By 11am, the FTSE 100 had rallied 0.5% to trade above key resistance levels to reach 5820.

We have seen general profit taking in mining stocks, with shares spread betting investors happy to take some gains off the table after a strong 48 hours trading that has seen the FTSE 350 mining sector rally over 7%.

Rio Tinto, BHP Billiton and Fresnillo were three of a cluster of miners that fell as a result, whilst Xstrata and Glencore, who announced merger talks yesterday sending their respective shares higher by 7%-10%, have seen share prices settle down somewhat today.

All eyes now switch to the lunchtime reading of US jobs with payrolls growth expected to slow somewhat from December’s forecast beating numbers.

After the Fed’s dovish pledge in their latest FOMC meeting, this may well have dampened expectations somewhat for a continuation of December’s bullish jobs growth numbers.

As this jobs reading could well be aligned strongly with prospects for further quantitative easing, a weaker than expected reading could see any bearish stock market reaction limited in the medium term.

Furthermore, the data could potentially pose a double negative for the US dollar as a weak economic signal whilst also raising the potential for more QE.

BT Group’s shares saw support after the telecom firm reported third quarter results that broadly met market forecasts. Third quarter revenues fell 5% to £4.8bn whilst adjusted EBITDA rose 3% to £1.5bn and net debt fell by £1bn.

The firm continues to rely on cost cutting measures and efficiencies to help stretch profit margins at a time when sales are pressurised.

One of the positives to take from today’s results is the fact that its broadband services continue to maintain a strong footing in the UK market, with 146,000 new retail customers added whilst 95,000 customers took up its faster BT Infinity broadband services.

The results sent BT shares higher by 3%, with prices hitting a new three-and-a-half-year high as a result.

Admiral Group shares topped the FTSE 100 however, with prices rising 7%, after the firm said it had extended its reinsurance arrangements with its UK car insurance until 2014.

The share prices have charged higher due to the removal of uncertainty towards the renewal, whilst the fact that the costs of the extension are unchanged has also been received well by shareholders.

Please remember that Spread Betting and CFD Trading are leveraged products that carry a high level of risk to your capital and can result in losses that could quickly exceed your initial outlay. These products may not be suitable for everyone, so please make sure you fully understand the risks involved.

Spread Betting and CFD comments by Joshua Raymond, Chief Market Strategist, City Index.

The above should not be construed in any circumstances as a recommendation or offer to sell or recommendation or solicitation of any offer to buy any security or other financial instrument.

Neither City Index nor Spread-Betting.org warrant or represent that the material is accurate, complete, not misleading, or fit for the purpose which it is intended and it should not be relied upon as such.

Current expectations are for the rate of US jobs growth to recede somewhat from a surprisingly strong December labour market.

December’s labour force was always expected to gain strength as businesses catered for the likely increase in consumer activity over the holiday period.

The strength of December’s jobs increase is now expected to see a slowing of hiring in the US last month as businesses scale back somewhat.

Consensus:

		Previous		Consensus
Non-Farm Payrolls		200,000		135,000
Private Payrolls		212,000		170,000
Unemployment Rate		8.5%		8.5%

 
Expectations:

Each of the three critical measures of US jobs data in December vastly surpassed online spread betting market expectations and gave stocks strong support.

But it could be somewhat premature to start believing that US growth will quicken in pace and monthly non-farm payrolls could maintain a growth of circa 200,000 consistently in the first half of 2012.

Indeed, much of the strength of December’s jobs market was correlated to a 42,000 spike in the hiring of couriers and this likely exacerbated the measurement somewhat and on a temporary nature.

January’s reading is expected to show the rate of jobs growth declining as a result.

US data over the past week has been somewhat mixed. Earlier in the week was saw Chicago PMI and Consumer Confidence both miss estimates.

ADP employment data out yesterday marginally missed forecasts with a growth in private jobs of 170,000, which was a marked slowdown from a previous downwardly revised reading of 292,000.

Add to the mixed US economic data the fact that the language from the Federal Reserve recently turned much more dovish, indicating some degree of hesitation that US growth is far from locked in on its current trajectory path.

