U.K. Nationwide HPI falls unexpectedly ..

The U.K.’s Nationwide house price index fell unexpectedly last month, data showed on Friday.

In a report, , Nationwide Building Society said that said its index of U.K. house prices fell to -0.2%, from 0.4% in the preceding month.

Analysts had expected the Nationwide HPI to rise 0.3% last month

...

Gold futures shoot up amid bargain buying ..

Gold shot upwards Friday in a rally fueled by demand from bottom-fishing investors who viewed the precious metal as somewhat oversold.

A weaker dollar helped also, as the two assets often trade inversely from one another.

On the Comex division of the New York Mercantile Exchange, gold futures for February delivery traded at USD1568.75 a troy ounce, up 1.81%

The yellow metal earlier hit a high of USD1582.65 and a low of 1546.25.

Gold futures were likely test support at USD1523.95, Thursday’s low, and resistance at USD1594.25, Wednesday’s high.

The dollar has resumed its traditional role as a safe haven from market volatility during the latter half of 2011.

Loose monetary policies and economic uncertainty weakened the greenback before, which made gold a safe haven during the past year, especially amid concerns that inflationary pressures could rise.

Lately, however, investors have run back to the dollar on fears that the European crisis may be getting worse.

"We need to see the hot money from speculators, we need to see real money from the money managers coming back to this market, they have been absent throughout December," said Saxo Bank senior manager Ole Hansen, according to Reuters.

The weaker dollar was the main reason for gold’s gains on Friday.

The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, slipped 0.34% to hit 80.53.

“That is really where it's coming from," Hansen said.

Elsewhere on the Comex, silver for March delivery rebounded 2.26% to trade at USD27.932 a troy ounce, while copper for March delivery rose 1.80% to trade at USD3.431 a pound.

U.S. stocks fall in light holiday trading; Dow down 0.59% ..

U.S. stocks finished lower Friday and pretty much where they started 2011, as investors blew off the year and stayed largely on the sidelines, making plans for 2012.

The Dow Jones Industrial Average closed down 0.59%, while the S&P 500 index was off 0.43% and the Nasdaq Composite index lost 0.32% on Friday.

In Europe, yields on Italian debt continue sky high at over 7%, fueling fears the European debt crisis is far from over.

In 2012, Italy will go to the bond market to raise EUR450 billion, according to Reuters, which investors view as quite a large sum for a country already battling debt burdens.

Also out of Europe, Spain reported that its deficit will hit 8% of total economic output, up from analyst forecasts for 6%.

Furthermore, fears that China might not avoid a hard landing as its economy eases up from a once red-hot pace have investors bracing for more uncertainty and volatility in 2012.

Leading U.S. losers included IBM, which was down 1.24%, Intel, down 1.22% and Boeing, down 1.03%

Leading gainers included Bank of America, up 1.83%, Hewlett-Packard, up 0.55%, and AT&T, up 0.23%.

European shares rose as well.

France's CAC 40 rose 1.03%, Germany's DAX rose 0.85%, while Britain's FTSE 100 rose 0.10%.

Trading was relatively quiet ahead of the New Year's Day holidays.

On Monday, markets will be closed as no market-moving data will hit the wire until Wednesday, when France releases consumer spending figures.

Asia stocks retreat with Italy in focus; Nikkei slumps 0.3% ..

Asian stock markets were broadly lower in thin year-end trade on Thursday, as investors were reluctant to open new positions before the new year amid lingering concerns over the euro zone’s debt crisis.

During late Asian trade, Hong Kong's Hang Seng Index fell 0.7%, Australia’s S&P/ASX200 shed 0.4%, while Japan’s Nikkei 225 Index dipped 0.2%.

With most investors already away on year-end leave, trading volumes were thin, resulting in tight liquidity conditions and quiet trade.

Renewed concerns over the euro zone’s debt crisis weighed on appetite for riskier assets after Italy sold EUR9 billion of six-month bills on Wednesday, at an average yield of 3.25%, down from a record-high 6.50% in a previous auction in November.

However, the sale failed to reassure markets after data showed Wednesday that the use of the European Central Bank's overnight deposit facility reached a new, all-time high of EUR452.03 billion on Tuesday, revealing that European lenders are still unwilling to lend to each other.

The news prompted investors to shun riskier assets, such as stocks and commodities and flock to traditional safe haven assets.

The euro’s drop to a 10-year low against the yen weighed on exporters. A stronger yen reduces the value of overseas income at Japanese companies when repatriated dampening the outlook for export earnings.

Electronics manufacturer Sharp fell 3.2%, Honda Motors shed 0.8%, while chip-maker Elpida Memory tumbled 5.15% after the Asahi Shimbun reported the company may seek to delay repayment of government loans.

Elsewhere, in Hong Kong, shares in the financial sector led losses, with Hong Kong-listed shares of Europe’s largest lender HSBC holdings dropping 1.35%, while China’s biggest bank Industrial and Commercial Bank of China slumped 1.5%.

Commodity-linked shares contributed to losses, tracking raw material prices lower. Gold producer Zijin Mining Group saw shares fall 2.4%, while oil giant CNOOC retreated 1%.

Looking ahead, the outlook for European stock markets was upbeat ahead of a sale of EUR8.5 billion of long-term Italian debt maturing between 2014 and 2022.

The EURO STOXX 50 futures pointed to a gain of 0.6%, France’s CAC 40 futures added 0.55%, Germany's DAX futures pointed to a rise of 0.5%, while London’s FTSE 100 futures edged up 0.2%.

Later in the day, the U.S. was to release a weekly government report on initial jobless claims, as well as industry data on pending home sales and business conditions in the Chicago area.

Dollar falls on short-lived appetite for risk ..

The dollar finished lower to mixed against major currencies on Friday after global markets took tame data out of the U.S. and a lack of bad news out of Europe as a sign to sell greenbacks and buy other assets deemed a little riskier but more rewarding.

