* Greek bounce short-lived; Spain, Italy fears dominate
* Spanish 10-year bond yields rise above 7 pct
* Euro seen a sell into any bounce
NEW YORK, June 18 (Reuters) - The euro fell from a one-month high against the dollar on Monday after four days of gains, as an election win for pro-bailout parties in Greece faled to ease worrries about Spain's borrowing costs, which surged to levels seen as unsustainable.
While the election result allayed immediate fears of Greece being forced out of the euro zone, uncertainty persisted as the winning centre-right New Democracy party must now try to cobble together a government with other parties backing the international bailout.
Antonio Samaras, the New Democracy leader, on Monday, said the country needed as broad a coalition government as possible, after radical leftist refused to join.
Market players were also concerned about the euro zone's ability to respond to the risk of contagion engulfing larger economies like Spain and Italy. All of which is likely to see investors sell into any near-term bounce by the euro.
"The win in Greece does not really resolve anything. It's still going to be tough for Greece," said Boris Schlossberg, managing director ar investment advisory firm BK Asset Management in New York.
"And with Spanish and Italian yields at high levels, the credit market remained skeptical that Europe is going to get out of the debt crisis."
The euro was down 0.1 percent on the day at $1.2619, off a one-month high of $1.2747 struck in the Asian session, as it came under pressure on reported selling by Asian sovereign investors.
It fell past reported stop-loss orders around $1.2660-70 to $1.2620 in the European session with support expected around the June 13 high of $1.2610.
Ten-year Spanish government bond yields, hit by persistent concern about the country's fiscal and banking problems, rose above the 7 percent line seen as unsustainable in the long-term and at a level that forced other peripheral euro zone nations to seek bailouts.
Despite the problems facing the bloc, some strategists saw potential for the euro to rise given a build-up of huge bearish positions in the common currency, taken on concerns that a win for anti-bailout parties could lead to Greece rejecting austerity measures and leaving the euro.
"In the short term, a short squeeze or speculation about quantitative easing by the Federal Reserve could give the euro a lift, but in the medium term it is a sell because Europe's problems are deep-rooted and will not go away," said Howard Jones, adviser at RMG Wealth Management.
"Any rebound to around $1.2800 is a selling opportunity."
Positioning data showed speculators' massive net short positions of 195,187 contracts last week, even after having trimmed them from the previous week's record high of 214,418 contracts.
Fund of funds Quaesta Capital in Zurich Switzerland, which manages $3 billion in assets, saw euro shorts among its fund managers continuing to be one of the biggest positions last week, along with bets against the Swiss franc.
Interestingly, the U.S. dollar showed the largest outflow last week in the portfolios of the fund managers Quaesta tracks, while the Canadian currency showed the biggest inflow last week.
FED QE RISK MAY HELP EURO
In the options market, near-term implied volatilities fell, with the one-week easing to 11.45 percent from a high of around 16.75 percent last Thursday, while the one-month fell to a roughly four-week low of 11.26 percent.
However, one-month risk reversals pointed to a bias for euro weakness.
European finance ministers meet on Friday and a summit is scheduled for the end of this month, but little is expected in the way of fresh policy measures towards a banking union or greater fiscal integration like common eurobonds.
Traders expect some volatility in the currency market in coming days. The common currency could benefit versus the dollar on speculation that the U.S. Federal Reserve may opt for more easing to boost growth.
Many market players expect the Fed to extend its long-term bond-buying through Operation Twist by a few months from the current deadline of June, after a series of disappointing data. Additional easing by the Fed could also support other perceived riskier currencies against the greenback.
The dollar index was up 0.3 prcent at 81.845 after hitting a one-month low of 81.266. The Australian dollar was down 0.1 percent at US$1.0067, off a one-month high of US$1.0135.
The safe-haven yen fell against the euro, which rose 0.3 percent to 99.76 yen, while the dollar advanced 0.5 percent at 79.12 as a result of the initial risk-positive reaction to the Greek vote.
