Daily Comment RR 28Jul11

8/6/2019 Daily Comment RR 28Jul11

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Daily CommentRaiffeisen RESEARCH

28 July 2011

Established markets:In the US debt dispute the proposals of boththe Democrats and the Republicans have been or are currentlybeing revised as according to calculations by the impartial Con-

gressional Budget Office neither of the plans would result in therespective publicised savings. Furthermore, the bill previously pre-sented by Speaker of the House of Representatives Boehner (Rep.)came in for criticism from his own party, which is why the votescheduled for yesterday was postponed until today. Nevertheless,behind the scenes a solution is being sought at the highest level.In the Eurozone yesterday S&P downgraded Greece from CCC toCCand was at the same time the last of the three rating agenciesto comment on the planned involvement of the private sector inthe second bailout package for Greece. According to the agency,the planned bond swap/rollover fulfils the conditions for a selec-tive default. The rating for Cypruswas also downgraded on theprevious day. Moodys cut the rating from A2 to Baa1, giving asreasons Cypriot banks exposure to Greece and a weaker growthoutlook, partly resulting from the ongoing energy shortage.On the primary markettoday Italyis planning to issue bonds withmedium to long maturities, which will be closely observed fol-lowing the increases in yields on Italian government bonds in thepreceding days.

Equity markets: Yesterdays news contained all the right ingre-dients for losses on the US equities markets: the political disputeconcerning the raising of the debt ceiling is worsening, the UnitedStates Aaa rating is more and more at risk, June durable goodsorders dropped by a surprisingly sharp rate and even the news

from companies was a good deal worse this time. Emerson Electric(down 6.7%) is suffering from more muted order receipts, whileJuniper Networks (down 20.9%) shocked the markets with a profitwarning. As a result, the US equities indices also slid by between

Hourly Q/SPc1 08:0026.07.2011- 08:0028.07.2011(CHG)

1.307,22

1.326,8438,2%

1.321,3461,8%

1.312,45100,0%

1.298,07161,8%

1.296,1838,2%

129314618%

1.296,1838,2%

129314618%

1.307,22

1.326,8438,2%

1.321,3461,8%

1.312,45100,0%

1.298,07161,8%

SMA;Q/SPc1;LastTrade(Open); 13;

01:0028.07.2011;1.302,41


01:0028.07.2011;1.302,41

Cndl;Q/SPc1;LastTrade

01:0028.07.2011;1.300,70;1.301,90;1.300,70;1.301,90


01:0028.07.2011;1.302,41


01:0028.07.2011;1.302,41

Cndl;Q/SPc1;LastTrade

01:0028.07.2011;1.300,70;1.301,90;1.300,70;1.301,90

Price

USD

.12

1.296

1.299

1.302

1.305

1.308

1.311

1.314

1.317

1.320

1.323

Price

USD

.12

1.296

1.299

1.302

1.305

1.308

1.311

1.314

1.317

1.320

1.323

0 8: 00 09 :0 0 1 1: 00 1 3: 00 1 5: 00 1 6: 00 1 8: 00 2 0: 00 2 2: 00 0 0: 00 0 2: 00 0 4: 00 0 6: 00 0 8: 00 0 9: 00 1 1: 00 1 3: 00 1 5: 00 1 6: 00 1 8: 00 2 0: 00 2 2: 00 0 0: 00 0 2: 00 0 4: 00 0 6: 00 0 8: 00