However, reports that Fitch Ratings revised the outlook for AAA-rated France and also warned that six other European countries were at risk for downgrades dampened optimism.

Meanwhile inflation data out of Washington came in flat, as the consumer price index was unchanged in November and under expectations for a 0.1% gain.

Weak inflation data coupled with sentiment that the Federal Reserve will keep monetary policies unchanged for a while gave investors reason to sell and buy other currencies, especially the euro, which has taken a beating in recent days.

On Friday, EUR/USD finished up 0.13% and closed at 1.3032, as many investors viewed the European currency as underpriced.

The greenback also weakened against the pound, with Cable rising 0.18% to hit 1.5543.

Meanwhile, the greenback was down 0.06% against the yen, with USD/JPY at 77.81, and down against the Swiss franc, with USD/CHF falling 0.41% at 0.9360.

The greenback was mixed against its counterparts in Canada, Australia and New Zealand, with USD/CAD up 0.31% at 1.0384, AUD/USD up 0.42% to 0.9982 and NZD/USD up 1.10% to hit 0.7617.

The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, fell 0.33% to 80.69.

Data will be light ahead of the holidays next week.

On Sunday in New Zealand, the Westpac Consumer Sentiment Index will publish, which measures the change in the level of consumer confidence in economic activity.

Also on Sunday, the U.K. will release its Rightmove House Price Index, which measures changes in asking prices of homes up for sale.

On Monday in the U.K., the Nationwide Consumer Confidence numbers will tentatively publish, with forecasts predicting a reading of 34 points for November, down from 36 points in October.

Also on Monday, the Reserve Bank of Australia will release its Monetary Policy Meeting Minutes.

Weekly outlook: December 19 - 23 ..

Last week saw the euro post its biggest weekly drop in more than three months against the U.S. dollar, tumbling to an 11-month low amid concerns over mass credit ratings cuts and an economic slowdown across the single currency bloc.

The euro’s losses came after a European Union agreement reached earlier in the month disappointed expectations for a comprehensive solution to resolve the debt crisis in the region.

The single currency fell to an 11-month low against the greenback mid-week before edging higher, but the threat of ratings downgrades meant investors remained wary.

The euro found support after an action of Spanish government debt on Thursday met with solid investor demand.

The country sold EUR2.5 billion of five-year bonds at an average yield of 4.02%, down sharply from 5.27% at a similar auction last month. Spain also auctioned EUR1.4 billion of 10-year bonds at a yield of 5.54%, compared to 6.97% last month.

Spain's performance contrasted sharply with Italy on Wednesday which saw yields on five year bonds surge to euro-era highs.

Market sentiment was also helped by Thursday’s stronger-than-expected U.S. employment and manufacturing data.

Earlier in the week, the Federal Reserve warned that market turbulence stemming from the crisis in the euro zone posed a threat to the U.S. economy but stopped short of indicating fresh stimulus measures to shore up growth.

On Friday, Fitch Ratings announced that it lowered France’s rating outlook and put six other euro zone members on review for a downgrade, saying that a “comprehensive solution” to the euro-zone crisis is “technically and politically beyond reach.”

Earlier this month, Standard and Poor’s placed the credit ratings of 15 euro zone members, including France, Germany, Italy and Spain on negative watch, pending possible downgrades.

Elsewhere, the euro fell sharply against the Swiss franc on Thursday, after the Swiss National Bank kept its minimum exchange rate target of 1.20 per euro unchanged and reiterated its pledge to defend the level with the "utmost determination."

The SNB warned of a highly uncertain global economic outlook, saying that a further escalation of the debt crisis in the euro zone could not be ruled out. The central bank also kept its key interest rate close to zero.

In the week ahead investors will be keeping a close watch on Tuesday’s report on German business climate, to assess the impact of the debt crisis on the region’s largest economy. Meanwhile, the U.S. is to release key reports on the housing sector, durable goods and jobless claims.

Ahead of the coming week, Forex Pros has compiled a list of these and other significant events likely to affect the markets.

Monday, December 19

New Zealand is to release data on business confidence as well as a report on consumer sentiment, an important indicator of economic health.

The U.K. is to publish industry data on house price inflation, a leading indicator of the housing industry’s health. Meanwhile, the Bank of England is to release its quarterly bulletin.

The euro zone is to produce official data on the current account, while later in the day, ECB President Mario Draghi is to speak; his comments will be closely watched for any hints on the future direction of monetary policy.

Also Monday, Canada is to produce official data on wholesale sales, a leading indicator of consumer spending.

Tuesday, December 20

The Reserve Bank of Australia is to publish the minutes of its most recent policy setting meeting, which contain insights on current economic conditions from the bank’s perspective. The country is also to publish an index of leading economic indicators.

Elsewhere, New Zealand is to release government data on the current account and visitor arrivals.

The U.K. is to produce two separate reports on consumer confidence, a leading indicator of consumer spending, as well as industry data on retail sales.

Switzerland is to publish official data on the trade balance, the difference in value between imported and exported goods over the month. In the euro zone, Germany is to release official data on producer price inflation, consumer climate and business climate.

Canada is to release government data on consumer price inflation, which accounts for the majority of overall inflation.

Later Tuesday, the U.S. is to publish official data on building permits, an excellent gauge of future construction activity, as well as a report on housing starts.

Wednesday, December 21

Australia is to publish an index of leading indicators, which is designed to forecast the direction of the economy. Later in the day, New Zealand is to publish government data on third quarter gross domestic product, the broadest measure of economic growth and the foremost indicator of the economy's health.

Elsewhere, the Bank of Japan is to announce its benchmark interest rate; the announcement is to be followed by a closely watched press conference to discuss monetary policy. Japan is also to publish official data on the trade balance.

In the U.K., the BoE is to release the minutes of its most recent policy setting meeting, which contain insights on current economic conditions from the bank’s perspective. The bank is also to produce data on public sector net borrowing.

