openPR Logo
Press release

British Pound Crashes on Dovish BOE Inflation Report

The FTSE finished the week down slightly, but the real loser last week was UK PLC. The pound crashed as various factors come to a head. Up until July, the US Dollar was the currency the world loved to hate, last week it was sterling’s turn to be punished. The Bank Of England inflation report was more dovish than expected, opening the doors to possible interest rate cuts before the year is out. This coupled with a housing market that has fallen through the roof and warnings of a UK recession being imminent pushed Sterling down 2.8% against the Dollar and 2.50% against the Yen on the week. It wasn’t all one way traffic though and the pound managed to recover some ground against the Euro in particular, finishing down just -0.67. Just a day after the Pounds collapse, it was the Euro’s turn to swoon on speculation that the European Central Bank would begin cutting interest rates next year to boost the shrinking Eurozone economy. The Euro finished down 2.17% against the Dollar on the week and now down 5.74% on the month.

World equities finished the week mixed. With the notable exception of the high tech Nasdaq, most world indices finished the week in the flat or down slightly. On the whole though, a relatively quiet economic calendar and low summer volume muted activity after last week’s impressive action. The conflict in Georgia barely registered a twitch on oil prices and the week closed with prices falling to $113.77. Also, due to the cessation of hostilities in Georgia and the resurgent Dollar, Gold fell back well below $800 after a tentative recovery last week.

The financial sector was once again under pressure last week and without the FTSE’s other major sector firing on all cylinders (oil), the index is showing weakness where it counts. It has recently been reported that global bank’s losses & writedowns from the credit crunch have exceeded the $500bn marker. To add to the gloom, New York University economist Nouriel Roubini has recently estimated that this figure could double before the crisis is over.

The US housing market is still showing signs of weakness. If anything the problem is accelerating despite numerous calls for a bottom over the last 12 months. Foreclosure activity increased by 55% year on year, with one in every 464 houses in trouble. The nascent UK housing collapse still has some way to go to match the declines of the US market, but it may not be long before the UK market registers equally grim readings.

Next week is relatively quiet with fewer top tier economic announcements. The week starts with ZEW economic sentiment from Germany on Tuesday morning, followed by US building permits and monthly PPI data in the afternoon. Wednesday release of the minutes from the last MPC meeting will be closely followed especially after the impact of last week’s inflation report. Thursday brings UK retail sales figures, with revised GDP numbers coming on Friday morning. The week’s hot trading ticket will be Fed Chairman Bernanke speaking on Friday afternoon.

Last week was quiet by recent standards with no large 300 point rallies on the Dow as we saw the week before. On this note the there was some interesting research from David Rosenberg of Merrill Lynch (credit to Barry Rithholtz for highlighting it).

Rather than being a sign of a market recovery, Rosenberg found that every 300 point rally on the Dow Jones Industrial average has occurred only during bear markets. During the 2000 to 2002 bear market, the Dow had fifteen 300 point gain days. Since the markets peaked around September 2007, the Dow has technically been in a bear market and during this period there have been seven days experiencing a 300 point rally on the Dow. More curious was the fact that during the bull run from 2002 to 2007, there wasn’t a single 300 point rally on the Dow.

According to Bespoke Investments (bespokeinvest.typepad.com) the average return three months after a 300 point move is just 0.06%, hardly grounds for the start of a spectacular rally. To take advantage of this, we can place a ‘No Touch’ trade on the Dow Jones, predicting that it won’t touch 12,500 at any time during the next 90 days. This could return 57% in betonmarkets.com if successful.

Name: Mike Wright
Tel: 448003762737
Email: editor@my.regentmarkets.com
URL: http://www.betonmarkets.com & http://www.betonmarkets.co.uk

Address:
Regent Markets (IOM) Limited
3rd Floor, 1-5 Church Street
Douglas, Isle of Man
IM1 2AG

About Regent Markets Group:

Regent Markets is the world's leading fixed odds financial trading group. Through its main multi-awarding winning websites, BetOnMarkets.com and BetOnMarkets.co.uk, it has established itself as the leading global provider of a unique, powerful way to trade the world's major financial markets. The number, length and variety of trades available to our clients exists nowhere else in the world.

This release was published on openPR.

Permanent link to this press release:

Copy
Please set a link in the press area of your homepage to this press release on openPR. openPR disclaims liability for any content contained in this release.

