31 October 2012| UWCFX Daily Market Video Reviews


Asian markets are recovering



Today Asian stocks markets except for China are gaining in price. Better than the others looks Japanese Nikkei which has lost yesterday before closing of a trading session about 1%. The bank of Japan expanded yesterday the program of repayment of bonds on 11 trillion yens (to 91 trillion) that practically coincided with expectations, thus was declared that fight against a deflation is a priority task. Accordingly to a regulator estimates, by 2014 inflation in the country should reach level of 0,8%, but the target level is 1%. On this background investors safely can expect further continuous monetary easing policies in Japan. Meanwhile the Japanese yen continues some strengthening after last wave of decrease, and today currency pair USD/JPY already bargains at level 79,6 against 80 on Friday.
Today the trading at the exchanges of USA should renew. The main blow of hurricane “Sandy” is over; the building of the New York stock exchange did not suffer. Investors with big tension expected information on renewal of the auctions – at the end of the week there is coming a lot of an important macroeconomic statistics. In the centre of attention there will be data on a labor market, the last one before the elections in the United States.
In absence of the trading in the USA, the prices for oil following the results of last session showed multidirectional dynamics. The spread in December contracts between the Brent and WTI brands makes at present 23,4 dollars. Volumes naturally appeared essentially below averages. According to Reuters, owing to elements on east coast of the USA, 2/3 of all oil refining enterprises appeared closed. Besides, the stop touched also the largest oil pipeline. Nevertheless, already in the nearest future the situation should be stabilized. Today in the morning we can see Brent traded on 109.20 and Light on a level of 85.99.
One of the world’s largest investment companies BlackRock on Tuesday issued the review concerning the market of metals in which expressed opinion on an undervaluation of this type of raw materials. In their opinion, demand from China still remains high, despite decrease in growth rates of economy of Heavenly Empire, and the economic situation in Europe and the USA essentially improved. In this regard, in their opinion, it is possible to expect growth of cost of such goods, as copper, iron ore and others.
We could already observe the result of this statement during Asian trading session; there metal companies were measurably growing this morning.
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USA markets won’t work the second day in a row because of the hurricane “Sandy”



Boards of USA have cancelled it work in connection with hurricane for the second day in a row for the first time in a century. So, on Tuesday, October 30, in the USA trading will not be held not only in shares and options, but also bonds.
Also it has been reported that on Tuesday will be closed for citizens’ visits buildings of the federal government in Washington, and the staff of not emergency services will have holiday. Thus the personnel of the companies in the Wall Street will be presented at the New York offices in limited structure, the big part will spend the working day far off.
It is necessary to note that the Ministry of Labor of the USA declared the intentions on report publication for October on Wednesday, as it is planned according to the schedule, despite the problems connected with hurricane.
Hurricane can also influence oil prices. Earlier already it was noted that on its way there can be some oil refineries in the general capacity of 1,2 million barrels per day, or 7% of oil refining capacities of the USA. In this regard production on the majority of the enterprises is already closed. Also we will note that because oil refineries reduce the capacities, oil stocks this week should grow that indirectly conducts to decrease in the oil prices in North America and also to growth of spread of Brent-WTI.
Today, this morning oil is decreasing and traded on a level of 109.05 dollars per barrel for a BRENT and 85.33 dollars for LIGHT.
Gold and silver are moving in a positive direction and are traded on levels of 1711.43 and 31.88 accordingly. Euro is a bit stronger then dollar and is traded on 1.2921.
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Asian shares edge up on US growth



