EU Morning Report - Euro Bank Stress Tests Released!
•The USD continued to struggle in the 'risk on' environment with US stocks extending the week's gains to over 4%. The release of the EU bank stress results did not fault the good mood with most of the action seen in the hours beforehand. In US stocks.
•The Euro was sharply lower in Europe on concerns the Bank stress tests were not tough enough. Helping support though was the release of strong German July IFO at 106 vs. 101 forecast. When the release of the bank stress tests caused little alarm (7/91 failed) and US stocks rallied the Euro was bought up back above 1.2900. EUR/USD traded with a low of 1.2794 and a high of 1.2967 before closing at 1.2909.
•The Sterling had a very strong day on the back of surprisingly strong Q2 GDP figures. Expectations were poor after the Greece Debt Crisis in May but the figures of 1.1% vs. 0.6% forecast were well received. EUR/GBP dropped below 0.8400 and Cable broke to near month highs above 1.5400. Overall the GBP/USD traded with a low of 1.5255 and a high of 1.5449 before closing the day at 1.5420 in the New York session.
•Gold Fell back after failing to hold above the $1200 level but found support at under $1190 to finish in familiar territory. Overall trading with a low of USD$1200 and high of USD $1185 before ending the New York session at USD$1190 an ounce.
Currency to watch out for: EURUSD & USDJPY
•The EURUSD pivot point is at 1.2860 with a preference to enter into Long positions at 1.2860
•The GBPUSD pivot point is at 1.5345 with a preference to enter Long positions 1.5345
Today's calendar and market movers:
•US New Home Sales expected at 0.31 million
Equity Markets:
•US equities closed positive on Friday with the DJIA and the SP500 closing 0.99%% and 0.82% respectively. The European bourses were mixed with the FTSE closing -0.02% the DAX and the CAC closing up at 0.39% and 0.18%. The NIKKEI and the HSI at the time of writing is 0.72% and 0.21% respectively.
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