Archive for the ‘Barack Obama’ category

Safe Havens Back Down

August 26, 2010

The yen, the US dollar and the Swiss franc all fell in this morning’s early trade – can you see the pattern?

Yes, all three are traditionally seen as ‘safe havens’ in an otherwise rocky market – yet today investors headed away from them on the back of healthier commodity increases.

Meanwhile the Japanese authorities are still rumoured to be thinking about intervening on the yen’s strength.

Also in the news: central banks are meeting at the US Fed’s mountain retreat to talk about the state of the global economy.  Is it recovering well enough?  Are we on the edge of another cliff, about to tumble back into recession?  Do we need to print more money to give things a boost?  These and other key topics are likely to be discussed.

Global Shares Fall

June 29, 2010

Tuesday and shares have fallen around the world on the back of investor nerves.

Heading back to safer assets, investors are nervous on bank repayments to the European Central Bank later this week.  With large repayments due, a healthy portion of financial liquidity will be removed.  The euro fell as many headed back to the US dollar in this morning’s early trade in London.

Meanwhile BP shares have taken a further knock after the company announced its cleanup operation might be affected by tropical storm Alex, which might head for those areas hit by the oil spill.

Market Moves ahead of Weekend

June 24, 2010

It’s nearly time for another weekend, one which promises to bring fraught nerves and emotion.  Are we talking about a G20 summit or economic data announcement? No…this is far more important to most inhabitants of two European countries:

England VS Germany on Sunday in the World Cup.

But while the weekend, with its peak (or trough) on Sunday, may be around the corner there are still those who are focussing on the job in hand.  Today, Australia announced its first female Prime Minister.  Julia Gillard took over the pole political position after former PM Kevin Rudd chose to throw in the towel ahead of an internal ballot.

The news brought strength to the Australian dollar, which surged against its New Zealand counterpart.  Minining stocks also got a boost, as it seemed likely that the controversial mining tax will receive more attention and review by Ms Gillard.

Markets lost momentum (or interest?) in the topic later on though, with European stock slumps and another weak euro versus the yen and the dollar.  No prizes for guessing why (hint: Greece).

BP Shares Plummet

June 10, 2010

Share dealers will have seen an interesting morning this morning as BP share prices plummeted in early trade in the London session.

The oil company has received widespread condemnation for its part in the oil spill disaster in the Gulf of Mexico, which began on April 20th.  With anger and reprimands coming from the global community and led by those as prominent as US President Barack Obama, BP has a tough road ahead.  The UK’s reputation is also on the line, according to some.  As a British-based company, BP has drawn “anti-British rhetoric” from the US, says London mayor Boris Johnson.

This morning, BP shares fell to their lowest in 13 years before recovering slightly.  UK pensions are affected, given their heavy investment in the company.

Sarkozy – Public Display of Support for Greece

March 8, 2010

Greece got a boost from French President Nicolas Sarkozy yesterday, after talks between himself and Greek Prime Minster George Papandreou.

So far, EU leaders have been less than enthusiastic about helping Greece in a big bailout package.  Luckily for them, the country does not (so far) need a package, having already announced austerity measures to tackle the massive 12.7% deficit problem.

Mr Sarkozy attacked speculators on the foreign exchange market and on the bonds market, for attacking the euro.  Indeed, in recent months the amount of positions against the euro reached record levels.  However, after the French President’s comments, the currency took a boost and rose against the US dollar.

Are speculators going too far, or are they right to avoid the single currency as Greece – and possibly other EU nations – struggle to tackle their major fiscal problems?

Central US Interest Rate to Stay Low

February 25, 2010

US Federal Reserve chief Ben Bernanke has said that the base interest rate there is to remain low for an extended period. According to the central bank, it is just too early in the recovery process to begin to raise rates.  Not that markets were complaining – US stocks jumped by over 1% following Mr Bernanke’s comment.

Last week, the Fed took everyone by surprise by suddenly raising the discount rate (that is the rate at which banks receive emergency loans) to 0.5% from 0.75%.  It wasn’t the act itself which shocked the market but the timing – it happened much sooner than expected.  Consequently, US stocks had slipped as did the USD.

Meanwhile in the UK, the Bank of England has once again released a wave of uncertainty, by giving an ambiguous stance on asset-buying.  Yes, they decided to finish the 200 billion pound quantitative easing programme at the last policy meeting.

But now it appears as though they are considering re-installing it if inflation doesn’t head nearer to target soon.  The comment echoed a similarly downbeat tone from BoE head Mervyn King earlier in the week, and brought a weakening of the pound by almost a cent to just below $1.54 against the US dollar.

Banks VS Obama

January 28, 2010

The battle lines are drawn.  The fight has commenced.  Who will win and what will change?

The war is between leaders Obama, Brown and Sarkozy VS the Big Banks.  The former three (well, in Brown’s case it was more other representatives of his team – Mr King for one) have all made a clear stance on how they think the banking systems of their- and other nations should change – drastically.

Now, heads of some of the world’s largest banks have fought back, sayingt that they see no evidence that cutting up their corporations into smaller ones would make any changes for the better.  Furthermore, they blame US and UK leader of being too concerned with domestic concerns (such as local elections).

Meanwhile over in the foreign exchange market, the pound is still riding high against the euro – the latter having problems thanks in part to the economic woes from Greece and Portugal.