The Fed even went so far as to pledge to maintain interest rates at exceptionally low levels through to 2014 and hinted that more quantitative easing remains in their arsenal of supportive weapons to stimulate US growth.

The Fed’s dovish stance may keep US economic data somewhat volatile going forward as a result.

So the dots are connecting relatively clearly for a slowdown in jobs creation for Friday’s reading.

Despite this, the shares spread betting market reaction to the data could well be a tale of two stories, depending on the long term nature of which traders focus on.

A better than expected growth in jobs could help to convince the strength of the US economic recovery and potentially lift stocks as spread betting investor appetite for risk gains.

However a stronger US economic recovery pushes the prospect of more QE further aside, posing a somewhat negative caveat to the data.

Any potential losses that may be triggered from a data disappointment could be curbed however by higher hopes that slowing job creation could trigger the Fed into QE3 action.

Traders in UK and US stocks, alongside currencies, need to be on guard for some added price volatility as traders position themselves in the run up to the jobs release, whilst the immediate aftermath of the release historically can create wide price swings.

Please remember that Spread Betting and CFD Trading are leveraged products that carry a high level of risk to your capital and can result in losses that could quickly exceed your initial outlay. These products may not be suitable for everyone, so please make sure you fully understand the risks involved.

Spread Betting and CFD comments by Joshua Raymond, Chief Market Strategist, City Index.

The above should not be construed in any circumstances as a recommendation or offer to sell or recommendation or solicitation of any offer to buy any security or other financial instrument.

Neither City Index nor Spread-Betting.org warrant or represent that the material is accurate, complete, not misleading, or fit for the purpose which it is intended and it should not be relied upon as such.

European stocks had earlier enjoyed a more positive session on Tuesday, as heavyweight resource stocks bounced back from yesterdays profit taking whilst several blue chip companies reported stronger earnings.

However, gains were kept on a bit of a leash and as soon as the US economic data disappointed the market, investors moved quickly to lock in their days gains early.

A raft of stronger than expected UK company earnings had helped to brighten sentiment yesterday and this encouraged many spread betting investors to trade with a more positive footing than yesterdays’ bearish start to the week.

BSkyB, ARM Holdings and National Grid all delivered earnings or trading updates that either met or beat market expectations, giving their individual share prices a lift and improving sentiment broadly.

US data sends stocks tumbling in afternoon trading

However, a badly disappointing set of economic data out of the US in the form of Chicago PMI and Consumer Confidence took the shine of stocks in the afternoon session, forcing a retracement in share prices from their daily highs.

The FTSE 100 index spread betting market had been trading higher by near 1% before both sets of US economic data disappointed, sending the UK Index to close with gains of around 0.3%.

Chicago PMI fell unexpectedly in December to 60.2 from a revised 62.2 when the measure was expected to increase to 63.

One of the more alarming aspects towards the PMI data was the employment elements, which showed that purchasing employment fell to its lowest levels since last August. With non farm payrolls due out on Friday, this could be somewhat of a troubling element in the run up to Fridays jobs data.

US Consumer Confidence also fell surprisingly, with the measure falling to 61.1 from an upwardly revised 64.8, when it had been expected to rise to 68.0.

The fall again left a somewhat sour taste in the mouth and triggered some bearish moves in stocks towards the close, particularly given the fact that most US data has outperformed of late.

Given the Fed’s dovish stance, should we get used to weaker data?

However, should we really be too surprised given the disappointment of yesterday’s data, given the dovish stance adopted by the Fed in their latest FOMC meeting.

That dovish stance, which pledged to keep US interest rates exceptionally low through to 2014 and hint at a potential for more QE, raised a few sceptical eyebrows.

Perhaps US growth is likely to falter somewhat and that we should start to expect weaker economic data.

Yesterday’s data, along with last weeks’ GDP disappointment could merely be the start of that.

This of course tee’s ourselves up nicely for today’s ADP employment report and Friday’s non farm payrolls.

Traders may do well to anticipate a somewhat mixed reaction to US data going forward as weaker than expected data in the near-term could raise fears of US growth slowdown.

