By FX Empire.com
Markets were able to restore some confidence on Thursday, following fresh developments in the Euro Zone along with new updates over the U.S economy this morning, after Lucas Papademos was named to be interim prime minister of Greece, the U.S jobless claims fell to its lowest since April and U.S trade deficit narrowed in September.
If truth be told, Europe’s turmoil was slightly overshadowed on Thursday, after the number Americans filing for unemployment insurance fell by 10 thousand to 490 thousand, scoring the lowest level since April 2011, the U.S trade deficit unexpectedly tightened to -$43.1 billion from -$44.9 billion in September, the lowest level in 2011, bolstered after exports rose to record in September, a sign that the economic recovery will probably stem the effect of Europe’s debt crisis.
Bearing in mind, equities slumped heavily yesterday on fears that Euro zone will be facing a radical reform after Italian yields climbed to a euro-area record, and officials said the Euro zone is about to breakup. Yesterday, the selloff wave was doubled and huge losses was registered, where we saw the Dow Jones Industrial Average flushing nearly 400 points and the Standard & Poor’s 500 index shaved gains of the earlier month.
Therefore, investors were very concerned about that political uncertainty in Greece and Italy amid the slow progress of the governmental reforms in both countries. In Greece, the former PM George Papandreou has already lost much and it was time for new PM to take the steer, leading the new coalition government and pull some heavy action. While regarding the second euro-indebted country, Italy met its fund-raising target today in a auction of Treasury bills and European Central bank was said to buy Italian bonds on Thursday. Earlier on Thursday, concerns that European leaders are failing to stem the region’s debt crisis, propelled the yields on French Government bonds to hit a record high, underscoring that the euro leaders yet have a lot of work to do.
Currencies traded narrowly on Thursday, as the U.S. dollar fell slightly against a basket of major currencies on Thursday, where the U.S. dollar index was trading at 77.81, compared with the opening level at 77.92. The Euro gained faintly against the dollar following yesterday’s loss, where the EUR/USD pair traded at $1.3584, compared with the opening level at $1.3526, the British Pound eased before the Dollar, where the GBP/USD pair traded around $1.5893, compared with the opening level at $1.5912, and the U.S. dollar steadied against the Japanese Yen, where the USD/JPY pair was trading at 77.58, compared with the opening level at 77.77.
American equities rebounded this morning from its yesterday’s lows, where the DJIA gained 0.56 percent to trade around 11847 and the S&P 500 Index added 0.39 percent to trade around 1233. European equity benchmarks swung between gains and losses before closing on Thursday, as the FTSE 100 Index fell 0.48 to trade around 5434, DAX Index gained 0.63 to 5866 and the CAC 50 Index declined 0.33 to trade around 3065. Gold prices were lower on Thursday to trade now around $1744.99 an ounce after opening at $1771.18 an ounce, while crude oil prices gained after commodities rebounded to trade around $97.18 a barrel after opening at $95.64.
Originally posted here
