InvestMacro FX

McDonald’s (MCD) today had its estimates and price target reduced by Credit Suisse (CS) due to lower realized sales. A $104 price target was issued with an outperform rating.

In trading on Monday, cigarettes & tobacco shares were relative leaders, up on the day by about 1.1%. Leading the group were shares of Star Scientific (CIGX), up about 2.6% and shares of Universal VA (UVV) up about 2.4% on the day.

As the saying goes, there are many possible reasons for an insider to sell a stock, but only one reason to buy — they expect to make money. So let’s look at two noteworthy recent insider buys.

Spanish Prime Minister Mariano Rajoy welcomes euro zone finance ministers’ agreement to lend Spain up to 100 billion euros. Deborah Lutterbeck reports

By CountingPips.com

The latest Commitments of Traders (COT) report, released on Friday by the Commodity Futures Trading Commission (CFTC), showed that large futures speculators boosted their overall US dollar long positions last week for a fifth consecutive week and euro short positions once again increased to a new record high.

Non-commercial futures traders, including hedge funds and large speculators, increased their total US dollar long positions to $39.65 billion on June 5th from a total long position of $37.5 billion on May 29th, according to the CFTC COT data and calculations by Reuters which calculates the dollar positions against the euro, British pound, Japanese yen, Australian dollar, Canadian dollar and the Swiss franc.

Individual Currencies:

EuroFX: Currency speculator sentiment decreased for the euro currency once again last week as euro net short positions or bets against the currency rose to a new record high for a fourth consecutive week. Euro short positions increased to 214,418 contracts on June 5th from the previous week’s total of 203,415 net short contracts on May 29th. This is the fourth straight week of a new record level and a fifth straight week of decline overall.

The COT report is published every Friday by the Commodity Futures Trading Commission (CFTC) and shows futures positions as of the previous Tuesday. It can be a useful tool for traders to gauge investor sentiment and to look for potential changes in the direction of a currency or commodity. Each currency contract is a quote for that currency directly against the U.S. dollar, where as a net short amount of contracts means that more speculators are betting that currency to fall against the dollar and net long position expect that currency to rise versus the dollar. The graphs overlay the forex spot closing price of each Tuesday when COT trader positions are reported for each corresponding spot currency pair.

GBP: British pound sterling positions decreased last week for a fourth straight week after peaking at the highest level in over a year on May 8th. British pound positions have now fallen back over to the short side and saw a total of 2,867 net short contracts on June 5th following a total of 1,475 net long contracts registered on May 29th. This is the first time pound sterling contracts have been on the short side since April 17th when positions totaled 13,051 short contracts.

JPY: Japanese yen speculative contracts improved last week for an eighth consecutive week and rose over to a total of long contracts for the first time since February. Yen positions totaled 12,073 net long contracts reported on June 5th following a total of 11,330 net short contracts on May 29th. Japanese positions have benefited from the surge in risk aversion in the markets and the JPY is now at its best level since February 20th when contracts equaled 17,257 long positions.

CHF: Swiss franc speculator positions decreased after improving slightly the previous week. Speculator positions for the Swiss currency futures registered a total of 33,648 net short contracts on June 5th following a total of 30,596 net short contracts as of May 29th.

CAD: Canadian dollar positions declined sharply last week and for a fifth consecutive week after reaching the highest level of the year on May 1st. Canadian dollar positions declined to a total of 14,906 net long contracts as of June 5th following a total of 34,085 long contracts that were reported for May 29th. Canadian dollar contract are now at the lowest level since February 13th when positions equaled a total of 9,566 long contracts.

AUD: The Australian dollar positions dropped sharply for a fifth consecutive week and brought Aussie positions further negative after crossing over to the short side on May 22nd. Aussie positions dropped to a total net amount of 51,172 short contracts on June 5th after falling to 35,527 net short contracts as of May 29th. AUD speculative positions are at the lowest level since at least 2009 as the reserve Bank of Australia has cut interest rates and growth out of China, which fuels Aussie strength, has cooled.

NZD: New Zealand dollar futures speculator positions slightly declined and fell for a seventh straight week. NZD contracts decreased to a total of 5,530 net short contracts as of June 5th following a total of 5,208 net short contracts on May 29th. The kiwi contracts have now been on the short side for three consecutive weeks.

