US & World Daily Markets Financial Briefing 27-09-2006

Start trading successfully today
Click here  to find out more

Stocks rise; Dow nears all-time high

NEW YORK - Stock prices rose in early trading Wednesday as investors shrugged off a lackluster durable goods report and a modest increase in oil prices. In early trading, the Dow Jones industrial average was up 23.45, or 0.20 percent, at 11,692.84, just over 30 points away from its record high close of 11,722.98.
   
Broader stock indicators also turned positive. The Standard & Poor's 500 index rose 1.73, or 0.13 percent, to 1,338.07, and the Nasdaq composite index advanced 3.85, or 0.17 percent, at 2,265.19.
   
The Commerce Department said orders to U.S. factories for large manufactured goods fell for a second straight month in August, the first time in more than two years there have been consecutive declines. Demand for durable goods dropped 0.5 percent last month to $209.7 billion.
   
Investors were also awaiting another Commerce Department report Wednesday morning on August new home sales.
   
A barrel of light crude was quoted up 38 cents at $61.39 a barrel in pre-opening trading on the New York Mercantile Exchange.
   
Bonds rose, with the yield on the benchmark 10-year Treasury note falling to 4.56 percent from 4.58 percent late Tuesday. The dollar was mixed against other major currencies, while gold prices fell.
   
Good news for several Dow components could help the average, which has flirted with its Jan. 14, 2000 closing high as investors have grown more confident in the strength of the economy. The enthusiasm grew after the Federal Reserve has signaled interest rates are in check for now and as oil prices have receded from highs seen in recent months.
   
McDonald's Corp. rose 71 cents to 39.77 after saying it would boost its dividend 49 percent to $1 from 67 cents.
   
Another Dow component, Merck & Co., had another legal victory Tuesday in its legal battle over the painkiller Vioxx. A federal jury determined after a two-week trial that there wasn't sufficient evidence to link Vioxx to a Kentucky man's heart attack in 2003. Though it was a win for Merck, thousands of cases are still pending over the drug. Merck was up 17 cents at $41.73.
   
The Russell 2000 index of smaller companies was down 1.84, or 0.25 percent, at 727.77.

VantagePoint's market forecasts are nearly 80% accurate. Take a look at actual forecasts, become eligible for a Complimentary VantagePoint Market ($750 value!) and see the difference they will make. Click here to see two recent forecasts now.

Dollar recovers from brief falls after weak US durable goods data

LONDON - The dollar fell briefly after data unexpectedly showed the second consecutive monthly fall in US durable goods orders during August, but recovered soon after as dollar sentiment remains positive.
   
The figures showed new orders for durable goods fell by 0.5 pct in August after falling a downwardly-revised 2.7 pct in July, against expectations for a 0.4 pct rise. This is the first time durable goods have fallen for two consecutive months since April and May 2004.
   
At 1.09 pm GMT, the euro was trading at 0.2692 against the dollar, having reached a high of 1.2719 immediately following the data. Just before the data were released, the euro was trading at 1.2680 usd.
   
Also awaited later this afternoon are the latest US new home sales data. Existing home sales figures released earlier this week suggested that the slowdown in the US housing market may not be as pronounced as earlier feared.
   
Elsewhere, the pound remained broadly weaker following this morning's unexpected downward revision to UK quarterly GDP for the second quarter and a very dovish speech from Monetary Policy Committee member David Blanchflower to contrast with more hawkish comments from Sir John Gieve earlier.
   
The currency pared some of its earlier losses, however, after the latest distributive trades survey from the Confederation of British Industry showed retail sales in the UK rose at their fastest rate in nearly two years during September.
   
The survey showed a balance of +14 pct of retailers reported sales were up during the month, the highest balance since December 2004's +33 pct and ahead of expectations of a modest dip to +10 pct from August's +12 pct.
   
The survey will increase expectations that the Bank of England will raise interest rates again in November.

Get a Completely Free $50,000 FX Demo!
Instant execution with: no slippage, no partial fills and no debits � all Guaranteed. Click the bid or offer with instant fills. Zero commissions � Period! All at XPRESSTRADE.com

The European Markets at 11.30 GMT

London - Leading shares continued in positive mood remaining up at midday, bolstered by rises across the mining sector, while hopes of a renewed bid approach for EMI from Warner Music was adding to the pervading optimism. The market was also assisted by continued strength across the Atlantic, expected to open higher again today.
   
