After a flat open, the markets managed to make some impressive gains, continuing last week’s rally. The Nasdaq got a boost from Apple (AAPL), after the company announced plans for a quarterly dividend and also said it would buy back $10 billion of its own shares over 3 years.
Newly elected Socialist party leader Evangelos Venizelos steps down as finance minister to focus on national elections.
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The Bank of Mauritius cut its benchmark interest rate by 50 basis points to 4.90% from 5.40%. The bank said: “The MPC weighed the risks to the growth and inflation outlook over the policy-relevant horizon and concurred that a cut in the Key Repo Rate was warranted in view of the higher downside risks to the domestic growth outlook compared with the upside risks to the inflation outlook. The voting pattern was, however, split with regard to the magnitude of the decrease.”
Previously the Bank of Mauritius cut the rate by 10 basis points at its December meeting, and last raised its repo rate by 25 basis points to 5.50% at its June meeting, after raising 50 basis points in March this year to 5.25%. Mauritius reported inflation of 6.2% in February this year, 6.5% in August, 7.2% in March, and 6.8% in February last year, meanwhile the bank expects inflation to decline to around 5.3% by June 2012 and 4.7% by December 2012.
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.
By Chris Vermeulen, http://www.GoldAndOilGuy.com
This week may provide some trading opportunities for us if all goes well now that most traders are investors are all giddy about stocks again. Last week we saw money move out of bonds and into stocks and the bullishness vibe in the air reminds of many market peaks just before a 5%+ correction in stocks.
Depending how the SP500 unfolds we may be going long or short equities, long precious metals, long bonds, and our VXX trade may spike in our favor.
Bonds: After last week’s strong move down in bonds as the HERD moved out of bonds and into stocks it may be providing us an opportunity to catch a dip or bounce in the price of bonds. If the stock market sees strong selling this week money will run back into bonds.
Looking at precious metals it looks as though gold, gold miners and silver may still head lower this week. The charts are still bearish and pointing to another multi percent drop in value. Gold will look bullish around $1600, Gold miners (GDX) around $48, and Silver around $30 but we need to see one more wave of strong distribution selling for that to take place.
Crude oil has recovered nicely from its 5 wave correction which shook us out of the trade for a profit. I still like the chart for higher prices but with it trading at resistance and a high possibility of sellers stepping back in at this level I am not getting involved here.
The SP500 made a new high last night but has run into sellers early this morning taking prices straight back down. The chart in pre-market looks as though we will see lower stock prices later today and with any luck the fear index (VIX) will continue to rise in our favor.
Watch Live Video Analysis
Chris Vermeulen
http://www.GoldAndOilGuy.com
London Gold Market Report
from Ben Traynor
BullionVault
Monday 19 March 2012, 09:30 EDT
THE SPOT gold price held above $1650 per ounce Monday morning in London – staying within $10 of where it closed last week, but over 4% down on the month so far.
“The market feels a bit top-heavy, which may imply a further correction on the downside to $1600,” warns the latest note from Swiss precious metals refiner MKS.
The silver price fell as low as $32.34 per ounce during Monday morning’s London trade, but rallied back above $32.50 by lunchtime, while commodities were broadly flat on the day.
“Physical [bullion] market activity…has slumped,” says Standard Bank commodity strategist Marc Ground, citing the closure of Indian bullion markets as gold dealers held a three-day strike following the government’s announcement last Friday that it is doubling import duties on gold, as a percentage of the gold price, for the second time this year.
Over in China, the world’s second largest gold consumer after India, average property prices fell last month in 45 of 70 cities surveyed an official report published by the National Bureau of Statistics on Sunday finds.
European stock markets were broadly flat this morning ahead of news that Apple plans to pay a dividend of $2.65 a share and launch a stock buyback program, while US Treasury bonds gave up early gains.
Investment bank UBS cut its gold price forecasts on Monday. UBS’s one-month forecast was cut from $1775 per ounce to $1550, while the three-month forecast fell from $1950 to $1600.
“We see gold now in a challenging environment,” says UBS precious metals strategist Edel Tully, who won last year’s London Bullion Market Association gold forecast competition.
“In as much as higher US [Treasury bond] yields reflect an improvement in sentiment towards growth, rather than nervousness about sovereign credit or inflation, we think gold buyers will be reluctant.”
Economists at Barclays Capital meantime argue that recent falls in the US unemployment rate are in part down to people dropping out of the labor force, and that this could force the Federal Reserve to tighten monetary policy sooner than previously expected in order to combat inflation risks.
“If the goal became to restore the employment-to-population ratio to where it was prior to the recession, we’d need an unemployment rate of about 3%, and that would clearly lead to monetary policy being too easy for too long,” Dean Maki, Barclays chief US economist, tells newswire Bloomberg.
“We think this is a factor contributing to medium-term inflation risks.”
The Fed revealed back in January that most of its policymakers expect interest rates to remain near zero until at least late 2014.
Monthly US consumer price inflation meantime rose to its highest level in nearly a year last month, data published on Friday show.
“The market no longer believes that ‘late 2014′ is when rates will rise,” said M&G Investments’ Bond Vigilantes blog on Friday.
“The market is now pricing in a Fed rate hike in 2013.”
Here in the UK, the British government plans to take on the pension fund of the Royal Mail, subject to European Commission approval, in preparation for privatizing the state-owned postal service.
The move would guarantee postal workers’ retirement benefits, writing off around £1 billion of the Royal Mail’s debt and taking over an estimated £4.6 billion pension deficit, the Financial Times reports.