MXN: Mexican peso speculative contracts decreased after improving slightly the previous week. Peso positions fell to a total of 30,396 net short speculative positions as of June 5th following a total of 12,995 short contracts that were reported for May 29th. Mexican peso contracts are now at their lowest level since November 28th 2011 when positions equaled 36,240 short contracts.

COT Currency Data Summary as of June 5, 2012
Large Speculators Net Positions vs. the US Dollar

EUR -214418
GBP -2867
JPY +12073
CHF -33648
CAD +14906
AUD -51172
NZD -5530
MXN -30396

The world’s first solar transcontinental flight landed early this week. Swiss aviator Bertrand Piccard flew the one manned aircraft from Spain to Morocco in 20 hours. The plane is powered by 12000 solar cells embedded on the tremendous wing span (just under 200 feet) and glides as much as it flies with it’s solar powered propellers. Reaching speeds of up to 74 mph, the plane cruises at around 35, weighing little more than your average car. Costing roughly $10mil, solar powered flight is still not the best solution to lowering fuel consumption, braving rough weather or making your meeting across the pond, but we’re flying in the right direction.

Bloomberg reports that several foreign airlines, including ones in Singapore and Australia are experimenting by replacing the in seat television sets with $15 Ipad rentals. These Ipads will come preloaded with games, movies, shows, and other forms of entertainment, including web browsing. The elimination of in seat television sets will greatly reduce the carrying weight of planes, increasing flight speed and economize fuel consumption. On a Boeing 777, for example, shedding the screens saves 7% weight–even after adding 40% more seats. In a harder translation, airplanes without screens stand to be able to carry over a ton more fuel than the same planes with screens. US airlines seem a bit more hesitant to make such drastic changes. Delta is reportedly experimenting with dollar or less downloads of movies and games for passengers to use on their personal computers and devices. Some downloads may cost up to six dollars for more premium content, and it would be removed after the flight is over. Indian Airlines have started actually expanding their screens adding the touch screen technology of today’s smart phones, so I can’t say that the Ipad move marks a trend, yet. Current screen manufacturers like Panasonic haven’t shown concern over the fad yet, but with rising fuel costs, competing technology for alternative fuel sources(which necessitates lighter vehicles), will demand airline entertainment reform.

Nokia jumped as much as 11% intraday on takeover speculation and this is the largest upside move in 7 months. Market is flooded with chatter that Finland based phone maker Nokia will receive an offer from either Microsoft or Samsung Electronics, so let’s talk about it.There is no tangible evidence any bidding is happening. The Korea based Samsung is a pioneer in making smart phones and Nokia doesn’t complement what it does. Microsoft, on the other hand, might be looking for a handset partner for the Windows Phone 7, but Nokia is probably not first one it reaches out to.Nokia share prices declined 41% YTD. Its market share has been eaten away by the iPhone since 2007, and later was further attacked by other smart phones running Google’s Android software, so unfortunately, it’s no longer a competitive producer.For those of you trading this space, I’d like to hear from you. You can send in your comments to our show or tweet me (@juliasun_onair). I’m Julia Sun for the Financial News Network.

This twenty third trading week of 2012 comes to a close with investors monitoring events in Greece and Spain while investment banks and exchanges continue to point fingers and answer tough questiosn about the Facebook (FB) IPO. Hi.

Here’s what’s to watch, Friday, June 8th. Topping our news today, NASA puts their interstellar creativity to the test as top scientists hold bake sales to protest the proposed $300 Million cut being weighed buy congress. Senator Rand Paul announced his endorsement of Mitt Romney for president, but added the caveat that he really preferred his father, Texas Congressman Ron Paul, to have been nominated. Samsung billionare Chairman Lee Kun Hee is being sued by his two siblings for an $850 Mill stake in the corporation, this after a $237 Billion of revenue last year. Apple products find their way into a new market, the airline industry, as some airlines weigh the options of light ipad rentals versus heavy wiring and components needed for back of seat displays. And finally, also taking to the air, the first transcontinental solar powered flight. All this and more will be in the news today on the Financial News Network.