Trade Forex as Sterling Falls Following BoE Announcement - Yahoo Finance
LONDON, June 18, 2012 /PRNewswire/ --
On Friday, June 15, the pound fell against the US dollar following the Bank of England's announcement of an emergency liquidity package the day before. But how will you profit from this fall?
In the guide below, we show you how you can profit from the depreciating sterling through a spot forex trading account from City Index.
BoE Announces Emergency Liquidity Package
On Thursday evening last week (14 June), Governor Mervyn King suggested more quantative easing (QE) could be on its way as the Bank of England announced an emergency liquidity package to support the British banking system.
In his keynote speech, King said that the BoE would also be providing cheap long-term funding to encourage lending to businesses and consumers.
Pound Depreciates against Dollar
Whilst many investors in the marketplace said the measures planned by King would support the UK economy; further suggestions of monetary easing prompted investors to sell-off sterling in early London trade on Friday (15 June).
How to Trade Forex
With a City Index forex trading account you can take a position on the future price movement of 37 currency pairs within the foreign exchange market.
As a global currency market - trading 24-hours a day from Sunday evening to Friday night - forex offers traders multiple opportunities to potentially profit from fast-moving major, minor and exotic currency pairs.
Unlike in traditional equity markets, trading forex with City Index allows you to profit from market movements - regardless of whether they are rising or falling.
With this in mind, using the example above whereby the pound depreciates against the US dollar - traders have the potential to 'go short' and sell the pound with the aim of potentially profiting from every pip that it depreciates further.
In addition, as a leveraged product - forex trading requires only a small percentage of the underlying market's total value as an initial deposit.
This enables traders to control a relatively large exposure for only a small amount, gain greater access to the global currency markets and possibly magnify gains.
It is important to remember, however, that as a leverage product, you also run the risk of losing more than your initial deposit. A forex risk management strategy should be used in order to limit potential losses.
Start Trading Forex
To start trading forex across a range of trading platforms - including mobile - you can apply for a forex trading account with City Index through their website: http:http://www.cityindex.co.uk
Read More Forex Trading Tips
If you found this article helpful, you may want to read more just like this. You can access a range of free forex trading tips, guides and articles through the City Index website also.
About City Index:
Today more and more individual traders are discovering the benefits of derivatives, and many of them are discovering them through a City Index trading platform.
As a group, we transact in excess of 1.5 million trades every month in over 50 countries. We provide access to a wide range of instruments including margined foreign exchange, CFDs and, in the UK, financial spread betting.
We constantly look to improve the performance of our platforms and expand our range of services. The result is our customers benefit from innovative trading tools with transparent pricing, competitive spreads, and a high standard of customer support. Visit http://www.cityindex.co.uk/ for details.
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WORLD FOREX: Spain Back In Focus As Greek Election Euphoria Fades - NASDAQ
-- Euro reverses rally against dollar as Spain's borrowing costs soar to record highs
-- Hungarian forint, South African rand and Australian dollar also give up gains
By Alexandra Fletcher
The euro surrendered its initial post-Greek election gains against the dollar in European trading Monday, falling back to levels seen late Friday as doubts emerged over the victor's capacity to form a strong Greek government and as Spanish borrowing costs surged to a new euro-era high.
The currency pair traded to as low as $1.2618--over a cent below the highs seen in Asian trading after the election results from Greece showed the pro-bailout conservative New Democracy party winning by a slim margin.
But with data showing bad debts held by Spanish banks rose to an 18-year high in April and tough talks still to come to form a new coalition government in Greece, financial markets soon bubbled up with renewed signs of stress, dragging on the euro and supporting the dollar against a range of currencies.
The cost of insuring against a default on Spanish government bonds hit a record high, while yields on Spanish 10-year government bonds pushed beyond 7% for the first time since the launch of the euro, as attention shifted back to Spain from Greece and investors awaited the official word on the level of extra provisioning that will be demanded of Spanish banks.
"It's all about Spain," said Carl Hammer, chief currency strategist at Swedish bank SEB in Stockholm.