Canada is to release government data on retail sales, the foremost indicator of consumer spending, which accounts for the majority of overall economic activity.

Also Wednesday, the U.S. is to produce industry data on existing home sales, a leading indicator of economic health, as well as data on crude oil stockpiles and the treasury currency report.

Thursday, December 22

In Japan, BoJ Governor Masaaki Shirakawa is to speak; his comments will be closely watched for any hints on the future direction of monetary policy. Meanwhile, the BoJ is to publish its monthly report.

The U.K. is to publish official data on the current account, as well as revised data on third quarter GDP growth.

The U.S. is to publish its weekly report on initial jobless claims, a leading indicator of economic health. The country is also to produce revised data on third quarter GDP, while the University of Michigan is to release revised data on consumer sentiment and inflation expectations.

Friday, December 23

Markets in Japan are remaining closed in observance of the Emperor's Birthday.

The U.K. is to release industry data on mortgage approvals, a leading indicator of housing market demand.

Later in the day, Canada is to produce its monthly report on GDP growth. The U.S. is to round up the week with official data on durable goods orders, a leading indicator of production as well as data on personal spending income, personal spending and new home sales.

USD/JPY up in European trade ..

The U.S. Dollar was higher against the Japanese Yen on Friday.

USD/JPY was trading at 77.88, up 0.04% at time of writing.

The pair was likely to find support at 77.59, Monday’s low, and resistance at 78.16, Wednesday’s high.

Meanwhile, the U.S. Dollar was down against the Euro and the British Pound, with EUR/USD gaining 0.16% to hit 1.3037 and GBP/USD rising 0.10% to hit 1.5530.

German manufacturing PMI rises to 2-month high ..

Manufacturing activity in Germany rose unexpectedly in December, rebounding from the previous month’s 28-month low, preliminary data showed on Thursday.

In a report, market research group Markit said that its preliminary German manufacturing purchasing managers’ index rose by 0.2 points to a seasonally adjusted 48.1 in December, up from 47.9 in November.

Analysts had expected the index to decline by 0.3 points to 47.6 in December.

A reading above 50.0 on the index indicates industry expansion, below indicates contraction.

Meanwhile, the report showed that service sector activity in Germany rose to a five-month high in December.

The preliminary services purchasing managers’ index rose by 2.4 points to a seasonally adjusted 52.7 from 50.3 in November. Analysts had expected the index to ease down 0.2 points to 50.1.

Commenting on the report, Tim Moore, Senior Economist at Markit said, “December’s flash PMI reading for Germany is a step in the right direction, but not enough to rescue what has been a subdued final quarter of 2011.”

“Higher services activity has meanwhile been a pillar of support to overall German output in recent months,” he added.

Following the release of the data, the euro remained higher against the U.S. dollar, with EUR/USD rising 0.31% to trade at 1.3024.

Meanwhile, European stock markets extended gains. The EURO STOXX 50 climbed 0.8%, France’s CAC 40 rose 0.85%, the FTSE 100 advanced 0.8%, while Germany's DAX jumped 0.9%.

EUR/GBP close to 10-month after Spanish debt sale ..

The euro was trading close to a 10-month low against the pound on Thursday, as fears over the debt crisis in the euro zone continued to dominate sentiment after last week’s European Union summit offered no hope of an immediate resolution.

EUR/GBP hit 0.8376 during European morning trade, the daily low; the pair subsequently consolidated at 0.8385, slipping 0.10%.

The pair was likely to find support at 0.8372, Wednesday’s low and a 10-month low and resistance at 0.8424, the session high.

The euro remained under pressure despite a stronger-than-expected investor demand at a Spanish bond auction earlier.

Spain’s Treasury sold EUR6 billion of medium-and-long-term bonds earlier in the day, far surpassing a target of EUR3.5 billion.

The country sold EUR2.5 billion of five-year bonds at an average yield of 4.02%, down sharply from 5.27% at a similar auction last month. Spain also auction EUR1.4 billion in ten-year bonds at a yield of 5.54%, compared to 6.97% at a November bond sale.

Earlier in the day, the European Central Bank’s monthly report said the debt crisis in the region still posed a substantial threat to the outlook for growth.

The report came after data showing that manufacturing activity in the euro zone rose unexpectedly in December, but remained in contraction territory for the fourth consecutive month.

A separate report showed that consumer price inflation in the euro zone remained unchanged at an annualized rate of 3% in December, in line with expectations.

Elsewhere, the euro pushed higher against the U.S. dollar, with EUR/USD adding 0.27% to hit 1.3018.

Also Thursday, official data showed that U.K. retail sales fell more-than-expected in November, as consumers reined in spending.

Gold plunges to two-month low as stronger USD weighs ..

Gold futures plunged through key support levels on Wednesday, trading at the lowest level since late October as a broadly stronger U.S. dollar and fears that euro zone’s sovereign debt crisis was worsening prompted investors to sell profitable gold holdings to raise liquidity.

On the Comex division of the New York Mercantile Exchange, gold futures for February delivery traded at USD1,613.15 a troy ounce during early U.S. morning trade, plunging 3%.    

It earlier fell by as much as 3.25% to trade at USD1,609.55 a troy ounce, the lowest price since October 21.

Gold futures were likely to find short-term support at USD1,604.85 a troy ounce, the low of October 20 and resistance at USD1,681.55, Tuesday’s high.

Gold’s losses came as the U.S. dollar rallied to an 11-month high against the euro, while the dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.35% to trade at 81.25, the highest since January 11.

A stronger dollar saps demand for commodities as an alternative investment and makes metals priced in the currency more expensive in terms of other monies.

Concerns over the fiscal health of Italy intensified after the country’s Treasury auctioned the full targeted amount of EUR3 billion of five-year government bonds at an average yield of 6.47%, up from 6.29% at a similar auction last month.

Following the auction, the yield on Italian 10-year bonds rose above the critical 7% threshold, re-approaching the euro-era highs hit last month.