By lunchtime, the FTSE 100 index was up 53.6 points at 5,927.2, with only UK small caps in the red. Volume was moderate with 1.23 bln shares trading in 144,016 deals.

Frankfurt - German shares were higher midday as Dow Futures pointed to a higher start on Wall Street, and Continental and RWE raced to the front of the pack, but losses by heavyweights E ON and Bayer capped gains. At 1.35pm, the DAX was 28.18 points or 0.47 pct higher at 5,988.81.

Paris - Share prices were up in heavy midday trading, supported by overnight gains on Wall Street amid easing concerns about the US economic outlook, while a handful of blue chips surged on encouraging corporate news.
   
At 12.39 pm, the CAC-40 index was up 15.92 points or 0.3 pct at 5,235.51, on volume of 1.8 bln euro. On the Matif, October CAC-40 futures were trading 19 points higher at 5,247, while the euro stood at 1.2700 usd compared to 1.2687 late yesterday.

Amsterdam - Shares were up at midday, buoyed by US futures pointing to a higher opening on Wall Street, while Oce slumped after a profit warning. At 12.07 pm, the AEX was 1.30 points or 0.27 pct higher at 481.82, after trading in a range of 481.41-482.97.

Madrid - Share prices were higher midday in brisk trade, as energy sector stocks continue to soar on the back of M&A fever, and with Acciona and Endesa in the limelight after E ON said it intends to sweeten its bid for the utility. At 12.40 pm, the IBEX-35 index gained 229.2 points to 12,846.5, after trading in a range of 12,616-12,873, on solid turnover of 4.83 bln eur.

Milan - Shares were slightly higher at midday, with Bulgari boosted by renewed takeover speculation. At 12.33 pm, the Mibtel index was up 0.22 pct at 29,223 points and the S&P/Mib added 0.16 pct to 38,276.

Stockholm - Shares were higher in midday trade, but off their opening highs amid flat US futures, with mining stocks and Hennes & Mauritz leading the market. At 12.15 pm, the OMX Stockholm index was up 0.98 pct at 333.01, and the OMX Stockholm 30 up 1.05 pct at 1,036.01.

Helsinki - Shares were higher in midday trade, led by Neste Oil on a promising biodiesel investment plan and with Nokia seen shrugging off its ADR price on Wall Street which was little changed last night.
   
At 12.07 pm, the OMX Helsinki 25 was 1.32 pct higher at 2,566.17 points and the OMX Helsinki was up 1.09 pct to 8,761.90 points on 296 mln eur turnover.

Trade with RCG fxtrader�, the platform offering instant access to 12 major FX trading pairs with low spreads (2 pips EURUSD, USDJPY) and global news from 3 major sources.  Trade with a registered and regulated company in business for 80 years. Smart money trades here � Get your FREE Trial Today!

Asian shares close sharply higher after Wall St hits a year high

HONG KONG - Shares across the Asia-Pacific region closed sharply higher after Wall Street ended at its highest level this year on positive US economic news.
   
Tokyo shares finished the day at their highs, with sentiment buoyed by the release overnight of strong US consumer confidence data which pushed the Dow Jones Industrial Average to its second-highest closing level ever.
   
The Nikkei 225 Stock Average closed up 390.42 points or 2.51 pct at 15,947.87, the day's high. The TOPIX index of all first-section issues was up 41.63 points or 2.69 pct at 1,591.04, also the high for the day.
   
Nozomi Securities market analyst Akihiro Shiroeda said worries that the US economy may be cooling faster than initially thought were assuaged by the strong US consumer confidence report and the sharp rebound on Wall Street.
    
Dealers said the market also welcomed Prime Minister Shinzo Abe's pledge yesterday to give emphasis to economic growth.
   
Australian shares finished higher with investor sentiment buoyed by the rally in US stocks while rising metal prices boosted mining stocks.
   