"Greece is too small to have a systemic impact, but Spain isn't, and it's hard to find anything to alleviate the pressure. The market is so skeptical that it's hard to come up with anything to boost sentiment," he said.
Emerging market currencies such as the relatively volatile Hungarian forint also reversed its early-morning gains. The euro traded as low as HUF290.54 against the forint, but later rose to HUF293.34.
The rand also did an about-turn, while the Australian dollar traded down close to parity with the dollar after surging in Asian hours.
Greece's New Democracy party Monday is set to begin talking with other parties on forming a pro-bailout coalition government. If successful, it could end a weeks-long political stalemate and pave the way for Greece to resume negotiations with international creditors on badly needed aid.
Looking ahead, retail and housing data from the U.S. is due at 1400 GMT.
At 1036 GMT, the euro was trading at $1.2640 against the dollar, unchanged from late Friday in New York, according to trading system EBS. The dollar was at Y79.10 against the yen, compared with Y78.78, while the euro was at Y99.98, compared with Y99.55. Meanwhile, the pound was trading at $1.5682 against the dollar, compared with $1.5716 late Friday in New York.
The ICE Dollar Index, which tracks the U.S. dollar against a basket of currencies, was at 81.704 from about 81.593.
A summary of key levels for chart-watching technical strategists is below:
Forex spot: EUR/USD USD/JPY GBP/USD USD/CHF Spot 1037 GMT 1.2636 79.10 1.5663 0.9507 3 Day Trend Bullish Range Bullish Range Weekly Trend Range Range Range Bullish 200 day ma 1.3189 79.63 1.5825 0.9196 3rd Resistance 1.2825 79.75 1.5848 0.9573 2nd Resistance 1.2748 79.51 1.5785 0.9537 1st Resistance 1.2725 79.31 1.5742 0.9518 Pivot* 1.2632 78.97 1.5644 0.9486 1st Support 1.2618 79.05 1.5645 0.9440 2nd Support 1.2604 79.00 1.5599 0.9420 3rd Support 1.2550 78.61 1.5511 0.9403 Forex spot: AUD/USD Spot 1037 GMT 1.0098 3 Day Trend Bullish Weekly Trend Bullish 200 day ma 1.0248 3rd Resistance 1.0274 2nd Resistance 1.0225 1st Resistance 1.0146 Pivot* 1.0056 1st Support 1.0090 2nd Support 1.0011 3rd Support 0.9922
-By Alexandra Fletcher, Dow Jones Newswires; +44 (0) 20 7842 9462, alexandra.fletcher@dowjones.com; @djfxtrader
(Dow Jones Technical Strategist Francis Bray contributed to this story.)
(END) Dow Jones Newswires 06-18-120717ET Copyright (c) 2012 Dow Jones & Company, Inc.
FOREX-Euro retreats from 1-month high vs dollar - Reuters
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Tough luck, Generation X: Only half of wealthy Baby Boomers to leave money for their kids...and ONE IN THIRD would rather give it to charity - Daily Mail
- Baby Boomers defined as people between the ages of 47 and 66
- Generation X refers to people born between early 1960s and early 1980s
- 55 per cent of Baby Boomers believe it's important to leave money to offspring
- Most Baby Boomers believe each generation should earn its own wealth
- Three-quarters of people younger than 46 favor leaving money to kids
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When members of the Baby Boomers generation die in the next 50 years, they will leave trillions of dollars in wealth behind, but their children should not hold their breath for a large inheritance.
According to the U.S. Trust Insights on Wealth and Worth annual study released on Monday, only 55 per cent of Baby Boomers - those between the ages of 47 to 66 - think it is important to leave money for their offspring.
U.S. Trust commissioned an independent, national survey of 642 high net worth adults, who were not clients, with at least $3million in investable assets.
Givers: A study found that 31 per cent of wealthy Baby Boomers would prefer to leave their money to charity
One of three Baby Boomers surveyed – about 31 per cent - don’t think it is important to leave a financial inheritance and said they would rather leave money to charity than to their children.