Asian shares edge higher this morning in signs of stable growth in the United States. The MSCI index of Asia-Pacific shares outside Japan added 0,2 percent after posting its biggest drop in two months last week. Australia and the South Korean Kospi are also up. The Hong Kong and Shanghai indexes ended marginally down. The US markets are closed today due to the storm forecast. New York is expected to be hard hit by Hurricane Sandy and Mayor Bloomberg has ordered evacuation of parts of lower Manhattan.
The US Gross Domestic Product, GDP, rose a mediocre 0,2 in the third quarter to expected 2,0 % for 2012. Housing gave the economy a boost, but business investment is lagging. The growth data point to an economy with little momentum, and leave considerable doubt about its resilience to the so called “fiscal cliff” of tax rises and spending cuts due to take place at the end of the year. With little sign that the growth is poised to accelerate, the US Federal Reserve will have every reason to continue its third round of quantitative easing known as Q3.
Non-residential investment continues to decelerate. There seems to be two reasons for the reversal in capital spending: a weakening in global growth and worries about the fiscal cliff. It is hard to judge which effect is greater. The slowdown in China and other emerging markets which have soaked up US export in recent years probably accounts for a good part of the fall in investment. Investors are also reacting strongly to doubt s about the fiscal environments. Slow steady growth in consumption seems to be the main force supporting growth in the third quarter.
The USD is stronger against the Euro in early trading in Asia at 1.2932. It has though recovered from Friday’s two-week low at 1.2882. The Yen is gaining. USD/JPY trades at 79,72. Big and violent street demonstrations against austerity in Italia, Spain and Greece underline the social and economic explosives caused by the debt crisis in the Euro zone. The dollar index DXY measured against a basket of six major currencies hit a near seven-week high on Friday and is at the same level today. The grim weather forecasts and Hurricane Sandy has stabilized oil prices. Brent crude is trading above 109. Gold and silver are trading slightly higher; 1715 and 32.15.
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Apple iPad sales disappoints



Apple, one of the most valuable public companies in the United States, posted quarterly earnings that fell short of expectations after the close of the US markets yesterday. Earnings a share came in lower than expected and Apple fell 1,4 percent in after hour trading. Equity futures fell on the news Dow Jones and Nasdaq ended up in another uninspiring session on Wall Street. Investors continue to worry about the US economy and a string of weaker than expected company results. 70 % of the companies hitherto reporting have reported lower results than expected.
The negative trend continued in Asia this morning where the major indexes fell. Global concerns on the economic outlook are in the back of investors mind. This together with uncertainties on forthcoming leadership changes in the two biggest economies in the world, US and China, affect the market sentiments negatively. Asian exporters struggle against shrinking global demand for their products. Samsung Electronics, however, is an exception. Samsung reported third quarterly profits for a fourth straight quarter. Profits reached USD 7,4 Billion. Bank of China also reported good results with its biggest quarterly profit in a year. Procter and Gamble was yesterday’s positive exception on the US stock exchanges.
The dollar index and the Japanese yen are down. Bank of Japan has announced aggressive monetary easing which drove the Yen down to 80,05 against the USD. The Euro is also falling. Euro/USD is at 1.2937 after inching towards 1.30 during yesterday’s trade. There are no other big changes in the currency picture.
Oil prices recovered yesterday, but oil is again on defensive in early Asian trade after steep falls over the last ten days. Brent crude is at 107,63. Gold and silver prices, which also recovered yesterday, are again under downward pressure. After staring Asian trade on 1715, gold has fallen ten dollars to 1705. Silver has dipped below USD 32 an ounce. It is expected continued volatility in currency and commodity markets during the last trading day of this week. Stock futures are pointing down.
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Asian shares edge higher


Asian shares edged higher in early Asian trading as signs of recovery in China and the United States eased fears of deteriorating global growth. Market sentiment remained, however, vulnerable when weak corporate earnings continued to undermine investors confidence. The MSCI index for the Asia-Pacific shares were up 0,3 percent. The South Korean Kospi and Australia were also up after a new week session in New York. Both Dow Jones and Nasdaq fell.

Oil prices fell for its seventh consecutive session on Wednesday after US oil storages were reported higher than expected.  Brent crude has recovered in morning trade at 108,25. NYMEX, New York crude, is at its lowest level since July trading at USD 85,73 a barrel. Copper, a reliable barometer for commodities added 0,9 % to 788,685 a metric ton. Gold which has a strong technical support level on 1700, rose to 1709 after trading close to 17600 yesterday. Silver seems to stabilize on bottom levels in the range between 31,50 and 32.

The USD dollar was stronger against an index of six major currencies. The Japanese yen is at 79,95 against the USD.  The stock markets in Japan have stabilized over the last days after the steep fall in previous weeks. The yen is regarded by many investors as a “safe haven” and tend to increase on uncertainties in the market. The Euro has gained ground both against the yen and the USD, trading close to the 1,30 level against the dollar.  The President of the European Central Bank, Mario Draghi, met German parliamentarians yesterday in an effort to convince law makers on the soundness of ECB’s monetary easing.

New numbers from the US housing sector gave further evidence that the sector is picking up. New single family home sales surged in September to the highest levels seen in two and a half years. Weak earnings outlooks and US multinationals missing targets, made investors nervous about a slowing economy.  Apple which is the biggest capitalized company in the world is going to present quarterly results today.

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