Market sentiment has been hard hit in recent days by the view that last week's European Union summit did not result in concrete plans to tackle the debt crisis in the region.

Gold futures have fallen sharply in the past three sessions, losing nearly 7%, as investors sold the precious metal to raise cash and cover losses in other asset classes. Despite the slump, gold prices are still 15% higher on the year, on track for its 11th consecutive annual gain.

European lender HSBC Holdings said earlier that, “Some macro hedge funds are liquidating gold holdings and taking profits in a difficult year. As trading volume typically drops toward year-end, we expect increasingly volatile price swings."

Elsewhere on the Comex, silver for March delivery plummeted 6.9% to trade at a ten-week low of USD29.08 a troy ounce, while copper for March delivery tumbled 3.4% to trade at USD3.325 a pound.

.. Natural gas trades at 27-month low on weather outlook

Natural gas futures fell sharply on Wednesday, trading at the lowest level since September 2009 as ongoing concerns over warm winter temperatures and worries about growing U.S. inventory levels continued to dampen sentiment on the heating fuel.

On the New York Mercantile Exchange, natural gas futures for January delivery traded at USD3.193 per million British thermal units during U.S. morning trade, plunging 2.6%.

It earlier fell by as much as 2.75% to trade at USD3.182 per million British thermal units, the lowest since September 11, 2009.

The January natural gas contract has lost nearly 11% since the beginning of December, as forecasts for warmer-than-normal winter weather was likely to limit heating demand.

The Commodity Weather Group said earlier that temperatures across the U.S. East Coast states will be at least five degrees above-average from December 19 to December 23.

“Widespread warming is expected to dominate the 1-10 day range yet again with only some minor fluctuations possible,” the weather group said in a report.

According to the U.S. National Weather Service, the daily average temperature in New York for December was 4.3 degrees above normal through December 13.

Natural gas prices have closely tracked weather forecasts in recent weeks. Above-normal winter temperatures reduce the need for gas-fired electricity to heat homes, dampening demand for natural gas.

Meanwhile, markets were looking forward to the U.S. Energy Information Administration’s weekly report on U.S. natural gas stockpiles for the week ended December 9 on Thursday.

Early injection estimates range from a decline of 60 billion cubic feet to 92 billion cubic feet. The five-year average stockpile change for the week is a drop of 142 billion cubic feet, according to U.S. Energy Department data.

Gas futures typically climb during the winter months, as temperatures fall and demand for heating fueled by natural gas rises. But mild weather coupled with high production levels have kept prices depressed in recent weeks.

Global financial service provider Barclays said in a report Tuesday that, “In the near term, there appears to be no bottom for the front contract price as it continues to fall on weak seasonal heating demand."

Elsewhere on the NYMEX, light sweet crude oil futures for delivery in January plummeted 3.05% to trade at USD97.08 a barrel, while heating oil for January delivery tumbled 1.6% to trade at USD2.882 per gallon.

EUR/USD plumbs 11-month low on downgrade fears ..

The euro slumped to an 11-month low against the U.S. dollar on Wednesday, as speculation over euro zone sovereign ratings downgrades supported demand for the safety of the greenback.

EUR/USD hit 1.2991 during U.S. morning trade, the pair’s lowest since January 12; the pair subsequently consolidated at 1.2982, shedding 0.42%.

The pair was likely to find support at 1.2872, the low of January 10 and resistance at 1.3064, the session high.

Sentiment on the euro has weakened in recent days on the view that last week's European Union summit did not result in a decisive plan to resolve the debt crisis in the region.

Concerns over mass ratings cuts across the euro zone persisted despite adequate investor demand at auctions of Italian and German government debt earlier in the day.

Italy’s Treasury sold the full targeted amount of EUR3 billion of five-year government bonds, but saw bond yields rise to a euro-era highs.

Germany auctioned EUR4.18 billion of two-year bonds at record low yields, reassuring investors after an auction of 10-year bonds last month met with extremely weak investor demand.

Meanwhile, demand for the greenback remained supported after the Federal Reserve warned that market turbulence stemming from the crisis in the euro zone posed a threat to the U.S. economy but stopped short of indicating fresh stimulus measures to shore up growth.

The euro was also lower against the pound, with EUR/GBP shedding 0.21% to hit 0.8403.

Also Wednesday, official data showed that industrial production in the euro zone declined unexpectedly in October, falling for the second consecutive month.

U.K. PPI input rises unexpectedly ..

Producer price inflation input in the U.K. rose unexpectedly last month, official data showed on Friday.

In a report, National Statistics said that U.K. PPI input rose to a seasonally adjusted 0.1%, from -0.8% in the preceding month.

Analysts had expected U.K. PPI input to fall -0.1% last month.

Swiss employment level rises more-than-expected in Q3..

The number of people employed in Switzerland rose more-than-expected in the third quarter, official data showed on Monday.

In a report, the Swiss Federal Statistics Office said that the number of employed people in Switzerland rose to a seasonally adjusted 4.05 million during the third quarter, up from 4.02 million in the preceding quarter, whose figure was revised up from 2.77 million.

Analysts had expected the Swiss employment level to rise to 4.04 million in the third quarter.

The report showed that for the first time in two years the employment outlook indicator and the number of job vacancies show a very slight decline in year-on-year comparison. Employment should, nevertheless, remain stable for the next quarter.

Following the release of the data, the Swiss franc held on to losses against the U.S. dollar, with USD/CHF gaining 0.5% to trade at 0.9278.

Natural gas tumbles to 13-month low on warm weather outlook ..

Natural gas futures were down sharply on Monday, tumbling to a 13-month low as warmer-than-normal winter weather in the U.S. underlined the view that gas supplies are more than ample to meet U.S. winter-heating needs.

On the New York Mercantile Exchange, natural gas futures for January delivery traded at USD3.247 per million British thermal units during U.S. morning trade, tumbling 2.13%. 

