ZT:
the investing environment lifting force is steady, but not steep, but the absence of a material increase in selling pressure is consistent with the notion of a gradual bull market, not a sharp selloff some of have feared.
Germany’s constitutional court ruled on the nation’s ratification of the European Union’s E500 billion rescue fund, with certain conditions attached, a decision that, although expected, still permitted a sigh of relief in the markets, lifting the euro, German bunds and European banking shares while driving Spanish and Italian bond yields and the US dollar lower. The day still contains elements of euro event risk, such as considerations of European Commission President Barroso’s detailed proposal for a banking union with a single supervisory mechanism that still must be approved by individual member states. The Dutch are casting their votes for leadership change that raises the risks of additional austerity demands. However, for this market’s moment it appears a firewall may have been established that can withstand the pressure of contagion risks and contain fears of financial instability and euro collapse.
Outside matters of eurozone consideration, monetary actions remain at the forefront. The Fed begins its two-day policy meeting today, with the interest rate decision slated for tomorrow at 12:30 PM EDT, followed by FOMC forecasts at 2:00 PM EDT and Fed Chairman Bernanke’s press conference at 2:15 PM EDT. Expectations for another round of quantitative easing have followed the flow of incoming data, which has gone from worrisome to surprisingly resilient to a now more troublesome brew of weak employment gains and soft manufacturing data alongside surprisingly robust consumer spending and confidence. And yet Chairman Bernanke has remained steadfast in adhering to the Fed’s mandate to keep employment levels strong, and in this case to boost hiring that remains ‘frustratingly” weak and a “grave concern.” However, adversaries maintain any actions face a law of diminishing returns, with little advantages expected while inflationary risks continue to grow. Claims of political maneuvering by the Fed remain a danger for an agency that considers itself above such things. Moreover, Bernanke may hold a “shock and awe” action of open-ended bond buying in abeyance until a true crisis unfolds, such as a deadlocked Congress, unable to negotiate its way back from the fiscal cliff. In short, Mr. Bernanke appears inclined to take some form of action, as well as to maintain his pledge to act should it become necessary, perhaps extending the forward guidance on interest rate levels. Last Friday’s woeful August jobs report has lifted strategists’ hopes for asset price lifting actions tomorrow, and the Chairman seemed easing-tilted during his Jackson Hole speech. He may find it difficult to reach a quorum of supporting Fed members, however.
China easing actions remain unclear, from an opaque government hierarchy currently undergoing its own major leadership change. Yesterday, however, markets took heart in Premier Wen Jiaboa’s assertion that China has the means and the willingness to stabilize the nation’s slowing economy. He also averred Beijing’s growth target of 7.5% for this year will be met. Such assurances helped Asian markets today to close broadly higher. Japan’s Nikkei led the region with 1.7% gains, as investors there bet on intervention in forex markets to curb the rising yen. The US dollar is trading up 0.1% against the yen currently. Hong Kong’s Hang Seng added 1.1% and Australia’s S&P/ASX 200 added 0.8%. Lagging the region’s moves, China’s Shanghai Composite rose a modest, 0.3%.
发表于 2012-9-12 21:58
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发表于 2012-9-12 22:01
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发表于 2012-9-12 22:03
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