By contrast, three-quarters of wealthy people under age 46 said it's a priority to leave inheritance for their children.
The top reason for not wanting to leave money for their kids is the belief shared by some Baby Boomers that each subsequent generation should work to earn its own wealth.
Following closely behind is the thought that it is more important to invest in children’s success while they are growing up.
‘Our survey points to a shift in generational behavior and outlook, most likely shaped by personal experience and societal responses to economic realities,’ said Keith Banks, president of U.S. Trust.
Banks added that well-off parents are concerned that the next generation is not prepared to inherit wealth, which is not surprising considering the fact that most of the Baby Boomers surveyed don't talk to their kids about money: just 37 per cent said they've fully disclosed their net worth to their children.
Kept in the dark: Just 37 per cent of Baby Boomers said they've fully disclosed their net worth to their kids
Those over age 67 said they weren't having this discussion because they were raised to avoid money talk, while younger respondents said they didn't want to inhibit their kids' work ethic.
Unlike the majority of people from her generation, 63-year-old Kathleen Taylor, of Chimacum, Washington, taught her two grown children since they were young to be responsible for their own money.
That is why she plans to leave most of her money to her children and some money to charitable causes, ABC News reported.
One way Taylor and her husband taught their children about responsible spending was providing the value of college tuition, room and board to each of them and putting them in charge of paying the bills.
‘People thought we were crazy,’ she told ABC.
The Taylors plan to start a college fund once their children start having their own kids. And they intend to add to it on their grandchildren’s birthdays as long as Taylor and her husband are alive.
Mrs Taylor said she hopes her own children will do the same for their great-grandchildren.
The U.S. Trust study also has found that 42 per cent of Baby Boomers and 54 per cent of those under age 46 are paying medical costs for their parents or other relatives.
Forex Flash: EUR/USD expected to drop on worsening EMU situation – Danske Bank - FXStreet.com
Forex: EUR/JPY falls to 99.20 - FXStreet.com
Nigeria: Concern Mounts Over Forex Reserves Accretion - AllAfrica.com
The steady growth recorded by Nigeria's forex reserves since this year may discontinue as a result of the sharp drop in the price of crude oil.
THISDAY checks Sunday showed that the forex reserves -derived mainly from the proceeds of crude oil production, fell by $218 million in the last nine days, from $37.768 billion as at June 6 to $37.550 billion last Thursday.
The reserves which stood at $32,985 billion at the beginning of the year, improved remarkably to $35.608 billion at the end of the first quarter.
On the other hand, crude oil price settled at $83.99 per barrel on Friday, after touching an eight-month low near of $81.
This was attributed to concern over Spain's bank bailout, the euro debt scenario, among other external factors. The current value of the oil price reflected a drop by 35 per cent, compared with its peak value of $127 per barrel in mid-March.
At the current rate of decline, financial market experts predicted that forex inflow into the country would fall from the $4.31 billion it was in January to $3.34 billion next month, while they also forecast the external reserves would diminish to $22 billion- covering less than three months of imports.
The development has also impacted negatively on the naira as it has depreciated significantly against the United States dollar, especially at the interbank and parallel markets.
For instance, at the interbank market, the naira has so far fallen by N4.68 to N163.68 to a dollar on Friday, as against the N159 to a dollar it was on May 15. Similarly, at the parallel market, the local currency dropped by a total of N4.20 to close at N164.20/$1 on Friday, compared with the N160/$1 to a dollar it was a month earlier.
Managing Director of Financial Derivatives Company Limited (FDC), Mr. Bismarck Rewane, said the recent decline in oil prices was partly triggered by market sentiments of a further deepening crisis in the euro-zone, in conjunction with weak economic growth recorded in advanced economies in the first quarter of the year.
"The question however is how vulnerable are Nigeria's external reserves, should oil prices drop further, for example, to a low of $80 per barrel? The Federal Government's budget is benchmarked to oil price at $72 per barrel, while Bonny Light crude is trading at $98 per barrel.