It earlier fell by as much as 2.55% to trade at USD3.217 per million British thermal units, the lowest price since October 22, 2010.

The Commodity Weather Group said Friday that it expected above-average temperatures along most parts of the U.S. East Coast through mid-December.

The weather group forecast temperatures to be at least five degrees warmer-than-normal along the East Coast and about three degrees higher in interior regions, according to its 6-to-10-day outlook.

Weather service provider AccuWeather offered a similar outlook, saying it expected temperatures in the U.S. Northeast and Midwest, key gas-consuming regions, to mostly range from normal to slightly above normal from December 13 to December 17.

Natural gas prices have closely tracked weather forecasts in recent weeks. Above-normal winter temperatures reduce the need for gas-fired electricity to heat homes, dampening demand for natural gas.

Concerns over record-high supply levels in the U.S. also added to the selling pressure. Currently, total U.S. natural gas supplies stand at 3.831 trillion cubic feet. 

Stockpiles are 8.7% above the five-year average and 102 billion cubic feet higher than last year at this time, underlining the view that U.S. gas supplies are sufficient to meet the needs of even an unusually harsh winter.

U.S. inventories typically increase during the so-called "shoulder season", the period in autumn after air-conditioning demand falls but before heating begins.

But this year's increase, aided by unusually warm temperatures, offers a much larger cushion than in most years as winter approaches.

Gas futures typically climb during the winter months, as temperatures fall and demand for heating fueled by natural gas rises. But mild weather coupled with high production levels have kept prices depressed in recent weeks.

Elsewhere on the NYMEX, light sweet crude oil futures for delivery in January dropped 1.45% to trade at USD97.97 a barrel, while heating oil for January delivery shed 0.2% to trade at USD2.906 per gallon.

EUR/USD extends losses, tumbles more than 1% ..

The euro extended losses against the U.S. dollar on Monday, tumbling more than 1% amid sustained concerns over European leaders handling of the debt crisis in the single currency bloc.

EUR/USD hit 1.3214 during U.S. morning trade, the pair’s lowest since October 4; the pair subsequently consolidated at 1.3216, tumbling 1.26%.

The pair was likely to find support at 1.3144, the low of October 4 and a10-month low and resistance at 1.3381, the session high.

European Union leaders agreed Friday to draft a new treaty to implement tighter fiscal consolidation across the euro zone and to provide EUR200 billion in loans to the International Monetary Fund to assist countries with debt problems.

But investors remained unsure over whether the measures would go far enough to resolve the debt crisis after the European Central Bank indicated that it had no plans to step up its bond purchasing program, capping weekly bond purchases at EUR20 billion.

Earlier Monday, Standard & Poor’s chief European economist said Friday’s agreement was a significant step in resolving a "crisis of confidence,” but warned that time is running out and more action is needed.

The comments came after S&P placed the credit ratings of 15 euro zone members, including France and Germany, on watch for a potential downgrade last week.

Sentiment on the single currency soured after Moody’s said it will review the ratings of all EU countries in the first quarter, saying Friday’s summit failed to deliver “decisive policy measures” to end the region’s debt crisis.

The euro was also sharply lower against the pound, with EUR/GBP falling 0.80% to hit 0.8472.

Also Monday, Italy’s Treasury sold the full targeted amount of EUR7 billion of 12-month government bonds at an average yield of 5.95% compared to 6.08% at a bond auction last month.

Following the auction, the yield on Italian 10-year government bonds climbed back towards the near unsustainable levels hit last month, rising to 7.18%.

Dollar rallies as euro zone woes spur flight to safety ..

The U.S. dollar was sharply higher against its major counterparts on Monday, as investors remained skeptical over whether Friday’s European Union agreement would be enough to resolve the debt crisis in the euro zone.

During U.S. morning trade, the dollar was up against the euro, with EUR/USD tumbling 1.25% to hit 1.3216.

Sentiment on the single currency was hit after Moody’s said it will review the ratings of all EU countries in the first quarter, saying Friday’s summit failed to deliver “decisive policy measures” to end the region’s debt crisis.

EU leaders agreed to draft a new treaty to implement tighter fiscal consolidation across the euro zone and to provide EUR200 billion in loans to the International Monetary Fund to assist countries with debt problems.

But investors remained unsure over whether the measures would go far enough after the European Central Bank indicated that it had no plans to increase its bond purchasing program, capping weekly bond purchases at EUR20 billion.

Earlier Monday, Standard & Poor’s chief European economist said Friday’s agreement was a significant step in resolving a "crisis of confidence,” but warned that time is running out and more action is needed.

The comments came after S&P placed the credit ratings of 15 euro zone members, including France and Germany, on watch for a potential downgrade last week.

The greenback was also higher against the pound, with GBP/USD shedding 0.27% to hit 1.5627.

Elsewhere, the greenback was stronger against the yen and the Swiss franc, with USD/JPY rising 0.32% to hit 77.86, and USD/CHF jumping 1.23% to hit 0.9344.

In Switzerland, official data showed that the number of people employed rose more-than-expected in the third quarter, but for the first time in two years the employment outlook indicator showed a vey slight decline in a year-on-year comparison.

In addition, the greenback was sharply higher against its Canadian, Australian and New Zealand counterparts, with USD/CAD surging 0.94% to hit 1.0264, AUD/USD tumbling 1.45% to hit 1.0069 and NZD/USD plunging 1.65% to hit 0.7625.

Earlier in the day, official data showed that Australia’s trade surplus increased less-than-expected in November. A separate report showed that Australian home loan approvals rose more-than-expected last month.

The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, jumped 1.17% to hit a two-month high of 80.07.

Also Monday, Italy’s Treasury sold the full targeted amount of EUR7 billion of 12-month government bonds at an average yield of 5.95% compared to 6.08% at a bond auction last month.

Following the auction, the yield on Italian 10-year government bonds climbed back above the critical 7% threshold, to levels widely seen as unsustainable.

