Daily Commentary

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Daily FX Commentary: (Morning Report)

	EURUSD

Friday's break above 1.2650 dynamic projection unleashed an impulsive rise and current high at 1.2817 sets the beginning of a consolidation pattern, preceding next leg upwards, to 1.3000 resistance area. My intraday outlook is negative, for a slide towards 1.2720. Crucial support on the downside is 1.2650 break-out zone. USDJPY Current intraday bias is slightly positive after 78.00 low and I expect a minor rise for a test of 78.54 resistance area. The bias on the senior frames is negative for 77.60 low. GBPUSD Friday's sharp rise performed a precise test of 1.6040 resistance area and currently the intraday bias is negative, for a slide towards 1.5940 minor support, within the corrective pattern below 1.6040. The overall outlook remains positive above 1.5910, for a rise towards 1.6125 dynamic projection.

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Daily Market Commentary: (Evening Report)

London Market Report

London close: Stocks flat, markets in 'wait and see' mode
Market Movers

• techMARK 2,114.20 -0.12%
• FTSE 100 5,793.20 -0.03%
• FTSE 250 11,841.50 +0.28%

- Investors cautious ahead of pivotal week
- Ruling on ESM and FOMC meeting in focus
- Miners lead risers on hopes of QE3

London's FTSE 100 index finished just two points lower on Monday afternoon as investors refrained from building positions ahead of a busy week for the markets.

The Footsie stayed within a narrow range for most of the day with just 20 points between the intraday high and low.

"Markets have reverted to 'wait and see' mode today ahead of this week's key events out of Europe and the US as investors start to book some profits after the gains of the last few days," said market analyst Michael Hewson from CMC Markets.

Investors are awaiting the German Constitutional Court ruling on the European Stability Mechanism on Wednesday, while Thursday's focus will be on the Federal Open Market Committee meeting in the US, "both of which are major event risks", according to Ishaq Siddiqi from ETX Capital.

"Germany's opposition of the ECB's bond buying plan and the mixed data picture of the US economy prompt a huge degree of uncertainty over both events," he said.

Stocks were given a boost towards the end of last week after European Central Bank (ECB) President Mario Draghi unveiled details of the bank's bond-buying programme, which included unlimited and sterilised purchases of sovereign debt with maturities over between one and three years.

In other news, China reported significantly worse-than-expected import figures for August, falling for the first time in a non-holiday period since 2009. The trade surplus widened to $26.7bn last month, well above expectations of $19.5bn.

Meanwhile, Japan's Cabinet Office slashed its estimate of gross domestic product growth for the second quarter to an annualised rate of 0.7% (consensus: 1.0%), versus the preliminary estimate of 1.4%.

Europe Market Report 

Europe close: Markets slip on China fears
Greek PM meeting Eurozone officials on rescue programme
- China numbers worry markets
- Philips down after Goldman hit

FTSE 100: -0.03%
Dax 30: -0.01%
Stoxx 600: -0.22%
Cac 40: -0.37%
Ibex 35: -0.32%
FTSE MIB: -0.11%

European stocks retreated on Monday as investors cashed in on the big gains of the previous week.

Last Thursday equities got a big boost when the European Central Bank revealed plans to buy the debt of distressed euro area nations but investor attention has now turned to the strings the ECB will attach to any intervention in the bond market. Most observers would agree that the conditions imposed on Greece have been disastrous and no one wants a repeat if Spain and Italy ask for help.

Today the Greek Prime Minister Antonis Samaras has been meeting EU officials after he failed to win agreement from his coalition partners for the latest round of cuts demanded by the country's lenders.

Further darkening the mood have been disappointing numbers out of China where both the industrial production figure for August (+8.9%) and imports (-2.6%) came in below expectations. 



US Market Report

US open: Stocks start the week slightly lower -S&P 500 trading near 5 year average PE multiple -Apple may unveil iPhone 5 this week Dow Jones Industrial: -0.14% Nasdaq Comp.: -0.25% S&P 500: -0.08% The main US equity benchmarks are now trading slightly lower. That ahead of a weekly calendar brimming with potentially market-moving events and following weak data out in China and Japan overnight. For now however investors seem to be pausing ahead of this next Thursday's rate setting meeting of the US Federal Reserve. Traders are also closely watching events in Greece and Spain. Back on the corporate front, AIG is down after the US Treasury announced its intention to lower its stake in the former insurance giant to below 50%. Plains Exploration&Production will purchase $5.5bn in Gulf of Mexico assets from BP. Of interest, the S&P 500 is now changing hands at 13.9 times the expected earnings of its members, according to data compiled by Bloomberg. That's the highest since February 2011 and almost matches the average ratio since 2007 of 14. Goldman Sachs has cut its recommendation on shares of Wells Fargo to buy from Conviction buy. 10 year US Treasuries are now flat, with yields at 1.67%. Front month West Texas crude futures are declining by 0.85% to the 95,60 dollar per barrel mark on the NYMEX.