However, in the medium-term, this may help to convince the Fed to act through a third phase of quantitative easing, which is likely to increase financial spread betting investors’ appetite for risk.

Please remember that Spread Betting and CFD Trading are leveraged products that carry a high level of risk to your capital and can result in losses that could quickly exceed your initial outlay. These products may not be suitable for everyone, so please make sure you fully understand the risks involved.

Spread Betting and CFD comments by Joshua Raymond, Chief Market Strategist, City Index.

The above should not be construed in any circumstances as a recommendation or offer to sell or recommendation or solicitation of any offer to buy any security or other financial instrument.

Neither City Index nor Spread-Betting.org warrant or represent that the material is accurate, complete, not misleading, or fit for the purpose which it is intended and it should not be relied upon as such.

In any case the FTSE 100 looks set to post its best month since October and that isn’t something to grumble about.

Some positive company updates have also helped sentiment with ARM Holdings cheering spread betting investors with a trading update that beat expectations with pre-tax profits jumping 37% from £167.4m to £229.7m.

Given Apple’s blow-out numbers last week it would have been surprising if they hadn’t done well.

Satellite broadcaster BSkyB also beat market expectations by announcing a half yearly operating profits increase of 16%.

On the downside banks have continued to drag with Lloyds, RBS and Barclays all slipping back.

US Indices Spread Betting markets opened higher taking their lead from the more upbeat sentiment in Europe, though economic data has seen the market slip back.

The rise was assisted by decent quarterly earnings from stock heavyweights Pfizer, Eli Lilly and UPS all succeeding in topping estimates.

The economic docket releases thwarted any real upside in early trade; with the Chicago PMI hitting its lowest level since August last year, coming in at 60.2 against an expectation of 63.0.

Consumer confidence also disappointed; retreating to 61.1 and a significant undershoot of the 68.0 consensus expectation.

It’s been a bit of a mixed bag for currencies today with the single currency finding it difficult to build on its recent gains, slipping back against the US dollar and the pound after German retail sales slid sharply by 1.4% in December.

Even though German unemployment fell again to a post-unification low of 6.7% this was an isolated case as unemployment rose everywhere else in Europe.

Italy’s unemployment rate rose to 8.9% while Euro zone unemployment rose to an all-time high of 10.4%.

The pound has had a more positive day after consumer confidence rebounded slightly to its highest levels for a few months; however the consumer credit numbers suggest that consumer’s remain in retrenchment mode, sliding by £0.4bn in December.

The Swiss franc continues to push gradually towards its ceiling against the euro at 1.2000 and there could be a tendency for traders to position themselves in anticipation of some intervention.

This could actually see any bounce be short-lived in the event of intervention, or in the absence of it, could see it slip below 1.2000 in the coming days.

Intervention only works well when the spread betting market is positioned the wrong way round, just ask the Japanese, and for now the market is not overly long Swiss francs.

Crude oil prices have remained fairly buoyant as equity markets close the month in fairly positive fashion, held up by concerns in the Middle East and a slightly more positive tone in Europe.

Gold prices remain underpinned by speculation about easier central bank monetary policy, however silver prices have lagged behind somewhat.

Copper prices have retained their weaker tone from yesterday ahead of Chinese manufacturing PMI data due out on Wednesday which is expected to show a contraction to 49.6.

 
 
Please remember that Spread Betting, FX and CFDs are leveraged products and carry a high level of risk to your capital. It’s possible to lose more than your initial investment. These products may not be suitable for all investors, please ensure you understand the risks involved and seek independent advice if necessary.

Spread Betting, FX and CFD comments by Michael Hewson, Market Analyst, CMC Markets.

The above should not be construed in any circumstances as a recommendation or offer to sell or recommendation or solicitation of any offer to buy any security or other financial instrument.

Neither CMC Markets nor Spread-Betting.org warrant or represent that the material is accurate, complete, not misleading, or fit for the purpose which it is intended and it should not be relied upon as such.

As January comes to an end, stock prices continued to gain with the Dow Jones pushing towards a three and a half year high.