EUR/USD up at the end of U.S. session ..

The Euro was higher against the U.S. Dollar on Friday after the release of U.S. data on Michigan Consumer Sentiment Index.

EUR/USD was trading at 1.3386, up 0.35% at time of writing.

The pair was likely to find support at 1.3282, today’s low, and resistance at 1.3486, Monday’s high.

Earlier in the day, preliminary data showed that U.S. UoM consumer sentiment rose more-than-expected to a seasonally adjusted 67.7 last month from 64.1 in the preceding month.

Analysts had expected UoM consumer sentiment to rise to 65.9 last month.

Meanwhile, the Euro was up against the British Pound and the Japanese Yen, with EUR/GBP gaining 0.08% to hit 0.8542 and EUR/JPY rising 0.31% to hit 103.89.

..USD/JPY edges lower as markets eye ECB/EU summit

The U.S. dollar edged lower against the yen on Thursday, as investors eyed the outcome of the European Central Bank’s policy meeting later in the day and hoped for positive results at this week’s European Union summit.

USD/JPY hit 77.57 during European morning trade, the pair’s lowest since December 1; the pair subsequently consolidated at 77.60, shedding 0.09%.

The pair was likely to find support at 77.47, the low of December 1 and resistance at 77.78, the high of December 7.

Market sentiment found support as the European Central Bank was expected to cut interest rates by 0.25% to 1% at its policy-setting meeting later Thursday.

Meanwhile, France and Germany were to present a plan to amend EU treaties which would allow for greater fiscal integration and stricter enforcement of budgetary discipline in the single currency bloc, at a two-day economic summit.

Earlier Thursday, government data showed that core machinery orders in Japan fell unexpectedly in October, tumbling 6.9% after an 8.2% decline the previous month.

Analysts had expected core machinery orders to rise 0.2% in October.

The yen was steady against the euro with EUR/JPY unchanged to hit 104.18.

Later in the day, the U.S. was to release official data on initial jobless claims.

NZD/USD higher as RBNZ leaves rates unchanged ..

The New Zealand dollar was slightly higher against its U.S. counterpart on Thursday, after the Reserve Bank of New Zealand left its benchmark interest rate unchanged but gains were limited amid uncertainty over the outcome of a key European Union summit.

NZD/USD hit 0.7817 during late Asian trade, the daily high; the pair subsequently consolidated at 0.7804, rising 0.09%.

The pair was likely to find support at 0.7722, the low of December 1 and resistance at 0.7927, the high of November 14.

The RBNZ left its benchmark interest rate unchanged at 2.5% earlier in the day.
Commenting on the decision, RBNZ Governor Alan Bollard mentioned “continuing difficulties related to sovereign and bank debt in a growing number of European economies resulting in high levels of volatility in financial markets.”

Market sentiment also found support as the European Central Bank was expected to cut interest rates by 0.25% to 1% at its policy-setting meeting later in the day.

Meanwhile, France and Germany were to present a plan to amend EU treaties which would allow for greater fiscal integration and stricter enforcement of budgetary discipline in the single currency bloc, at a two-day economic summit.

Elsewhere, the kiwi was higher against the Australian dollar with AUD/NZD shedding 0.15%, to hit 1.3179.

Earlier Thursday, official data showed that Australia’s unemployment rate rose unexpectedly in November, ticking up to 5.3%, while the number of people in employment fell by 6,300 after rising by 16,800 the previous month.

Later in the day, the U.S. was to release official data on initial jobless claims.

Canadian building permits surge in October ..

The number of new building permits issued in Canada jumped significantly more-than-expected in October, rebounding from three consecutive months of declines, official data showed on Tuesday.

In a report, Statistic Canada said the number of new building permits issued surged by a seasonally adjusted 11.9% in October, blowing past expectations for a gain of 1.9%.

September’s figure was revised to a drop of 4.1% from a previously reported decline of 4.9%.   

Year-on-year, Canadian building permits issued in October rose at an annualized rate of 2.2%, after tumbling 12.1% in September.  

After three consecutive monthly decreases, the value of building permits issued by Canadian municipalities rose 11.9% to CAD6.3 billion in October. The increase came from the non-residential sector, particularly in Ontario.

The value of non-residential permits rose 32.8% to CAD2.7 billion in October, following three consecutive monthly declines.

In the residential sector, the value of permits edged down 0.1% to CAD3.6 billion in October. This was the component's third straight monthly decline.

Following the release of the data, the Canadian dollar remained lower against its U.S. counterpart, with USD/CAD gaining 0.33% to trade at 1.0197.

..U.S. stocks mostly higher on IMF loan package; Dow up 0.38%

U.S. stock markets closed mixed on Wednesday, as investors weighed the potential impact of the pending European summit.
At the close of U.S. trade, the Dow Jones Industrial Average gained 0.38%, the S&P 500 pushed higher by 0.17%, while the Nasdaq Composite index gave back 0.07%.
Late session news that the G20 is considering a USD600 billion International Monetary Fund lending program to the euro zone lifted stocks.

However, uncertainty regarding the effectiveness of the European Union summit and negative news out of Italy kept the bulls in check during most of the session.

Despite news from the financial sector that Citigroup will be slashing 4500 jobs and taking a USD400 million charge, shares of the bank advanced 0.61%.
On the retail front, woman's clothier Talbots soared over 60% after private equity firm Sycamore Partners made a takeover offer.
Meanwhile in earnings news, defense contractor SAIC climbed 6% after beating earnings estimates.

Across the Atlantic, European markets were with The EURO STOXX 50 lower by 0.50%, France's CAC 40 given back 0.11%, Germany's DAX dropped 0.57%, while Britain's FTSE 100 fell 0.39%.
Earlier Wednesday, U.S. mortgage data showed a surprising improvement adding to the domestic bullishness.

German factory orders significantly higher in October ..

