The US debt ceiling issues have taken over market headlines and have collapsed sentiment despite better than expected earnings from many financial and technology firms. Despite lackluster earnings from Goldman Sachs, Morgan Stanley performed much better than expected.
Morgan Stanley swung to a loss of $558 million (38 cents per diluted share) in the quarter. MS beat the mean analyst estimate of a loss of 63 cents per share. It beat the average revenue estimate of $8.04 billion. The investment brokerage had net income of $1.96 billion or $1.09 per share in the year earlier quarter. Revenue: Revenue was $9.28 billion last quarter. Continue reading
Canada’s dollar touched the highest level against the dollar in more than three years at the end of last week, as investors took Bank of Canada statements to mean the central bank may become more hawkish with interest-rate increases. The BOC targets inflation, which is beginning to advance to a higher than expected level. Continue reading
The outcome of the euro zone summit as well as the US fiscal impasse and Q2 earnings are likely to remain the week’s dominant drivers. Over the past few weeks the euro has been plagued about uncertainties over the involvement of private bondholders in the Greek bailout, which has led to tensions in some of the other non-core bond markets –namely, Italy and Spain. In terms of the details of the Greek bailout deal, investors are likely to expect an increase in the Greek financial rescue package, along with more clarity on the role of private sector involvement. Continue reading
Noble Energy is enjoying upside momentum in crude oil as well as other names in the oil/gas space after BHP made a bid for Petrohawk (HK). The upstream oil and gas producers is ripe as a takeover target which should add to momentum on a break of the 92.60 high. There is resistance again at 94, and then again at 97. This is a short term trade, and a trader needs to be nibble. Continue reading
Given the current economic uncertainty, the Federal Reserve is prepared to stimulate the economy to improve growth and employment. In the backdrop of a fight on the debt ceiling Ben Bernanke inflated markets as investors rushed to purchase hard assets. Continue reading
The currency markets have started the week were they left off concentration on defensive positions, and selling the Euro. The focus has now move to Italy, were bond markets are very defensive.
Ratings actions on Italy are likely in the coming weeks. Moody’s put its Aa2 rating on Italy on review for a possible downgrade. While Italy is considered part of the periphery, it has shown remarkable stability in its credit standing and remained at the A+/A1/A+ level during much of the crisis. Continue reading
The rebound in the US economy from the recently dubbed soft patch has been quick, and the markets are beginning to price in higher prices for riskier assets such as US equities. Lower gasoline prices in the month of June, quickly created a pickup in retail purchases, driving up prices on retail companies, which have had a positive effect on overall sentiment. Continue reading
Facebook said it is integrating Skype video chat into its social network, a move that mirrors a similar function rolled out by competitor Google Inc. last week as part of its new social service. The new feature, which will come as part of a revamp of the company’s website chatting feature, will use technology from Skype, a pioneer in Web-based video chatting. Continue reading
Ben Bernanke has been adamant in his stance that inflation is transitory and will eventually move back toward the long term historical norm. Since he began to preach this motto, prices of oil, grains and precious metals have reversed from 2011 and all time highs, and moved back toward support levels as market participants await new information to determine the next direction for commodities.
Silver prices, topped out near $50 dollars per ounce, and continued to remain in a relatively tight range between $32 dollars per ounce and $39 dollar per ounce. Inflation expectations have moved lower as the demand for commodities from large economies such as the US, Japan and China has loosened. The Chinese have been tightening rates, Japan is recovering from a natural and nuclear disaster and the US is dealing with a slow recovery after the worst recession since the Great Depression.
Inflation expectations in the form of TIPS (treasury inflation protected securities) are reflecting inflation expectations of less than 2% on a year over year basis. With this in mind, the prices of precious metals could be considered lofty. With silver in a tight range, a break to either side will likely generate momentum in the direction of the break out.
A close below the horizontal trend line of 32.32, will likely lead to a test of the $30 dollar level.
The trade – purchase a daily binary option put on silver on a daily close below 32.30.
Asset : Silver
The trade : Binary Put Option
Expiry time : End of day
When : On a daily close below 32.30 .