Shares Spread Trading: ASML Holdings Stocks Surge on Higher Q1 Order Forecasts
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For today's update see Spread Betting Daily.
The Daily Update from Anthony Grech, Research Analyst, IG Index.
Spread Betting 19 January 2011: 11.00am Update
Global shares spread betting retreated from their highest level in over two months this morning as investors turned cautious ahead of the second day of talks between Greece and it creditors. Meanwhile, market players await bond auctions by Spain and France later in the day.
By 10am (London time) the FTSE 100 was flat at 5701.17, while the FTSE 250 was 0.73% higher at 10,739.16.
Greece resumes talks with private creditors
Greece is to meet its private creditors for a second day of bargaining on a crucial bond swap deal, with time running out for reaching a compromise needed to avoid an unruly default.
Negotiations between Prime Minister Lucas Papademos and the head of the International Institute of Finance, Charles Dallara, which represents private bond holders, resumed yesterday after hitting an impasse last week.
The two sides must conjure up a deal within days to pave the way for Greece to receive a new infusion of aid and avoid bankruptcy when €14.5 billion of bond redemptions fall due in March.
The swap is aimed at cutting €100 billion off Greece's debt load by getting the private holders of Greek bonds to accept a 50% cut on their notional value.
The bond swap deal is vital for clinching Greece's second €130 billion rescue package, though speculation is growing that Greece may need further funds than it has already agreed to.
Kept afloat by its bailout loans, Greece also now faces the realistic prospect of leaving the Eurozone and slumping into further economic and social misery if it fails to secure a deal with the private bond holders.
Kodak files for bankruptcy protection
Kodak, inventors of the hand-held camera, filed for bankruptcy protection late last night, capping a prolonged plunge for one of America's best-known companies.
At the end of September 2011, the group had total assets of $5.1 billion and liabilities of $6.75 billion, while over the course of 15 years, the company has seen its market value rise to as much as $31 billion and fall to as low as $150 million.
The company has also obtained a $950 million 18-month credit facility from Citigroup as it scurries to find buyers for its 1100 digital patents, and to reshape its business while continuing to pay 17,000 workers.
Since 2007, Kodak has failed to restore annual profitability and has not been able to meet its substantial pension and other benefit obligations to its workers and retirees.
A missed opportunity which saw Kodak lose market share to its rivals was the development of the digital camera.
Kodak put the idea of a 'digital camera' on the back-burner for years and watched rivals develop model after model, effectively giving away market share.
Looking ahead
US March futures were flat this morning with Dow Jones futures 4 points lower at 12,500.00 and the S&P 500 down 0.20 points to 1302.00.
Looking ahead to this afternoon, the US economic data calendar is fairly busy with inflationary data, housing starts and weekly jobless claims due at 1.30pm. This is followed by consumer comfort readings at 2.45pm and the Philadelphia Fed survey at 3pm (all London time).
Remember that financial spread betting is a leveraged product and can result in losses that exceed your initial deposit. Spread betting may not be suitable for everyone, so please ensure that you fully understand the risks involved.
The above comments do not constitute investment advice and neither IG Index nor SpreadBets.org.uk accept any responsibility for any use that may be made of them.
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Spread Betting 19 January 2012: 6.00am Update
US markets extended their gains overnight on a slew of positive news. On the European front, investors cheered news that Greece resumed negotiations with bondholders, plus reports that the IMF is looking to expand its lending fund by as much as $500 billion in a bid to safeguard economic growth.
Some reports are suggesting the Greek government might have an agreement on a debt swap in the coming days.
In the US, Goldman Sachs earnings smashed expectations, bucking the negative trend in earnings reported by its financial peers. Investors also embraced improving home-builder confidence figures.
Among the major averages, the Dow Jones Industrial Average climbed 0.8% to close at 12,579. The S&P rose 1.1% to 1308 and the NASDAQ advanced 1.5% to 2770.
The tech stocks were a standout after ASML Holdings, Europe’s largest semi-conductor company, forecast higher first quarter orders and circuit maker Linear Technology Corp’s sales beat projections.
Asia & Australia
Across Asia, equity markets are trading higher after picking up positive leads from US markets.
They have rallied as investors cheered on news that Greece resumed negotiations with bondholders, plus reports that the IMF is looking to expand its lending fund by as much as $500 billion in a bid to safeguard economic growth.
Some analysts say a swift deal between Greek and private sector bond holders appears to be within reach. The Financial Times reported that greater flexibility on the terms of the bonds could be introduced, which would result in a satisfactory voluntary agreement.
The Nikkei is up 1.3%, the Hang Seng and Shanghai have climbed around 1% each and the ASX 200 is half a percent higher.
Asian markets have been supported all day on a mix of solid technical buying and supportive comments coming out of China, with authorities there showing they are fully behind supporting the economy and installing confidence into the markets.
A poor headline employment report has seen the Australian equity market underperform, however it hasn’t prevented the Australian dollar from heading to break downtrend resistance.
US & Europe
US shares are pointing to a relatively flat open as they consolidate after the overnight gains. European markets are pointing to a strong open as they did not have a chance to react to the gains seen on Wall Street.
Following last night’s strong move in US markets, there will probably still be a lot of longs in the system with traders hoping the current bullish momentum continues, particularly with the S&P closing significantly above 1300.
Earnings reports and a big round of economic data out tonight could be catalysts for further gains should they come in positively.
Goldman Sachs may have beaten expectations with the help of some handy cost cutting, however earnings reports come in thick and fast tonight with Morgan Stanley, IBM, Microsoft and American Express to name a few.
A heightened sense of an agreement on the Greek debt swap is keeping risk assets bid whilst a technical break of 1301 on the S&P is also supporting. Given the follow-through buying in Asia, it looks as though green on screen will be the order of the day in Europe.
A break of the October 27 high on the FTSE could come into play sooner rather than later, though the event risk could still very much come into play.
Data in Europe is relatively light. Once again, FX spread betting investors and equity traders will get their lead from the fixed income market, with Spain and France holding their first longer-dated bond auctions since the S&P downgrade in a backdrop of stabilisation in yields and the euro.
We have seen a good bid in the short-dated paper, but will investors be keen on taking longer term risk?
Ahead of the open we are calling the FTSE up 12 points at 5714, the DAX up 36 at 6391 and the CAC up 24 at 3289.
Remember that financial spread betting is a leveraged product and can result in losses that exceed your initial deposit. Spread betting may not be suitable for everyone, so please ensure that you fully understand the risks involved.
The above comments do not constitute investment advice and neither IG Index nor SpreadBets.org.uk accept any responsibility for any use that may be made of them.
Advert:
IG Index Spread Betting - No Fees, No Commissions, Free Charts and Live Prices.
Spread Bet on Indices, Forex, Commodities, Shares and more. For details see IG Index.
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"Shares Spread Trading: ASML Holdings Stocks Surge on Higher Q1 Order Forecasts" last update by AG, 19-Jan-2012
Warning: Financial spread betting carries a high level of risk. You can lose more than your initial investment or stake. Financial spread betting may not be suitable for all investors. Only trade with money that you can afford to lose. Make sure you fully understand the risk involved. If necessary, seek independent financial advice.
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