German factory orders rose significantly more-than-expected in October, rebounding from the preceding month’s steep decline, official data showed on Tuesday.

In a report, Deutsche Bundesbank said factory orders jumped by a seasonally adjusted 5.2% in October, blowing past expectations for a 1.0% increase.

September’s figure was revised to a 4.6% drop from a previously reported 4.3% decline.

Year-over-year, German factory orders rose at an annualized rate of 5.4% in October, after climbing at a rate of 2.4% in September. Analysts had expected year-on-year German factory orders to rise at an annualized rate of 1.9%. 

Following the release of the data, the euro turned higher against the U.S. dollar, with EUR/USD edging 0.14% higher to trade at 1.3422.

Meanwhile, European stock markets were mixed. The EURO STOXX 50 eased down 0.05%, France’s CAC 40 added 0.05%, the FTSE 100 rose 0.25%, while Germany's DAX shed 0.4%. 

 

 

Canadian Ivey PMI rises more-than-expected in November ..

Canada's Ivey purchasing managers’ index rose more-than-expected in November, industry data showed on Tuesday.

In a report, the Richard Ivey School of Business said its purchasing managers’ index rose by 5.5 points to 59.9 in November from a reading of 54.4 in October.

Analysts had expected the index to rise by 0.6 points to 55.0 in November.

A figure above 50.0 indicates industry expansion, below indicates contraction.

According to the data, the Employment Index declined to 49.4 in November from 51.4 in October. The Prices Paid Index rose to 68.1 from 63.9, while the Deliveries Index advanced to 44.8 from 43.3 in the previous month.

Following the release of the data, the Canadian dollar added to gains against its U.S. counterpart, with USD/CAD falling 0.35% to trade at 1.0128.

Euro zone retail sales rise more-than-expected in October ..

Retail sales in the euro zone rose more-than-expected in October, official data showed on Monday.

In a report, Eurostat said retail sales rose by a seasonally adjusted 0.4% in October, beating expectations for a 0.1% increase.

The previous month’s figure was revised to a drop of 0.6% from a previously reported 0.7% decline.

Year-over-year, retail sales in the euro zone fell at an annualized rate of 0.4% in October, after dropping at a rate of 1.4% in September and better-than-expectations for a 0.8% drop.

Following the release of the data, the euro extended gains against the U.S. dollar, with EUR/USD climbing 0.46% to trade at 1.3454.

Meanwhile, European stock markets were broadly higher. The EURO STOXX 50 jumped 1.3%, France’s CAC 40 rose 1.2%, the FTSE 100 added 0.55%, while Germany's DAX gained 0.8%.

Distinctive :U.S. ISM non-manufacturing PMI falls to 22-month low ..

Service sector activity in the U.S. declined unexpectedly in November, slumping to the lowest level since January 2010, industry data showed on Monday.

In a report, the Institute of Supply Management said its non-manufacturing purchasing manager's index fell by 0.9 points to 52.0 in November from 52.9 in October. 

Analysts had expected the index to rise by 0.5 points to 53.4 in November.

This is the lowest reading since January 2010, when the index registered 50.7 points.

On the index, a reading above 50.0 indicates the non-manufacturing sector economy is generally expanding, below 50.0 indicates the sector is contracting.

The New Orders Index increased by 0.6 points to 53.0, while the Employment Index dropped 4.4 points to 48.9, indicating contraction in employment after one month of growth.

Following the release of the data, the U.S. dollar held on to losses against the euro, with EUR/USD rising 0.48% to trade at 1.3457.

Meanwhile, U.S. stock markets remained sharply higher after the open. The Dow Jones Industrial Average jumped 1.15%, the S&P 500 index rallied 1.35%, while the Nasdaq Composite index gained 1.2%.

USD/JPY down during the U.S. session ..

The U.S. Dollar was lower against the Japanese Yen on Monday.

USD/JPY was trading at 77.84, down 0.19% at time of writing.

The pair was likely to find support at 77.30, Wednesday’s low, and resistance at 78.16, Wednesday’s high.

Meanwhile, the U.S. Dollar was down against the Euro and the British Pound, with EUR/USD gaining 0.23% to hit 1.3422 and GBP/USD rising 0.34% to hit 1.5651.

U.S. markets close higher; Dow Jones up 4.24% ..

U.S. stocks were up after the closing bell on Wednesday.

At the close of U.S. trade, the Dow Jones Industrial Average rose 4.24%, the S&P 500 index gained 4.33%, while the Nasdaq 100 index climbed 3.79%.

Earlier in the day, official data showed that non-farm employment change in the U.S. rose more-than-expected to a seasonally adjusted 206K last month, from 130K in the preceding month whose figure was revised up from 110K.

Analysts had expected U.S. non-farm employment change to rise 130K last month.

Meanwhile, across the Atlantic, European stock markets closed higher. France’s CAC 40 was up 4.22%; Germany’s DAX gained 4.98%; Britain’s FTSE 100 climbed 3.16%; and the EURO STOXX 50 rose 4.31%.

GBP/USD down toward the end of European session ..

The British Pound was lower against the U.S. Dollar on Friday after the release of U.S. data on Unemployment Rate.

GBP/USD was trading at 1.5590, down 0.64% at time of writing.

The pair was likely to find support at 1.5459, Monday’s low, and resistance at 1.5780, Wednesday’s high.

Earlier in the day, official data showed that the U.S. unemployment rate fell unexpectedly to a seasonally adjusted 8.6% last month, from 9.0% in the preceding month.

Analysts had expected the U.S. unemployment rate to remain unchanged at 9.0% last month.

Meanwhile, the British Pound was down against the Euro and the Japanese Yen, with EUR/GBP gaining 0.01% to hit 0.8580 and GBP/JPY falling 0.41% to hit 121.41.

U.S. futures mixed to lower as E.Z. concerns weigh; Dow Jones down 0.19% ..