You can edit or delete your press release British Pound Crashes on Dovish BOE Inflation Report here

News-ID: 51392 • Views: 652

More Releases from Regent Markets (IOM) Limited

Will the Stocks Bear Market Continue to Reign?
There were genuine signs of emerging optimism in stock markets last week. Confidence has been largely absent so far in 2009, with every attempted rally squashed before it really had chance to get going. There is a growing sense that this time round things are different, and this belief will only grow further, if markets can survive the next week or so without dropping too far below last Thursday’s low.
Still trapped in financial mess
Considering the dead weight financial sector, stock markets could have fallen a lot further than they eventually did over the course of last week. However, there's no getting away from the mess that financial shares are in. Just over two years ago today, the RBS share price hit an all time high of £7.24. Last weeks low of just 10p highlights the markets underlying concern that the financial cancer has
Credit Crunch Springs Back into Action
After taking some time off between Christmas and New Year, the credit crunch was well and truly back in action last week. Fears over further banking problems and sovereign debt downgrades for the likes of Ireland and Greece surfaced last month, but until now, these fears have merely been simmering in the background. Last week, the heat was once again turned up, and major fault lines are once again
Markets suffer their worst run for generations
The final week of 2008 passed with many markets recording their worst annual performance for generations. Equities finished above their lows, but still finished down by at least 30%. The S&P 500 closed 2008 down 38%, while the Nikkei closed down over 40%. The ‘lost decade’ rolls on ever more for the Japanese stock market. Perhaps the most remarkable performance came from commodities; at one stage, oil and copper were

All 5 Releases


More Releases for Dow

Chlorpyrifos Market: In-Depth Analysis with Top Key Players | Dow Chemical Compa …
Allied Market Research published a new report, titled, "Global Chlorpyrifos Market - Opportunity Analysis and Industry Forecast, 2020-2027, Porter's Five Forces analysis, and competitive landscape. This study is a helpful source of information for market players, investors, VPs, stakeholders, and new entrants to gain thorough understanding of the industry and determine steps to be taken to gain competitive advantage. The report offers key drivers that propel the growth in the global
Global Moisture Curing Adhesives Market 2019 - 3M, SIKA, THE DOW CHEMICAL, BOSTI …
Rising demand from the construction and wood working industries and superior advantages over conventional adhesives to drive the moisture cure adhesives market. The Scope of the Report: This report focuses on the Moisture Curing Adhesives in global market, especially in North America, Europe and Asia-Pacific, South America, Middle East and Africa. This report categorizes the market based on manufacturers, regions, type and application. The rising demand for lightweight materials such as moisture cure
Global Emulsion Sealants Market 2018 - 3M, Dow Chemical, Dow Corning, H.B. Fulle …
` The statistical surveying information incorporated into the Emulsion Sealants report is the aftereffect of significant essential and optional research exercises. The report fragments the worldwide market for Emulsion Sealants based on makers, item compose, applications, and Region. In this report, each fragment is contemplated completely and measurements are introduced in detail. The report offers an exact outline of the worldwide Emulsion Sealants advertise covering key factors, for example, drivers and
Specialty Adhesives Global Market: By Top Manufacturers - 3M, Dow Corning, BASF, …
Researchmoz added Most up-to-date research on "Specialty Adhesives Global Market: By Top Manufacturers - 3M, Dow Corning, BASF, The Dow Chemical & Henkel" to its huge collection of research reports. In this report, the global Specialty Adhesives market is valued at USD XX million in 2016 and is expected to reach USD XX million by the end of 2022, growing at a CAGR of XX% between 2016 and 2022. Geographically, this report
Global Electronics Adhesive Market 2017 - 3M, Cyberbond, Dow Chemical, Dow Corni …
This report studies Electronics Adhesive in Global market, especially in North America, China, Europe, Southeast Asia, Japan and India, with production, revenue, consumption, import and export in these regions, from 2012 to 2016, and forecast to 2022. This report focuses on top manufacturers in global market, with production, price, revenue and market share for each manufacturer, covering 3M Cyberbond Dow Chemical Dow Corning H.B. Fuller Henkel Hexion Huntsman ITW Performance Polymers Jowat LORD Corp Mactac Mapei DELO Industrial Adhesives Avery Dennison Benson Polymers BUHNEN (Germany) Master Bond Drytac Dymax Pidilite Industries Royal Adhesives
Electronics Adhesive Market 2017 : Cyberbond, Dow Chemical, Dow Corning, H.B. Fu …
Electronics Adhesive Market Research Report A market study based on the " Electronics Adhesive Market " across the globe, recently added to the repository of Market Research, is titled ‘Global Electronics Adhesive Market 2017’. The research report analyses the historical as well as present performance of the worldwide Electronics Adhesive industry, and makes predictions on the future status of Electronics Adhesive market on the basis of this analysis. Request For Sample Copy