Asia Rallies, Western Markets end Mixed

Asian markets advanced on Friday, shrugging off a weak PMI report from China. The Nikkei rallied 1.5% to 8766, and the Kospi surged 1.8%, both settling at their highest close in months. The Shanghai Composite climbed 1% to 2319, and the Hang Seng gained .8% to 20110, reaching a 3.5 month high as it crossed back above the 20000 mark. Australia’s ASX 200 lagged slightly behind, rising .6%.

In Europe, stocks closed slightly lower, but closed higher for the week. The FTSE, DAX, and CAC40 all eased .2%,

US stocks ended mixed as investors reacted to a heavy dose of earnings news. The Dow rallied 97 points to 12720, the S&P 500 gained .1%, while the Nasdaq closed down fractionally. The VIX tumbled 8% to 18.28.



Currencies

The Pound advanced .6% to 1.5574, thanks to upbeat retails sales data which showed a gain of .6%, after last month’s .5% decline. The Australian Dollar rallied .7% to 1.0494. The Euro slipped .3% to 1.2935, settling in the middle of its daily range, while the Yen ticked up .1% to 77.03.

Economic Outlook

Existing home sales rose by 5% to an annualized rate of 4.61M, up from last month’s 4.39M reading, but fell slightly short of analyst forecasts.

Dollar Slips on Greek Debt Hopes

Equities

Many Asian markets were closed on Monday for the Lunar New Year. In Japan, the Nikkei closed flat at 8766, and Australia’s ASX 200 slipped .3% as miners fell.

European markets advanced on news that Greece was close to reaching a deal with debt holders. The FTSE climbed .9%, while the CAC40 and DAX gained .5%. The European banking index surged 3.9% amid rumors that France and Germany were calling for a relaxation of capital requirements.

US markets closed mixed in light trading. The Dow and Nasdaq declined .1%, while the S&P 500 edged up fractionally.

Currencies

The Euro crossed back above 1.30 to 1.3031, up .7% amid hopes for a Greece debt deal. Similarly, the Swiss Franc gained .8% to 1.0792. Both the Australian and Canadian Dollar rose .5%, while the Yen and Pound settle little changed.

Economic Outlook

Tuesday’s lone report is the Richmond manufacturing index, which is expected to rise from 3 to 6. The Fed will begin their 2-day meeting on Tuesday.

European Officials Reject Greek Debt Deal

Equities

In Asia, markets in Korea, China, and Hong Kong remained closed for the Lunar New Year. The Nikkei rose .3% to 8985, as Elpida Memory soared 4% on hopes for a successful merger with Micron Technology. The ASX 200 closed flat, surrendering earlier gains.

European shares declined as hopes for a Greek debt deal began to fade, after finance ministers rejected an offer from private debt holders. The FTSE and CAC40 fell .5%, and the DAX eased .3%, despite an upbeat PMI report which rose to its highest level in 4 months.

In the US, the major indexes closed mixed. The S&P 500 snapped its 5-day winning streak, slipping .1%, while the Dow ticked down 33 points to 12676. The Nasdaq posted a modest .1% rise.

Currencies

The Dollar traded mixed against world currencies, as traders paid little mind to the disappointing news from Greece. The Yen slumped 1% to 77.72 against the dollar, and the Australian dollar declined d.5% to 1.0477, while the Pound rose .3% to 1.5616. The Euro inched up 7 pips to 1.3026, and the Canadian Dollar edged up .1% to 1.0100.

Economic Outlook

The Richmond manufacturing index blew past forecasts, surging to 12 from last month’s reading of 3. Analysts had expected the index to rise to 6.

Fed Pledges to Keep Rates Steady Until 2014

Equities

Outstanding earnings from Apple on Tuesday evening helped propel Asian markets higher on Wednesday. The Nikkei rallied 1.1% to 8840, as a drop in the Yen boosted exporters such as Sony, which surged 4.8%. The ASX 200 climbed 1.1%, and the Kospi inched up .1%. Markets in China and Hong Kong remained closed for the Lunar New Year.

Concerns over Greek’s debt situation pressured European banks, sending the FTSE down .5% and the CAC40 down .3%. Nonetheless the DAX managed a slight gain. The European mobile sector fell after Ericsson missed profit forecasts.

US stocks advanced in the afternoon, thanks to a commitment from the Fed not to raise interest rates for at least 2 years. Tech shares led the advance, as the Nasdaq gained 1.1% to 2818. The Dow rose 83 points to 12759, and the S&P 500 closed up .9%.

Currencies

The Australian Dollar jumped 1.2% to 1.0606, as the US Dollar fell against its peers. The Euro and Canadian Dollar both rose .6% to 1.3115 and 1.0039 respectively, and the Pound gained .3% to 1.5670. The Yen eased fractionally to settle at 77.72, and the Swiss Franc advanced .7% to 1.0858.

Economic Outlook

Pending home sales fell 3.5% in December, following November’s 7.3% advance. On the plus side, the OFHEO home price index rose by 1%, more than expected.

European Shares Rally on Hopes for Greek Debt Plan

Equities

Asian markets traded mostly higher, encouraged by the Fed’s commitment to keep interest rates unchanged through 2014. The Hang Seng soared 1.6% as Hong Kong’s markets returned from the Lunar New Year Holiday, although volume was light, since China’s markets will remain shut until Monday. The Kospi edged up .3% despite weak 4th quarter GDP data. Meanwhile, the Nikkei skidded .4% to 8849, and markets in Australia were closed

European markets posted strong gains on hopes that Greek debt negotiations were progressing. The DAX surged 1.8%, the CAC40 climbed 1.5%, and the FTSE gained 1.3%. Shares in retailer, Carrefour, jumped 7.5% on rumors of a change in management, and Nokia shares rallied 3.1% on strong earnings data.



Germany's DAX Jumps 1.8%

US stocks pared early gains to close lower. The Dow slipped 22 points to 12735, the Nasdaq dropped .5%, and the S&P 500 fell .6%.

Currencies

Currencies traded in narrow ranges, as the dollar fell modestly. The Australian dollar, Japanese Yen, and Canadian dollar all gained .3%, and the Pound edged up .2% to 1.5691. The Euro inched up 6 pips to 1.3106, while the Swiss Franc rose .2% to 1.0865.

Economic Outlook

Thursday’s economic data was mixed. Weekly jobless claims were 6K more than expected, rising to 371K from last week’s 351K reading, and new home sales fell to 307K from last month’s 314K. On the bright side, durable goods orders rose 2.1%,, and core durable goods order jumped by 3%, both better than forecast.