European shares rose on Thursday, halting two days of losses as bond auctions took a back seat with the US Federal Reserve announcement that interest rates would remain low for a considerably longer than expected period the key factor.

The US also declared that it is ready to offer additional stimulus to boost economic growth. Off the back of this news the price of the gold spread betting markets shot up as the dollar weakened.

However, stock gains were capped as the Greek talks failed to materialise a final solution to the debt swap situation with Eurozone finance ministers rejecting the offer from the private bondholders.

The ECB has recognised that it will take a hit on Greek bond losses. There was, as has been the vogue in January, a bond auction with Germany selling €2.54bn of 1 year zero coupon bonds on Monday.

ECB statements were aplenty with Noyer commenting that French growth should pick up after stagnation in Q4 and Wiseman echoing a similar outlook for Germany with a more dynamic economic climate returning in 2012.

The European Union went through with its planned embargo on Iranian Oil Imports with the ban coming into effect from the 1st July. This sanction will also ban European companies including Total and Royal Dutch Shell from selling crude to non-EU destinations.

Outside of Europe, the Eastern world saw a quiet trading week with Chinese index spread betting markets closed all week in celebration of the Lunar New Year in the Year of the Dragon.

Japan announced their first trade deficit since 1980 with the yen weakening as a result. However, the continued strengthening of the yen against the dollar has prompted Bank of Japan intervention talks.

An IMF economist has commented that global recovery is in danger of stalling, with the IMF revising their forecast for global growth to 3.3% from 4% for 2012.

In America, unemployment remained below 400K and durable goods order changes came in better than expected with a 2.1% increase.

However, the main news concerned Apple who reported record quarterly revenues of $46.3bn powered by the sale of 37M iPhone devices. Its share price jumped nearly 10% in after-market trading before slipping back to a 7.5% gain.

At one point Apple became the world’s most valuable company with market capitalisation of $417bn before Exxon resumed that position by end of trading on Wednesday. Another big mover was healthcare company Illumina which rocketed to above $50 a share off the back a possible $5.7bn hostile takeover from Roche.

The mining industry was the focus of UK equity news with an upward movement across the sector.

Rockhopper reported interest from Anadarko and Gulf Keystone reported a positive update on how their Kurdistan operation was progressing.

Negative news came from Petroplus, Europe’s largest independent refiner, which is filing for insolvency after debt talks ran out of fuel.

Analysts say Petroplus’s administrators might struggle to find buyers for some of its plants in a market that has long suffered from overcapacity, poor profit margins and weak demand for petroleum products amid Europe’s economic downturn.

Heritage Oil announced they had been awarded further acreage in Tanzania, International Ferro Metals output was up 71% on the previous quarter with Anglo American and Lonmin also announcing production and output increases.

The Spread Betting Markets - The Coming Week:

Data builds up to the February Non-Farm announcement. Today is quiet, Tuesday sees the release of European countries unemployment change along with Canadian GDP figure.

Wednesday welcomes the release of the ADP unemployment figure and ISM Manufacturing along with Chinese manufacturing.

Thursday concerns UK construction and US unemployment claims with the main figure being the all-important Non-Farm Figure out at 1.30PM Friday, initially forecast at 151K.

An abundance of FTSE 100 companies reporting next week include National Grid, ARM Holdings, Vedanta and BskyB on Tuesday.

It’s United Utilities, ICAP and Imperial Tobacco turn on Wednesday and AstraZeneca, Unilever and Smith and Nephew’s on Thursday.

Spread betting is a leveraged product. It carries a high level of risk to your capital and, as it is possible to lose more than your initial investment, it may not be suitable for all investors. Therefore, ensure you understand the risks involved and seek independent advice if necessary. The tax treatment of spread bets may be subject to change in the future.

Article by Spreadex

The above should not be construed in any circumstances as a recommendation or offer to sell or recommendation or solicitation of any offer to buy any security or other financial instrument.

We have seen a bit of a slow start to trading today, with many shares spread betting investors happy to sit on their hands somewhat after yesterdays bounce higher from Wednesday’s lows.

However, with talks ongoing between private creditors of Greek debt and Greece over bond haircuts and US GDP figures due out at in the early afternoon, investors are naturally refraining from delving too deep into the markets today.