26 Juli 2011 27 Juli 2011 28 Juli 2011

Chart of the day

Source: Thomson Reuters, Raiffeisen RESEARCH

Market overviewcur. 1T 52W H 52W L Ytd

Interest rates, yields

3M Euribor EUR 1.61% -0.3 BP 1.6% 0.9% 60.6 BP

3M Libor USD 0.25% 0.0 BP 0.5% 0.2% -5.0 BP

Bund Future EUR 129.37 0.8% 134.8 119.9 3.2%

US T Note Future 124.39 0.1% 125.4 115.1 5.3%

Currencies

EUR/USD 1.437 0.0% 1.49 1.26 -7.3%

EUR/JPY 111.730 -0.4% 123.3 105.4 2.9%

EUR/CHF 1.151 -0.3% 1.4 1.1 -8.7%

EUR/CZK 24.256 0.0% 25.4 23.9 -3.1%

EUR/HUF 268.580 0.0% 289.6 261.9 -3.8%

EUR/PLN 4.023 0.0% 4.12 3.83 1.5%

Equity markets

S&P 500 1305 -2.0% 1371 1040 3.8%

Dow Jones I. A. 12303 -1.6% 12876 9937 6.3%

Nasdaq Comp. 2765 -2.6% 2888 2099 4.2%

DJ EuroStoxx 50 2694 -1.7% 3077 2560 -3.5%

DAX 7253 -1.3% 7600 5834 4.9%

ATX 2642 -1.4% 3013 2366 -9.0%

Nikkei 225 9896 -1.5% 10892 8228 -3.3%

Emerging Markets

Hang Seng (China) 12357 -1.8% 14219 11296 -2.6%

Sensex (India) 18245 -1.0% 21109 17296 -11.0%

Bovespa (Brazil) 58288 -1.8% 73103 58169 -15.9%

JALSH ( South A frica) 31594 -0.9% 33335 26432 -1.6%

Commodities

Brent Oil USD/bbl 118 0.2% 125 79 23.7%

Gold USD/oz 1615 0.1% 1628 1157 13.7%

Credit markets

iTRAXX Europe 107 3 BP 126 94 11 BP

ITRAXX Crossover 407 10 BP 531 352 -2 BP

iTRAXX Fin. Senior 173 6 BP 210 107 -5 BP5J CDS Greece. 1699 41 BP 2571 661 625 BP

5J CDS Spain 265 9 BP 301 121 -12 BP

5J CDS Portugal 958 17 BP 1131 184 536 BP

Prices as of 28 July 11, 80:00 a.m. (CET)Source: Bloomberg

S&P FutureLast: 1,301 Sell 1,297Target: 1,293 1,288Bearish consolidation, stop 1,306 -> 1,311.

July 28h, 2011 07:49 CET

Important indicators todayRBI Kons. zuletzt

USA16:00 Pending home sales, mom Jun n.a. -2.0% 8.2%

n.a. Colgate-Palmolive, Kellogg, Sprint Nextel,Starbucks, Exxon Mobil

Q2-figures

- - -

Europen.a. Deutsche Brse, BASF, Bayer, Credit Suisse,

France Telecom, Deutsche Lufthansa, MAN,Royal Dutch, Sanofi, Siemens, Telefonica,VW, Danone, Infineon

Q2-figures

- - -

09:55 GE: Unemployment, mom, thsd Jul -25 -13 -811:00 EUR: Economic confidence Jul 103.5 104.0 105.1

11:00 EUR: Industrial confidence Jul 2.4 2.0 3.2

Emerging Markets11:30 SA: PPI (MoM) Jun n.a 3.9% 0.4%

13:00 BZ: FGV Inflation IGP-M (MoM) Jul n.a. -0.1% -0.2%

Source: Bloomberg, Raiffeisen RESEARCH


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Daily Comment

1.6% and 2.7% yesterday evening, accompaniedby heightened volatility, while trading volumes rosein the face of declining stock prices. Taking its cuesfrom overseas conditions, the Japanese Nikkei 225indexdipped below 10,000 points this morning. Ac-cordingly, European boursesalso look set to open ona weaker note this morning. A plethora of corporatequarterly figures are due out today. At least some ofthem (Siemens, BASF) will not be able to alleviate theoverall muted sentiment.

Credit markets: The primary market for corporatebonds remains effectively closed. On the financialside it was announced that the planned participa-tion of the private sector in Greeces bailout is beingcoordinated by the following banks: HSBC, BNP Pa-ribas and Deutsche Bank . BNP Paribas is one of

the largest bank holders of Greek debt. Moodysyesterday reiterated that Danish banks refinancingcosts are likely to remain elevated owing to the toughinsolvency laws. Cypriot banks were downgraded asa result of Moodys downgrade of Cyprus (incl. se-nior unsecured rating for Marfin to Ba2 and for Bankof Cyprus to Ba1).

Emerging Markets:The stock markets in China andIndia are still clearly burdened today by the crisis inthe US. The IGP-M inflation rate in Brazil (its broadestmeasure of inflation) for the month of July will be pub-

lished today. The consensus anticipates a slight dropmonth-on-month. The central bank will also publishthe results of its meeting on interest rates today. An-nouncements by the government that it will introducea tax on certain FX derivatives caused the Brazilianreal to fall around 1.1% yesterday. In South Africa,the producer price index for the month of June will bepublished today; the forecast is a 6.9% p.a. changeyear-on-year.

