ADVFN III World Daily Markets Bulletin (December 12th, 2012).

ADVFN III	World Daily Markets Bulletin
Daily world financial news

US Market

Stocks Seeing Modest Strength Amid Optimism About Fed Extending a recent upward trend, stocks are seeing modest strength in early trading on Wednesday. The major averages are seeing further upside after ending the previous session at their best closing levels in well over a month. The major averages have pulled back off their highs for the young session but are holding on to modest gains. The Dow is up 35.86 points or 0.3 percent at 13,284.30, the Nasdaq is up 6.73 points or 0.2 percent at 3,029.03 and the S&P 500 is up 4.40 points or 0.3 percent at 1,432.24. The early strength on Wall Street comes amid optimism about the likelihood of further stimulus from the Federal Reserve, with the central bank due to make a monetary policy announcement later this afternoon. Many analysts expect the Fed to announce a new round of Treasury securities purchases to replace its "Operation Twist" program, which expires at the end of the year. Peter Boockvar, managing director at Miller Tabak, said, "We'll hear again from the 4th branch of government today, the Federal Reserve, to tell us their plan to replace the upcoming expiration of Smother the Yield Curve." "Between Fed speeches and WSJ articles, it seems likely that we'll get $45 billion per month of unsterilized Treasury purchases, thus bringing the monthly dose of electronically printed money to $85 billion including the ongoing MBS program." Nonetheless, buying interest has remained relatively subdued ahead of the announcement, with traders reluctant to make any significant moves. Trading are keeping an eye on developments in Washington, as lawmakers continue to struggle to reach an agreement to avoid the looming fiscal cliff. Despite reports of progress in talks between the White House and House Speaker John Boehner, R-Ohio, Senate Majority Leader Harry Reid, D-Nev., said Tuesday it would be "extremely difficult" to reach an agreement before Christmas. While many of the major sectors are showing only modest moves, considerable strength has emerged among gold stocks, which are benefiting from an increase by the price of gold. The NYSE Arca Gold Bugs Index has advanced by 1.4 percent. Health insurance and banking stocks are also seeing early strength, while modest weakness is visible among electronic storage and commercial real estate stocks. In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Wednesday. Japan's Nikkei 225 Index rose by 0.6 percent, while Hong Kong's Hang Seng Index advanced by 0.8 percent. Meanwhile, the major European markets are turning in a mixed performance on the day. While the French CAC 40 Index has edged down by 0.1 percent, the U.K.'s FTSE 100 Index is up by 0.2 percent and the German DAX Index is up by 0.3 percent. In the bond market, treasuries are seeing modest weakness ahead of the Fed announcement. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 1.2 basis points at 1.661 percent. Canadian Market CADUSD Oil Gold Allbanc Please click on the images to view our interactive charts TSX Jumps At Open Wednesday Bay Street stock moved up at open Wednesday amid buying in material stocks, with the S&P/TSX Composite Index adding 41.18 points or 0.34 percent to 12,323.53. The Global Gold Index rose over 1 percent, with Royal Gold, Agnico-Eagle Mines, Allied Nevada Gold and Barrick Gold adding around 1 percent each. In the oil patch, Paramount Resources, Imperial Oil and Baytex Energy Corp. gathered around 1 percent each. Fertilizer maker Potash Corp. added nearly 1 percent and Agrium Inc. edged up 0.25 percent. YM BioSciences Inc. skyrocketed over 70 percent after Gilead Sciences Inc. (GILD) said it would acquire the drug development company for $2.95 per share cash. Meanwhile, Cenovus Energy lost over 2 percent after it guided that it would increase its oil output by 14 percent next year as it hikes output at its oil sands project in northern Alberta. The price of crude oil was moving higher Wednesday morning as traders await cues from the outcome of the two-day FOMC meeting and the official crude oil inventories data from the EIA. Analysts expect crude oil inventories to dip by 2.50 million barrels last week. Earlier today the International Energy Agency, in its monthly oil report, forecasts a sluggish demand growth through 2013, as global economic expansion remains tepid. However, it nudged up fourth quarter 2012 demand forecast following stronger-than-expected October preliminary demand data and signs of improving Chinese sentiment. Crude for January added $0.51 to $86.30 a barrel. The price of gold was moving higher Wednesday morning, with the U.S. dollar ticking lower ahead of the outcome of the two-day FOMC meeting, due out later today. Gold for February gained $8.60 to $1,718.20 an ounce. European Market FTSE 100 Euronext Dax perf CAC 40 Please click on the images to view our interactive charts European Markets Advance On Fed Optimism The European markets are mostly higher on Wednesday, as the two-day policy meeting of the U.S. Federal Reserve, which is underway, gave hopes of more stimulus. The Asian markets closed higher on stimulus optimism. The Federal Reserve, at the end of the two-day meeting, is expected to announce more stimulus as Operation Twist is set to expire after 2012. The Fed will also publish its forecasts for economic growth, unemployment, inflation and interest rates. Industrial production in Eurozone declined for a second consecutive