Fundamental News: July 5, 2013

 

The Bank of England and European Central Bank opted not to surprise the market yesterday, leaving their respective rates unchanged. The BOE maintained its official bank rate at 0.50 percent, while the ECB left its own rate also at 0.50 percent. BOE’s Asset Purchase Facility stayed at GBP375 billion.

 

The United States celebrated its 237th Independence Day, hence the market was unusually thin during the North American and the subsequent Asian session today.

 

In Japan, the Cabinet Office published the Leading Indicators data for May. The index stood at 110.50 percent, moving forward from April’s reading which was revised higher to 107.70 percent. This is the second reading in the 100 percent level, following 15 consecutive months of spending in the 90 percent level.

 

In Switzerland, the Swiss National Bank announced earlier that June’s Foreign Currency Reserves declined two percent compared to May. This amounted to CHF434.90 billion, following May’s CHF441.10 billion. Meanwhile, Swiss Consumer Price Index remained at 0.1 percent for a second month in a row, according to the Federal Statistics Office.

 

In Germany, the Bundesbank reported that Factory Orders surprisingly declined for the second month. Orders placed with manufacturers contracted 1.3 percent in May, following a 2.2 percent decline in April. This indicates uncertainty in economic recovery in Europe’s largest economy.

 

Soon, the market will witness the release of key economic data in the form of Canada’s Employment Change and Unemployment Rate, as well as US Non-Farm Employment Change, Unemployment Rate, and Canada’s Ivey PMI.

 

Commodities News

 

Like most markets, Gold traded quietly yesterday as US celebrated its independence. Gold traded in a very tight $14 range, which was followed by a modest decline today. Price went close to breaching $1,230 and looks like price would either range or ease further. Traders are better off at the sidelines.

 

Oil spent most of its time trading in the upper-$100s yesterday. However, price opted to resume its climb today, reaching a very marginal new high just an hour ago. Bulls should make a forceful upside attack; otherwise a move back to $99-$100 would be in the offing.

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