half the stocks on the buy list are in biotech.

But as we say, there is another way to analyse stocks, this time from the ‘bottom up’…

It’s Possible to Combine Both Methods

Bottom up analysis is what you’d expect it to be. Instead of taking a big picture view, you look at individual companies. You then analyse how they fit into a particular industry, and the national and international economies.

This type of analysis suits stock scanning or filtering. That is, putting parameters into a stock screening software in order to create a shortlist of stocks.

You may want a list of stocks with a price to earnings (PE) ratio less than 15. Or a list of stocks with a cash balance greater than $1 billion. Or anything else. You may use 3, 4 or 5 filters to cut the stocks down to a final shortlist.

Once you have, say, a dozen stocks, you can analyse each stock for the potential to grow revenues or profits. Alternatively, you may want to find under-valued stocks.

That means looking for companies valued below their peers. If investors then revalue the stock, it could rise without the company increasing revenue and profits (we’ve seen this happen during the dividend stock rally).

As we said at the top of this letter, we use both approaches. They are equally valid. We’re simply looking for the best way to find stocks with the greatest risk/reward potential.

So, how do you analyse stocks? There’s a chance you use one of these methods without even thinking about it. But think about whether you’re a ‘bottom up’ or ‘top down’ investor. Then decide if you’re missing out on good opportunities by limiting the way you research stocks.

What you find out may surprise you. You may even find the other way of researching stocks compliments your current approach, or may even be better.

Cheers,
Kris+

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From the Port Phillip Publishing Library

Special Report: The Sixth Revolution

Daily Reckoning: More Fodder For Our Property Debate

Money Morning: The News Gets Worse, So We’re Buying Resource Stocks…

Pursuit of Happiness: Save Now to Avoid the Government’s Retirement ‘Labour Camps’

Australian Small-Cap Investigator:
How to Make Big Money from Small-Cap Stocks

By MoneyMorning.com.au

It’s almost impossible to predict the future with 100% accuracy. But that won’t stop me taking a stab at it. A big part of our new technology investment service will be working out which technologies have the best chance of succeeding and which will be a flash-in-the-pan.

What follows is just a sample of some of the technologies under development right now. Let me make this clear: I haven’t just made-up a lot of random futuristic ideas. The Revolutionary technologies you’ll read about below are projects being developed in laboratories and research centres round the world…

From hypersonic jet travel to near-space exploration and vacation, to medical and scientific breakthroughs that could rewrite the laws of physics.

It’s impossible to tell how many (if any) of these developments will succeed, but you should know that technology is rapidly changing the world. Even if none of these achieve commercial success, you can be sure that something just as incomprehensible and spectacular will. Read on for our take on the future…

1. Sydney to London and Back Again, Just for a Two Hour Meeting?

When Concorde had its farewell flight on the 26th November 2003 it was a sad day in the progression of high speed intercontinental travel. But not all hope was lost.

The pinnacle of terrestrial travel has been London to Sydney in less than four hours. That required speeds in excess of Mach 5, commonly referred to as the point of Hypersonic Travel.

But the problem is at that speed, current engine technology gets too hot. Air flow reaches temperatures in excess of 1,000 degrees Celsius. That would melt most materials used in typical aircraft, so it’s not a good idea for an engine.

Hence hypersonic travel has been out of reach. But what’s the best way to reduce the temperature of something that’s hot? Cool it. Simple. A joint program between the European Space Agency and Reaction Engines is working on a plane capable of Mach 5 flight cruising speed.

Reaction already has the engine technology. The ESA are working on a body design.

Put the two together and the next step is a fully functioning prototype for hypersonic travel. London to Sydney in four hours may be closer to reality than you think.

2. After China the Next Manufacturing Revolution Could be in Your Home

There’s been a lot of talk about 3D printing for some time.

Some say it’s great, some say it’s a fad. Let’s get one thing straight though. This technology is a part of the revolution in manufacturing that hasn’t happened since stonemasonry was established.

3D printing isn’t just about making Yoda Bobble Heads for your Toyota Prius, or making a plastic gun to shuffle through airport security. It’s about taking this technology and putting the capability to make things into the hands of everybody.

Here are a few things you probably didn’t know 3D printers have done:

• Printed a custom fitted jawbone for an elderly lady that was otherwise going to have to eat through a straw for the rest of her life.
• Printed a trachea splint for a newborn baby who otherwise would have suffocated to death.
• Printed a pizza made from ingredients and protein abundantly found in nature.
• Printed a car. Lightweight, aerodynamic and with the structural rigidity of racing cars.

What this means is it’s not just some gimmick or fad. But a whole new approach to tackling problems to find innovative, creative solutions. It’s a change of attitudes towards the traditionally accepted methods of manufacturing.

3. The Rechargeable Battery That Rewrites the Laws of Physics

The biggest issue with batteries is they run out and take forever to recharge.

The same goes for electric cars.

The bigger problem for electric cars is that if it runs out while you’re on the road, there may not be somewhere to recharge it.

But what if there was an electric car that generated energy from the invisible radiofrequency that is all around us? A car that charged its battery while driving, and never ran out of charge?

Some might say that’s impossible. But Nikola Tesla didn’t think so when he made his Tesla Pierce-Arrow electric car. But that vanished; along with proof his invention in 1931 was even real.

But another man today has made his own version of the free electric car. Ismael Aviso has created an electric motor and battery that has 133% efficiency. In simple terms, it makes more energy than it uses.

It does this by capturing energy from radiofrequency that is invisible, abundant…and free.

Aviso has the world’s first demonstrated free energy engine. Importantly, this isn’t a trick a fake or a scam. The Philippine Department of Energy has also verified Aviso’s invention as legitimate. Aviso has put his engine in a car, and in effect now has a car with unlimited range. No fuel, no recharging…ever.

We’ll be back with part two of this series tomorrow, including why your mind could be the most powerful computer of the future…

Sam Volkering+
Technology Analyst, Revolutionary Tech Investor

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From the Archives…

Is This the Spark to Send Australian Property Crashing?
26-07-2013 – Kris Sayce

Why it’s Deflation…Not Inflation, that’s Heading Our Way
25-07-2013 – Vern Gowdie

Why You Must Avoid This Big Investing Mistake…
24-07-2013 – Kris Sayce

The Dark Side of Technology: Part 2
23-07-2013 – Sam Volkering

The Dark Side of Technology: Part 1
22-07-2013 – Sam Volkering

By The Sizemore Letter

Listen to Charles discuss Ford’s (F) new natural-gas-powered F-150 pickup trucks and what this means for America’s natural gas revolution with Peggy Tuck and Dave Dyer in Part II of today’s  Straight Talk Money.

By The Sizemore Letter

Listen to Charles discuss the GDP numbers, investing globally, and more–including African toilets–with Peggy Tuck and Dave Dyer on Straight Talk Money.