They said investor interest remains supported by the ongoing merger activity and takeover speculation within Australian companies. The S&P/ASX 200 surged 103.6 points or 2.08 pct to close at 5,093.2, below the day's high of 5,095.5 and above a low of 4,989.8.
   
Hong Kong shares were stronger in afternoon trade, following the gains in Wall Street and Tokyo.
   
They reported a technical rebound in select blue chips following yesterday's sharp losses and said some end-quarter window-dressing activity was also supporting the index. At 3.24 pm the Hang Seng Index was up 192.98 points or 1.11 pct at 17,501.06
   
In mainland China, A-shares in Shanghai and Shenzhen closed higher on bargain-hunting with lenders and pharmaceutical stocks in particular snapped up. The Shanghai A-share Index rose 13.44 points or 0.75 pct to 1,812.31 and the Shenzhen A-share Index was up 3.60 points or 0.81 pct at 447.2.
   
Seoul shares ended sharply higher in a broad-based rally with sentiment buoyed by Wall Street and a retreat in oil prices.
   
The market was firm throughout the session to close near its high for the day as foreign investors' aggressive buying in futures triggered heavy program buying, they noted.
   
The KOSPI index closed up 16.06 points or 1.19 pct at 1,360.03, after moving between 1,351.83 and 1,361.12.

Asian Bourse Round-Up

For a full list of closing figures, click here

Inflation picked up in September in Europe as both areas show fragile economic growth. Just as in the U.S., rising energy prices are to blame. Read free, daily market reports available only at CMS Forex and open your free demo trading account today. Click here

Gold gains on improved physical buying, gains in oil

LONDON - Gold prices were higher as the yellow metal benefited from improved physical buying and gains in oil, and continued to discard pressure from a strengthening US dollar.
   
At 12.39 pm, spot gold, which earlier hit a high of 596.80 usd, was quoted at 594.70 usd, up from 591.15 usd at the time of the COMEX market close in New York yesterday. Other precious metals were also up.
   
Spot silver was up at 11.60 usd against 11.22 usd, platinum rose to 1,141.50 usd against 1,126.00 usd, while palladium climbed to 321.50 usd against 314.00 usd.
   
Dresdner Kleinwort analyst Sara-Frederike Weisser said gold is "resisting negative fundamentals".
     
Oil prices resumed their downtrend yesterday while the dollar firmed as a rebound in a closely watched consumer confidence survey suggested US economic growth remains on track.
   
It has continued higher against most currencies today while oil has recovered slightly as traders weighed calls from the OPEC head for the cartel to take action to prevent further price declines.

Gold has lost about 20 pct of its value since touching 730 usd in May -- the highest level in a quarter of a century -- on concerns about geopolitical tensions and inflation.

Base metals rise on tight stocks, increased speculative buying

LONDON - Base metals were higher across the board, extending yesterday's gains, as tight stocks and increased speculative buying overshadowed fears over the impact of slowing US economic growth on demand.
   
At 2.22 pm, LME copper for 3-month delivery was up at 7,705.00 usd against against 7,650.00 usd at the close yesterday, zinc climbed to 3,440.00 usd against 3,408.00 usd, while aluminium rose to 2,544.50 usd against 2,534.00 usd.
   
Lead was up at 1,390.00 usd against 1,378.00 usd, tin increased to 9,075.00 usd against 9,025.00 usd, while nickel reversed yesterday's falls to climb to 28,375.00 usd from 27,650.00 usd.
   
Analysts said the launch today of 29 exchange traded funds (ETFs) on the London Stock Exchange, including ones in copper, zinc, nickel and aluminium, was benefiting the metals.
   
Standard Bank analyst Michael Skinner said the launch of the ETFs adds further weight to the "passive wall of fund money that has previously lifted the complex".
   
Also supporting the metals are declining inventories. The LME said today zinc inventories in its warehouses fell by 1,625 tonnes, lead stocks declined by 1,375 tonnes, while nickel stocks lost 552 tonnes.

Open a Pro account with min deposit $2000 and receive a promotional 1 pip spread on the EUR/USD and discount of 2 pips for all other instruments for 30 days. Click Here

To redeem your promotion, e-mail a request containing the promotion code: 9yupip1 to support@fxyard.com (valid until 10/06/2006)