Both of these elements could send a few ripples into the stock market waters.

Greece talks eyed

Certainly the continuation of talks between Greece and its private creditors is maintaining a watchful edge to trading this week.

Whilst many investors believe that a deal will emerge before the March redemptions that could force Greece to default, constant disappointments over potential deals within the Eurozone over the past year dictates that traders maintain a watchful eye over developments for surprises.

In this sense, traders may do well to be mindful of a ‘buy the rumour sell the fact scenario’ that could emerge here.

At the very least, the negotiations is fast turning into a tv soap opera and just like soaps tend to finish the week at a tipping point of high drama, one hopes this is not the case with Greek bond talks this time around.

US GDP could see an interesting reaction

The US GDP figure could be a very interesting figure however. Data out at 1.30pm is expected to show that the US economy grew at its fastest pace in nearly two years at the end of 2011, by 3%.

Much of the support seen for stocks this week has come from optimism that the Federal Reserve will continue to adopt an accommodative stance through to 2014.

With potential room for more quantitative easing, a stronger than expected GDP reading today could leave a rather mixed reaction from FX spread betting investors.

On the one hand, a stronger GDP is both a good sign for the US economy, and that of global growth, but on the other hand, it may threaten the tools the Fed has at its disposal to stimulate growth.

As such, any potential jump higher in stocks from a stronger reading may be threatened once investor adrenaline wanes.

BP shares lag on ruling

BP shares are the leading faller in UK trade however, with prices falling 1% after a federal judge ruled that the oil giant must indemnify Transocean Ltd for compensation claims over the gulf of Mexico oil spill.

From a sector perspective, we have seen small gains in financial stocks and profit taking in both the miners and oil firms after yesterdays charge higher. Retail stocks have also enjoyed gains today, with the FTSE 350 retail sector gaining over 0.7% in trading.

Please remember that Spread Betting and CFD Trading are leveraged products that carry a high level of risk to your capital and can result in losses that could quickly exceed your initial outlay. These products may not be suitable for everyone, so please make sure you fully understand the risks involved.

Spread Betting and CFD comments by Joshua Raymond, Chief Market Strategist, City Index.

The above should not be construed in any circumstances as a recommendation or offer to sell or recommendation or solicitation of any offer to buy any security or other financial instrument.

Neither City Index nor Spread-Betting.org warrant or represent that the material is accurate, complete, not misleading, or fit for the purpose which it is intended and it should not be relied upon as such.

The dovish tone and highly accommodative stance taken by the Fed, which hints at a potential for more quantitative easing, gave US stocks a boost in trading last night.

There has been a firm follow through to European trading today, with resource stocks benefiting in particular.

By 10am, the FTSE 100 spread betting market had rallied 50 points to trade at 5773, with similar gains seen for the French CAC and German DAX indices.

It is now important for the FTSE 100 to break above strong resistance at 5820 if its near-term bullish form is to continue and help it to target the 6000 level once again.

It’s been a ‘risk-on’ start to trading firmly on the back of the FOMC pledge to strongly support the US economy through to 2014, which surprised some.

The sceptic in me would question what the Fed has seen to warrant a more aggressive accommodative stance, particularly considering recent US economic data has highlighted an improvement in US activity.

For now however, we have seen a positive reaction from spread betting investors who have taken the Fed’s pledge in their stride and aided their appetite for risk.

From a sector perspective, as one might expect with an accommodative stance from the Fed, it is resource stocks benefiting the most in trading.

The FTSE 350 mining sector has rallied over 2% in early trading as a result, and it is here where we can locate much of the FTSE’s early strength.

Financial stocks have also seen positive buying, with bank shares such as Lloyds Banking Group rallying 3% in the ‘risk-on’ environment.

Stronger mining updates

Stronger company earnings and updates have also given stocks a fillip to push higher and counter much of yesterday’s weakness.

Shares in Kazakhmys led the FTSE’s charge after the Kazakh focused miner posted annual copper production that broadly met forecasts and eased shareholders minds by forecasting a similar rate of production for 2012. 2011 output of copper came out at 299,000 tonnes.