month in October, but at a slower pace compared to the previous month, data released by Eurostat showed. Production dropped 1.4 percent in October after a 2.3 percent fall in September. Economists expected no change in production volume. U.K.'s claimant count dropped by 3,000 month-on-month to 1.58 million in November, the Office for National Statistics said. Economists had forecast it to rise by 7,000. At the same time, the claimant count rate held steady at 4.8 percent as widely expected for November. North Korea successfully launched a satellite carrying rocket early Wednesday, which the West and several other countries believe was aimed at testing a long-range missile. The U.S., Japan and South Korea have called for a meeting of the U.N. Security Council to discuss North Korea's defiance in launching the rocket despite the international community's request to desist from the move. The Euro Stoxx 50 index of eurozone bluechip stocks is losing 0.05 percent, while the Stoxx Europe 50 index, which includes some major U.K. companies, is gaining 0.15 percent. The German DAX is adding 0.3 percent, while Switzerland's SMI and the UK's FTSE 100 are gaining 0.2 percent each. The French CAC 40 is down 0.1 percent. In Frankfurt, ThyssenKrupp is gaining 3.9 percent. Jefferies raised the stock to ''Buy'' from ''Hold.'' Lufthansa is rising 2.8 percent. The airline on Tuesday reported a 1.3 percent decline in passengers flown in November. Capacity for the month declined 2.4 percent, while passenger load factor rose 1.4 percentage points. The company noted that the pricing environment remained positive. Commerzbank is notably higher while Deutsche Bank is moderately down. Credit Suisse downgraded EON and RWE. EON is modestly up while RWE is moderately lower. Fraport is losing 0.2 percent. The owner and operator of Germany's Frankfurt Airport reported a drop in passengers served and aircraft movements at Frankfurt Airport for the month of November. In Paris, Utility EDF is falling 2.1 percent and hotel group Accor is losing 1.2 percent. Luxury group LVMH is down 1.1 percent. Lenders BNP Paribas, Credit Agricole and Societe Generale are in positive territory. Cap Gemini is up 2 percent and France Telecom is gaining 1.4 percent. In London, Polymetal International is gaining 3.4 percent and Evraz is rising 3.1 percent. Anglo American is gaining 2.1 percent. Barclays raised the stock to ''Equal Weight'' from ''Underweight.'' BP is rising 0.6 percent. Russia's Rosneft signed an agreement to purchase 50 percent stake in TNK-BP from the AAR Consortium. Senior Plc is adding 3.3 percent after issuing a trading update. On the losing side is hotel and restaurant group Whitbread, which is falling 1.4 percent. Imagination Technologies is declining 4.4 percent after reporting first-half results. Inditex is losing 0.5 percent in Madrid. The fashion retailer reported a 27 percent rise in profit for the nine-month period, helped by a double-digit growth in revenues and margin expansion. Deutsche Bank reduced its rating on Novartis. The stock is modestly up in Zurich. Across Asia/Pacific, Australia's All Ordinaries rose 0.2 percent and China's Shanghai Composite Index advanced 0.4 percent. Hong Kong's Hang Seng and Japan's Nikkei 225 climbed 0.8 percent and 0.6 percent, respectively. Asia Market Asian Stocks Mostly Higher On Fiscal Cliff Hopes Asian stocks ended mostly higher on Wednesday, as investors cheered reports of progress in U.S. budget negotiations and a stronger-than-expected German economic sentiment index reading. With Operation Twist set to expire after 2012, investors bet that the U.S. Federal Reserve will unveil further measures to buy more Treasury bonds in an attempt to push down long-term interest rates and stimulate the world's largest economy. Japanese shares rose to a 7-month high, boosted by the yen' weakness against both the dollar and the euro ahead of major events at home and abroad. Export-linked shares paced the gainers, with Canon, Nikon and TDK gaining about 3 percent each as upbeat German business confidence figures spurred hopes of recovery in Europe's troubled economies. News of North Korea's rocket launch had little impact on the market. The Nikkei average rose 0.6 percent to its highest level in more than seven months, while the broader Topix index added 0.7 percent. Mitsubishi Motors soared over 10 percent on a Nikkei report that it would stop making cars in Europe with the aim of improving its operating profit. Panasonic jumped 7.2 percent following reports that it may sell its Sanyo digital camera business to private equity fund Advantage Partners as early as March. The Nikkei has climbed nearly 10 percent in the past three weeks on expectations that the Bank of Japan will adopt aggressive monetary easing to weaken the yen and reach the 2 percent inflation target if the Liberal Democratic Party returns to power as a result of the December 16 general election. The BOJ policy meeting is scheduled three days after the election. The main opposition LDP came out on top in an opinion poll released last week by Japan's largest daily, the Yomiuri Shimbun. On the macroeconomic front, data released by the Cabinet Office showed that core machine orders in Japan rose a seasonally adjusted 2.6 percent in October from the previous month, falling shy of forecasts for an increase of 3.0 percent following the 4.3 percent contraction in September. On a yearly basis, core machine orders collected 1.2 percent versus forecasts for a contraction of 5.0 percent. Australian shares