U.S. stock futures pointed to a weaker open on Thursday, reversing the previous day’s strong rally as concerns over the debt crisis in the euro zone continued to dominate market sentiment.

Ahead of the open, the Dow Jones Industrial Average futures pointed to a decline of 0.19%, S&P 500 futures signaled a 0.31% drop, while the Nasdaq 100 futures indicated a 0.05% loss.

Market sentiment found support earlier, after well received French and Spanish bond auctions. Spain’s Treasury auctioned the full targeted amount of EUR3.75 billion of government bonds, while France auctioned EUR4.5 billion of debt.

But investors remained jittery after European Central Bank President Mario Draghi said downside risks to the economic outlook have increased, adding that the bank's temporary measures are only limited.

Netflix saw shares decline 4.67% after Wedbush Securities downgraded the stock to “underperform,” citing concern over subscriber losses, rising content costs and Netflix's “growth at all costs” business model.

Meanwhile, financial stocks were sharply higher after the Federal Reserve and five other central banks lowered the cost of dollar funding and China cut its reserve rates for banks on Wednesday.

Shares in Citigroup surged 8.87% and JP Morgan jumped 8.44%, while Goldman Sachs and Bank of America soared 7.94% and 7.30% respectively.

In the telecom sector, AT&T shares soared 3.28% after reporting it was discussing options with T-Mobile USA's parent Deutsche Telekom, including forming a joint venture to pool the wireless operators' network assets.

Pfizer, the maker of Lipitor was up 3.45%, as it was hoping to hold on to at least a third of the 3 million Americans who take the high-selling cholesterol fighter, as the medication went generic on Wednesday.

Other stocks in focus included Yahoo, following reports that Blackstone, Bain, Alibaba and Softbank are in formal discussions about a bid for the internet corporation.

Across the Atlantic, European stock markets were mixed. The EURO STOXX 50 fell 0.53%, France’s CAC 40 declined 0.61%, Germany's DAX dropped 0.75%, while Britain's FTSE 100 gained 0.41%.

During the Asian trading session, Hong Kong's Hang Seng Index soared 5.6%, while Japan’s Nikkei 225 Index jumped 1.95%.

Later in the day, the U.S. was to release its weekly report on initial jobless claims, while the Institute of Supply Management was to release data on manufacturing activity.

U.S. stocks mixed after weak jobless claims; Dow Jones down 0.10%

U.S. stocks were mixed on Thursday, after downbeat U.S. jobless data and as concerns over the debt crisis in the euro zone continued to weigh on market sentiment.

During early U.S. trade, the Dow Jones Industrial Average fell 0.10%, the S&P 500 index eased up 0.02%, while the Nasdaq Composite index rose 0.46%.

The U.S. Department of Labor said the number of people who filed for unemployment assistance in the U.S. last week rose unexpectedly, climbing above 400,000 for the first time in three weeks.

Market sentiment found support earlier, after well received French and Spanish bond auctions. Spain’s Treasury auctioned the full targeted amount of EUR3.75 billion of government bonds, while France auctioned EUR4.5 billion of debt.

But investors remained jittery after European Central Bank President Mario Draghi said downside risks to the economic outlook have increased.

Yahoo surged 4.04% on reports that a consortium including Blackstone, Bain, Alibaba and Softbank have started formal discussions about a bid for the search-engine company for about USD25 billion.

Elsewhere, Macy’s saw shares jump 1.05%, Limited Brands advanced 0.59% and Buckle rose 0.25%, due to strong Black Friday sales.

Pfizer, the maker of Lipitor was up 0.45 %, as it was hoping to hold on to at least a third of the 3 million Americans who take the high-selling cholesterol fighter, as the medication went generic on Wednesday.

On the downside, shares in Lululemon Athletica plummeted 13.54% after the yoga apparel retailer said sales growth in existing stores declined and added it saw no substantial pickup in the current quarter.

Financial stocks were also broadly lower, reversing Wednesday’s strong rally posted after the Federal Reserve and five other central banks lowered the cost of dollar funding.

Shares in Citigroup tumbled 1.42% and Goldman Sachs slumped 1.20%, while JP Morgan and Bank of America declined 0.84% and 0.55% respectively.

Across the Atlantic, European stock markets were mixed. The EURO STOXX 50 inched up 0.07%, France’s CAC 40 eased up 0.06%, Germany's DAX dropped 0.14%, while Britain's FTSE 100 gained 0.71%.

During the Asian trading session, Hong Kong's Hang Seng Index soared 5.6%, while Japan’s Nikkei 225 Index jumped 1.95%.

Later in the day, the Institute of Supply Management was to release data on manufacturing activity.

EUR/USD up at the end of U.S. session

The Euro was higher against the U.S. Dollar on Thursday after the release of U.S. data on Initial Jobless Claims.

EUR/USD was trading at 1.3464, up 0.13% at time of writing.

The pair was likely to find support at 1.3260, Wednesday’s low, and resistance at 1.3532, Wednesday’s high.

Earlier in the day, official data showed that U.S. Initial Jobless Claims rose unexpectedly to a seasonally adjusted 402K last week from 396K in the preceding week whose figure was revised up from 393K.

Analysts had expected Initial Jobless Claims to fall to 390K last week.

Meanwhile, the Euro was up against the British Pound and the Japanese Yen, with EUR/GBP gaining 0.20% to hit 0.8582 and EUR/JPY rising 0.23% to hit 104.61.

U.S. markets mixed at close; Dow Jones down 0.21% ..

U.S. stocks were mixed after the closing bell on Thursday.

At the close of U.S. trade, the Dow Jones Industrial Average fell 0.21%, the S&P 500 index shed 0.19%, while the Nasdaq 100 index climbed 0.61%.

Meanwhile, across the Atlantic, European stock markets closed lower. France’s CAC 40 was down 0.78%; Germany’s DAX shed 0.87%; Britain’s FTSE 100 declined 0.29%; and the EURO STOXX 50 fell 0.71%.