Anglo American also reported well received earnings, with a 10% rise in copper output in the last quarter of 2011 helping to see the miner recover from a poor third quarter’s production that was hit by poor weather conditions.

Lonmin also saw its shares spread betting market receive a lift too as it updated shareholders.

Later in the session, traders will switch their attention to the release of weekly US jobless claims and US housing data, which may influence how UK and EU stocks close.

Please remember that Spread Betting and CFD Trading are leveraged products that carry a high level of risk to your capital and can result in losses that could quickly exceed your initial outlay. These products may not be suitable for everyone, so please make sure you fully understand the risks involved.

Spread Betting and CFD comments by Joshua Raymond, Chief Market Strategist, City Index.

The above should not be construed in any circumstances as a recommendation or offer to sell or recommendation or solicitation of any offer to buy any security or other financial instrument.

Neither City Index nor Spread-Betting.org warrant or represent that the material is accurate, complete, not misleading, or fit for the purpose which it is intended and it should not be relied upon as such.

The fall in GDP had been long expected given the headwinds facing the services sector and the breakdown of activity in the Eurozone, a large UK trading partner. As such, the contraction in Q4 was inevitable.

At the very least, the negative GDP reading will keep the pressure on both the Coalition government and the Bank of England to re-ignite the faltering UK economy through additional stimulus measures.

Though, with such a heavy reliance on Europe as a large UK trading partner, the UK’s economic fate lies in the hands of Brussels as much as London.

However, should today’s GDP reading escalate fears significantly of a marked period of negative quarterly UK GDP?

Perhaps not. The real concern for now remains the prospect of anaemic UK growth in the medium term than of a prolonged period of negative quarterly GDP.

More QE on the way appears likely

Today’s GDP data release from the Office of National Statistics, alongside minutes from the latest MPC meeting at the Bank of England strongly suggests that the UK’s Central Bank will now inject more firepower. More quantitative easing may be on its way to help the UK stave off a prolonged period of negative GDP..

There is every chance that next month, when the UK Central Bank will digest the latest quarterly inflation report, could announce an additional £75bn worth of asset purchases to reignite the UK economy. Data from today’s GDP or MPC minutes appears to emphasise this fact.

We saw stocks fall off in reaction to the worse than expected GDP reading, with the FTSE 100 trading down by 20 points on the day, whilst the pound sterling was broadly unchanged.

The lack of significant market reaction is likely to be down to the fact that today’s data will have been of no real surprise to most spread betting investors.

Please remember that Spread Betting and CFD Trading are leveraged products that carry a high level of risk to your capital and can result in losses that could quickly exceed your initial outlay. These products may not be suitable for everyone, so please make sure you fully understand the risks involved.

Spread Betting and CFD comments by Joshua Raymond, Chief Market Strategist, City Index.

The above should not be construed in any circumstances as a recommendation or offer to sell or recommendation or solicitation of any offer to buy any security or other financial instrument.

Neither City Index nor Spread-Betting.org warrant or represent that the material is accurate, complete, not misleading, or fit for the purpose which it is intended and it should not be relied upon as such.

The depressing nature surrounding ‘Blue Monday’ was bucked last week as shares spread betting markets climbed off the back of improved Eurozone consensus and quarterly reports out from America.

Following the S&P’s decision to cut many Eurozone countries ratings the emphasis was on the multiple debt auctions which on the whole produced promising results.

The EFSF, Netherlands, Belgium, Germany, Spain, France and even Greece held successful auctions with yields hovering around or decreasing from previous levels.

Spain report that they have now completed 20% of their targeted insurance policy for 2012. The Dax rose 5% off the back of this solid auction result and an economic sentiment figure which was at the highest level since last July, far exceeding expectation.

The Dax closed at 6410 on Thursday, its highest level since last August’s sell off. Other European countries were recipients of mixed news.

Russia’s long term rating was revised by Fitch from positive to stable, Bulgaria was praised by Merkel for their budget discipline and Fitch’s Parker said Greece was ‘insolvent and will default’.