rose to a 17-month high, led by miners following strong cues from overseas markets. Both the benchmark S&P/ASX 200 and the broader All Ordinaries index gained about 0.2 percent each encouraged by signs of robust demand for commodities in China and expectations of fresh U.S. economic stimulus measures. Global miner BHP added a percent after it agreed to sell its stake in the Browse liquefied natural gas project to Chinese state-owned energy producer PetroChina for $1.63 billion. Rival Rio Tinto added 0.7 percent, while oil & gas producer Woodside Petroleum advanced 1.6 percent. Banks ended on a subdued note on concerns about American legislation known as the Foreign Account Tax Compliance Act. Commonwealth and NAB ended down about 0.2 percent each, while Westpac slipped 0.4 percent and ANZ shed 0.8 percent. Linc Energy soared 25 percent on renewed speculation that Russian billionaire Roman Abramovich is interested in the company. Shares of Macmahon Holdings were in a trading halt after the company said it is considering withdrawing from the construction business and tapping investors for raising 80.7 million Australian dollars through a share issue. South Korea's Kospi average ended 0.6 percent higher, as investors shrugged off North Korea's rocket launch and pinned hopes on more economic stimulus from the Federal Reserve. South Korea today joined the United States and Japan in calling for a meeting of the U.N. Security Council to discuss North Korea's defiance in launching a long-range rocket despite the international community's request to desist from the move, South Korean media reported. "We will discuss the North's long-range missile launch at the Security Council with the aim of reaching a consensus on adopting tougher sanctions against North Korea," the Yonhap news agency quoted a South Korean Foreign Ministry official as saying. Meanwhile, S&P said it does not expect North Korea's rocket launch to exert a material negative impact on the sovereign ratings on the Republic of Korea. New Zealand shares fell notably, dragged down by heavyweights Telecom, Contact Energy and Fletcher Building, as investors took some profits off the table following sharp gains this year. Shares of the country's biggest phone company, utility Contact Energy and the nation's largest construction company all fell about 2 percent each, while the benchmark NZX-50 index shed 0.8 percent. Retailer Warehouse Group, the biggest retailer on the exchange, lost 2.3 percent, extending its slide to the lowest level since September 28 after it decided to buy appliance and consumer electronics chain Noel Leeming for $65 million from Gresham Private Equity. Exporter Fisher & Paykel Healthcare retreated 1.9 percent, taking cues from a high kiwi dollar, while retailers Kathmandu Holdings, Michael Hill International and Pumpkin Patch rose between half a percent and 4.5 percent on hopes of strong Christmas sales. China's Shanghai Composite index rose 0.4 percent and Hong Kong's Hang Seng index added 0.8 percent on optimism over budget talks in Washington. India's benchmark Sensex was moving down 0.2 percent as strong IIP data diminished chances of a rate cut at the upcoming monetary policy meeting next week. The markets in Indonesia, Malaysia, Singapore and Taiwan are up between half a percent and 1 percent. Commodities USDCAD USDEUR USDGBP USDJPY Please click on the images to view our interactive charts Crude Up Ahead Of Inventories Data, FOMC The price of crude oil was moving higher Wednesday morning as traders await cues from the outcome of the two-day FOMC meeting and the official crude oil inventories data from the EIA. Earlier today the International Energy Agency, in its monthly oil report, forecasts a sluggish demand growth through 2013, as global economic expansion remains tepid. However, it nudged up fourth quarter 2012 demand forecast following stronger-than-expected October preliminary demand data and signs of improving Chinese sentiment. Light Sweet Crude Oil (WTI) futures for January delivery, gained $0.43 to $86.22 a barrel. Yesterday, oil recovered from its three-week low to settle marginally higher after the OPEC held its 2013 world oil demand at 0.80 mbd and noted that the US oil demand moved from deep contraction to minor growth in the third quarter of 2012. Tuesday after the trading hours, the API said US crude oil inventories increased by 4.27 million barrels and gasoline stocks added 2.76 million barrels in the weekended December 07. The price of gold was moving higher Wednesday morning, with the U.S. dollar ticking lower ahead of the outcome of the two-day FOMC meeting, due out later today. Gold for February delivery, the most actively traded contract, added $5.30 to $1,714.90 an ounce. Yesterday, gold ended marginally lower as the U.S. dollar was mixed ahead of the outcome of a two-day Fed meeting. Holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, eased to 1,351.42 tons from a record high of 1,353.35 tons. This morning, the U.S. dollar was retreating from its 2-week high versus the euro and slipped back to a 5-week low against sterling. The buck was trading near its 7-month high versus the yen and ticking lower against the Swiss franc. In economic news from the euro zone, industrial production declined for a second consecutive month in October, but at a slower pace compared to the previous month, data released by Eurostat showed. Production dropped 1.4 percent month-on-month in October after a 2.3 percent fall in September. Economists expected no change in production volume.