“The liabilities,” writes the FT’s Tony Jackson, “will vanish off the government’s balance sheet…that is, no doubt, fiscally imprudent.”
Jackson argues that the move is another example of financial repression by the British government.
“The government,” adds Philip Booth of think tank the Institute of Economic Affairs, “would not allow a private sector company to get away with such shoddy – indeed, underhand – accounting practices.”
On the gold futures and options markets, the difference between bullish and bearish contracts held by traders on the New York Comex – the so-called speculative net long – fell for the second week running in the week ended last Tuesday, dropping 5%, figures published by the Commodity Futures Trading Commission show.
“We expect that [even] more speculative length has been removed after last week’s sell-off,” says Standard Bank’s Ground.
The volume of gold bullion held to back shares in the SPDR Gold Trust (GLD ) – the world’s biggest gold ETF – dipped slightly last week to 1293.2 tonnes. Silver bullion holdings in the world’s largest silver ETF, the iShares Silver Trust (SLV), remained static at 9752.7 tonnes.
In emerging markets meantime, central banks have been buying gold in recent weeks to take advantage of falls in the gold price, the FT reports.
Gold value calculator | Buy gold online at live prices
Editor of Gold News, the analysis and investment research site from world-leading gold ownership service BullionVault, Ben Traynor was formerly editor of the Fleet Street Letter, the UK’s longest-running investment letter. A Cambridge economics graduate, he is a professional writer and editor with a specialist interest in monetary economics.
(c) BullionVault 2011
Please Note: This article is to inform your thinking, not lead it. Only you can decide the best place for your money, and any decision you make will put your money at risk. Information or data included here may have already been overtaken by events – and must be verified elsewhere – should you choose to act on it.
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 decreased their overall US dollar long positions last week while Japanese yen positions fell sharply for a sixth consecutive week and declined to their lowest level in almost a year.
Non-commercial futures traders, including hedge funds and large speculators, trimmed their total US dollar long positions to $19.0 billion on March 13th from a total long position of $19.27 billion on March 6th, 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 speculators increased their sentiment for the euro currency as Euro short positions fell to the lowest since December. Euro net short positions declined to 99,336 contracts against the currency on March 13th from the previous week’s total of 116,473 net short contracts. Contracts are at the best position since December 6th when short positions totaled 95,814 contracts.
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 fell for a second consecutive week, according to the data as of March 13th. British pound positions saw a total of 41,848 net short positions on March 13th following a total of 37,099 net short positions registered on March 6th. British pound sterling positions are at their lowest level since December 6th when positions equaled 43,560 short contracts.
JPY: The Japanese yen speculative contracts continued their sharp downtrend last week to drop for a sixth consecutive week and declined to their lowest level since April 2011. Yen positions fell to a total of 42,380 net short contracts reported on March 13th following a total of 19,358 net short contracts on March 6th. Yen speculative positions are at their lowest level since April 19th 2011 when positions totaled 52,983 short contracts.
CHF: Swiss franc speculator positions rose after contracts were virtually unchanged for the previous three consecutive weeks. Speculator positions for the Swiss currency futures registered a total of 14,798 net short contracts on March 13th following a total of 19,478 net short contracts as of March 6th.
CAD: Canadian dollar positions rose higher for a sixth consecutive week and remain at their highest level since August. Canadian dollar positions rose to a total of 26,721 net long contracts as of March 13th following a total of 26,032 long contracts that were reported for March 6th. CAD positions are at their highest position since August 2nd 2011 when long contracts equaled 41,037.
AUD: The Australian dollar long positions rebounded last week after a decline the previous week. Australian dollar positions increased to a total net amount of 66,756 long contracts on March 13th after totaling 61,720 net long contracts reported as of March 6th. The AUD speculative positions on February 28th were at their highest level since Australian dollar long positions totaled 81,438 on July 26th 2011.
NZD: New Zealand dollar futures speculator positions decreased for a third consecutive week after they had risen for nine straight weeks through February 21st. NZD contracts decreased to a total of 13,223 net long contracts as of March 13th following a total of 16,788 net long contracts on March 6th. NZD contracts on February 21st had passed the previous 12-month high level recorded on August 2nd when net long contracts totaled 24,126.
MXN: Mexican peso speculative contracts improved for a tenth consecutive week and continue to be at the best position since August 2nd. Peso long positions numbered a total of 78,892 net long speculative positions as of March 13th following a total of 66,347 long contracts that were reported for March 6th.
COT Currency Data Summary as of March 13, 2012
Large Speculators Net Positions vs. the US Dollar
EUR -99336
GBP -41848
JPY -42380
CHF -14798
CAD +26721
AUD +66756
NZD +13223
MXN +78892
Other COT Trading Resources:
Trading Forex Using the COT Report
By TraderVox.com
Tradervox (Dublin) – Euro has climbed above the 1.3200 levels to print the fresh daily high of 1.3264. The pair is trading around 1.3245, up about 0.47% for the day. The resistance may be seen at 1.3260 and above at 1.3300 levels. The support may be seen at 1.3200 and below at 1.3160 levels. Euro rose sharpely during the US session.
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Article provided by TraderVox.com
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In trading on Monday, general contractors & builders shares were relative laggards, down on the day by about 1%. Helping drag down the group were shares of M/I Homes (MHO), down about 2.5% and shares of KB Home (KBH) off about 2.3% on the day.