Figures from the UK showed inflation at its lowest level since last April but there was an increase in those claiming benefits with unemployment at a 17 year high, 16-24 year old unemployment levels are at their highest levels since records began.

Away from Europe, this week sees China observe the Lunar New Year holiday with markets closed all week. Chinese quarterly growth came in just above forecast at 8.9%, its lowest level since late 2009 with copper and gold prices picking up off the back of this data.

The World Bank has warned both China and India to expect further global slowdown with the bank of Japan also downgrading its assessment of regional economies.

The IMF sees world growth at 3.3% in 2012 with the Eurozone shrinking by 0.5%. Oil was once again a sticky topic with the EU presidency calling for a full embargo on Iranian oil imports starting from the 1st July.

The Saudi Oil Minister called for Crude Oil price to stay at $100 a barrel but a fall in stockpiles saw the price climb above to $102 on Thursday.

Across the pond it was a busy week for equities in America with many reporting. Figures showed a positive outlook with unemployment claims down to 352K and long term purchases greatly exceeding expectation.

The Philly Fed manufacturing figure came in lower than expected but still shows improving conditions.

Equity reports were the talk of the street and Silicon Valley with all the big American Banks and Tech companies reporting.

Citigroup reported missed targets and an 11% fall in profits, Wells Fargo on the contrary posted a 20% increase in 4th quarter profits.

Goldman Sachs reported a 58% fall in profits, beating analysts’ expectations.

Northern Trust stated that they aim to cut 700 jobs as record low interest rates are hobbling profit levels.

Morgan Stanley saw revenue fall 26% but beat expectations.

AMEX saw 4th quarter earnings rise 12% as cardholder spending continued to rise.

However, the most promising results were those on Bank of America who brought in a profit of $1.99bln, 15 cents per share, compared to a prior 4th quarter loss of 16 cents per share.

Thursday saw the Tech giants come in all with gains but with differing success opinion.

Google reported a rise of 6% in earnings but missed targets.

Microsoft conveyed an increase in Q2 revenue, $20.1bln, but a slight decrease in net income.

IBM stated modest gains in both revenue and profit with the former up 2%.

In non-reporting news, Yahoo’s cofounder Jerry Yang resigned and Eastman Kodak filed for $950mn bankruptcy protection with their inability to keep up with global innovation cited as the reason for their decline.

The share action was not just confined to the US. Carnival saw shares open up 20% lower Monday morning following the Concordia disaster.

The catastrophe is expected to cost the company around $90m in earnings this year. The retail sector saw more ends of year reports with ASOS and ABF coming in inline, Greene King and Burberry reported better like-for-like sales figures.

The Spread Betting Markets - The Coming Week:

Figures out this week see Euro Manufacturing and Flash services, GB Public Net Borrowing as well as retail sales from Canada out today.

Wednesday is data packed with German Business Climate, GB prelim GDP, American Pending Home Sales and Crude Oil Inventories.

Thursday sees the weekly American unemployment claims and New Home Sales. Friday sees US advanced quarterly GDP.

Companies reporting next week include Renishaw, WH Smith, Misys and Anglo American.

A heavy week of statements coming out of America with smaller consumer banks, Caterpiller, Eastman Kodak and AT&T to name a few reporting.

Spread betting is a leveraged product. It carries a high level of risk to your capital and, as it is possible to lose more than your initial investment, it may not be suitable for all investors. Therefore, ensure you understand the risks involved and seek independent advice if necessary. The tax treatment of spread bets may be subject to change in the future.

Article by Spreadex

The above should not be construed in any circumstances as a recommendation or offer to sell or recommendation or solicitation of any offer to buy any security or other financial instrument.

On Saturday the representatives of Greece’s private creditors left Athens with no agreement being reached. It is reported that they are not willing to countenance any more than a 65%-70% loss on the current value of Greek bonds, which in any case will unlikely be anywhere near enough to tackle Greece’s rising debts.

Let’s not forget that we started out at a 21% haircut at last July’s EU summit and the number has kept going up, at the same rate that Greece’s economy has been spiralling down.

It remains unlikely that a deal will be reached by the end of today’s EU finance minister’s summit, as originally hoped.