CEE:There was no relevant data published yesterdayin the CEE; the region is still facing the enormous in-fluence of the uncertainties regarding the eurozone

periphery. Today will also be a quiet day in terms ofdata on CEE. In addition to Junes unemployment fi-gures for Hungary, which we forecast at 10.9% (for-merly 11.0%), the July business sentiment in Romaniawill be published. Furthermore, today is the day ofthe local currency bond auctions in Hungary, whichoccur every two weeks. 3yr, 5yr and 10yr bondswith a total volume of HUF 45 billion (about EUR167 million) are to be issued. Given the currentlygrowing uncertainty in the financial markets, weexpect the yields to have risen from their level twoweeks ago. Back then, they ranged from 6.64% for

the 2yr segment and 7.36% for 10yr bonds.

Market overviewcurrent 1T 52W H 52W L Ytd

Other interest ratesEUR

Eonia 0.95% -3.8 BP 1.7% 0.3% 13.6 BP





2Y Swap EUR 1.96% -0.1 BP 2.5% 1.1% 40.1 BP

3Y Swap EUR 2.12% -0.3 BP 2.8% 1.4% 22.8 BP

5Y Swap EUR 2.52% -0.4 BP 3.2% 1.6% 3.0 BP

10Y Swap EUR 3.16% -0.7 BP 3.8% 2.3% -16.5 BP

Other currencies

EUR/GBP 0.880 0.0% 0.9 0.8 2.5%

EUR/HRK 7.462 0.0% 7.5 7.2 1.1%

EUR/RON 4.245 0.0% 4.3 4.1 -0.8%

EUR/SEK 9.121 0.1% 9.5 8.7 1.5%

EUR/RUB 39.618 0.2% 43.9 38.8 -3.1%

EUR/UAH 11.491 0.0% 11.9 9.9 7.2%

EUR/TRY 2.434 0.2% 2.5 1.9 15.1%

EUR/BRL 2.235 0.1% 2.4 2.2 0.6%

EUR/CNY 9.256 -0.8% 9.7 8.5 4.7%

EUR/ZAR 9.582 0.0% 10.0 8.7 7.4%

Bond market

2Y Bund EUR 1.27% 0.4 BP 1.9% 0.6% 40.4 BP

5Y Bund EUR 1.84% -0.2 BP 2.8% 1.2% -0.2 BP

10Y Bund EUR 2.66% 0.5 BP 3.5% 2.1% -30.7 BP

2Y US Treasury 0.42% -1.8 BP 0.8% 0.3% -16.9 BP

5Y US Treasury 1.54% 1.8 BP 2.4% 1.0% -46.7 BP

10Y US Treasury 2.97% -1.5 BP 3.7% 2.4% -32.8 BP

Interest rates CEE3M Pribor 0.8 0.0 BP 0.9% 0.8% -3 BP

3M Wibor 4.6 1.0 BP 4.6% 3.7% 76 BP

3M Bubor 6.1 0.0 BP 6.1% 5.3% 24 BP

10Y Czech Rep. 3.9 1.5 BP 4.2% 3.2% 2 BP

10Y Poland 5.8 1.0 BP 6.4% 5.3% -24 BP

10Y Hungary 7.4 1.0 BP 8.4% 6.6% -57 BP

Equity markets CEE

Turkey (ISE Nat. 100) 61182 -0.3% 71777 57655 -7.3%

Croatia (CROBEX) 2155 -0.4% 2338 1773 2.1%

Poland (WIG20) 2689 -1.2% 2942 2373 -2.0%

Romania (BET) 5365 -0.5% 6099 5035 1.8%

Russia (MICEX) 1706 0.0% 1865 1328 1.1%

Serbia (BELEX15) 713 -1.6% 829 600 9.3%

Czech Rep. (PX) 1180 -0.5% 1278 1107 -3.6%

Hungary (BUX) 21419 -1.4% 24531 20147 0.4%

Commodities

WTI Oil USD/bbl 97.3 -0.2% 115.6 76.9 3.1%

Fuel oil USD/mt 972.0 -0.3% 1064.5 614.5 27.5%

Diesel USD/mt 1004.8 -0.2% n.a. n.a. 27.2%

CO2 EUA Fut. EUR/mt 12.3 -3.5% 15.8 13.5 -11.9%

Silver USD/oz 40.4 0.2% 49.8 17.3 30.6%

Platinum USD/oz 1781.1 -0.8% 1886.5 1489.0 0.6%

Palladium USD/oz 828.1 0.2% 862.3 459.3 3.3%

Steel USD/mt 613.0 0.0% 609.0 459.0 11.9%

Aluminium USD/mt 2644.0 -0.2% 2803.0 1982.3 7.0%

Copper USD/mt 9779.0 -0.4% 10190.0 7028.3 1.9%

Prices as of 28 July 11, 07:55 a.m. (CET)Source: Bloomberg


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This report was completed on 28 July 2011

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Daily Comment RR 28Jul11

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