Even so Greek officials remain confident that a deal can be reached by the next EU summit on 30th January but time is short, given the deadline of a €14.5bn bond repayment in March.

With fears of an imminent default continuing to rise in the event of no agreement, there is also the matter of Greece’s failing finances.

The troika report on deficit reduction is once again expected to show that the Greek government is behind the curve on that. The likelihood is that the troika could well ask that the Greek government implements further austerity measures in exchange for the next €130bn bailout.

With the Greek economy already getting crushed under the weight of fiscal austerity any call for further cuts could well be the straw that breaks the camels back.

In addition to discussing the second Greek bailout, today’s Eurogroup finance ministers meeting is set to make further tweaks to the fiscal compact agreed on the 9th December.

Last weeks downgrade of Italian and Spanish GDP growth by the IMF, with deep recessions predicted in both, has seen the leaders of both countries look to increase the pressure on Germany and the ECB.

Both leaders have requested a drop in their opposition to an increase to the new (ESM) European Stability Mechanism, as well as full scale QE and steps towards full scale fiscal union, a call so far fiercely resisted by both parties.

What Germany can’t avoid though is that after this month’s European downgrades its role is set to become even more crucial for the future of the European currency.

As the largest triple “A” country left in Europe further pressure is unlikely to diminish and it will become a matter of when and not if, that the Germans will have to decide whether or not they want to continue to pay the price for the survival of the euro.

France and Germany will both hold short term bond auctions today with Germany expected to tender €3bn in 12 month bills. France will also hold an auction of €4.5bn 13 week, €1.6bn 24 week and €2.2bn 50 week treasury bills.

EURUSD

 
The failure to get through the 1.3000 level has seen the single currency slip back sharply. Only above 1.3000 argues for 1.3250 and an even sharper squeeze.

If we move back below the 1.2850/60 area, then we’re back looking at a retest of the lows just above 1.2600.

The key support remains near to the key 1.2600 level that represents the 76.4% retracement of the up move from the 2010 lows at 1.1880 to last years highs at 1.4940. This support level also coincides with the August 2010 lows at 1.2590.

A concerted break below this level would target 1.2480, the July 2010 lows and then on to 1.2000. The key barrier on the upside remains the resistance around the 1.2870/80 or last weeks highs.

GBPUSD

 
The pound closed last week finally hitting the 1.5570 area, after breaking the 1.5500 area. The 1.5500 area should now act as support on any move back lower, which if broken, could see a move back to 1.5360.

While below the 55 day MA at 1.5740 pressure remains on the downside.

The 1.5270 support area remains a key level and obstacle to further sterling declines towards the 1.5190 level, which remains a key support area given that it is 61.8% retracement of the 1.4230/1.6745 up move.

There is also support at 1.5125, the July 2010 lows, a break of which targets 1.4980.

EURGBP

 
Last week’s failure at the 0.8370/80 area saw the trend line resistance do its job and keeps the focus firmly on the downside, especially now we have broken back below the 0.8310 level which keeps the focus back towards the lows at 0.8220 from two weeks ago.

This keeps the focus on the September 2010 lows at 0.8200/05, which remain the key obstacle to further declines towards the 2010 lows at 0.8065.

USDJPY

 
The USD/JPY continues to find support above the 76.50 area trading steadily above this level. The resistance remains at the confluence of the 55 day MA at 77.55 and trend line resistance at 77.70 from the 2007 highs at 124.15.

The key support remains around the November 2011 lows at 76.50 which prompted last week’s pullback. Only a move and close below 76.50 opens up the all-time lows at 75.30.

Equity market calls

 
FTSE 100 is expected to open 22 points higher at 5,752.

DAX is expected to open 13 points higher at 6,417.

CAC40 is expected to open 8 points higher at 3,329.

FTSEMib is expected to open 36 points higher at 15,668.

 
 
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Spread Betting, FX and CFD comments by Michael Hewson, Market Analyst, CMC Markets.

The above should not be construed in any circumstances as a recommendation or offer to sell or recommendation or solicitation of any offer to buy any security or other financial instrument.

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