This is a variance of $26 per barrel. At the current rate of decline, we expect forex inflows to fall from $4.31 billion in January to $3.34 billion in July.
"If oil prices were to drop to $80 per barrel (which is 50 per cent likelihood based on current trends), there is a 95 per cent likelihood that forex inflows will decline to approximately $3.03 billion."
"In this situation Nigeria's external reserves would be expected to follow suit and drop to a value as low as $22 billion, covering less than three months of imports. Resultantly, the CBN may be forced to allow the naira to depreciate sharply to N165/$1, to compensate for the substantial loss in oil revenue."
International Financial Advisory and Investment firm - Renaissance Capital (RenCap) also warned that the drop in oil price may pose some risk to the Nigerian economy if the trend continues, even as it expressed concern over the ability of the federal government to meet its revenue projections if the trend continues.
Vice President, Sub-Saharan Africa Economist, RenCap, Yvonne Mhango, said: "This evidently has implications for Nigeria given that it is an important oil exporter. Our estimates suggest that the risk to Nigeria's economy becomes significant if the average oil price for 2012 drops below $75 per barrel."
Similarly, FSDH Securities Limited, in its latest report, stated that "the recent sharp drop in the international price of oil has severe negative implications for the country's external reserves position in the short-to-medium term. The recent shortfall in crude oil production, coupled with the declining price of crude oil could put further pressure on the exchange rate in the face of growing demand, particularly from oil importers."
As a result of all these, the Coordinating Minister of the Economy/Minister of Finance, Dr. Ngozi Okonjo-Iweala, last Wednesday, advised members of the Federal Executive Council (FEC) to be proactive in decision making, so as to forestall effects of possible economic recession based on happenings in the global economy. She had warned them to shun wastefulness in the management of the nation's resources.
More money means more pain for fans - FOXSports.com
LONDON, England
If money is the root of all evil, then somebody forgot to tell supporters of Manchester City and Chelsea - both of whom get to spend the summer floating in a happy daze.
Before the arrival of their sugar daddies, backed by petrodollars from Abu Dhabi and Russia respectively, City were light years away from winning the Premier League title and Chelsea were hardly earmarked as contenders for the Champions League. Now, they are trophy-holders and serious contenders for next season.
Cash is not always king in football but it sure helps. For all the teams without billionaire benefactors, the mission to keep up with the spiraling salaries and trumped-up transfer fees is a challenge that is as overwhelming as it is risky. Some 60 per cent of Premier League clubs reported a loss when the last financial accounts were released.
Competing with the likes of City and Chelsea in the money league is an impossible task, so the rest have to be resourceful, and hope that the new regulations designed to try to encourage clubs to run themselves as a sustainable business (a pan-European initiative called Financial Fair Play) actually begin to shackle the spending power of the super rich. Not everyone, it must be said, is holding their breath on that one even if it is a nice idea.
And now there is suddenly even more money sloshing around for every Premier League club to get their hands on. A new, record-breaking television deal, worth a record $4.7 billion over three years — up a whopping 71 per cent on the previous arrangement — will soon be boosting the coffers everywhere. This is just a deal for domestic television rights, so when internet and overseas deals are factored in, the Premier League’s broadcasting worth is estimated at closer to a stunning $8 billion.
Each club is guaranteed at least $22 million more each year than they previously received. To put that into perspective, that means the last-placed finisher in 2013 will probably get more than Manchester City earned for finishing top of the Premier League pile last season. That sum, incidentally, totaled $95 million.
The Premier League’s chief executive, Richard Scudamore, believes the deal is very significant in comparison to major overseas clubs such as Real Madrid, Barcelona, AC Milan, Bayern Munich and so on.
"It allows people to plan and gives us a degree of financial security. I don't underestimate that,” he said. “The idea you can plan with some certainty your revenues for the next four years is a big thing."
And in fact, there is an interesting comparison with Spain’s La Liga, in which the heavyweighs from Barcelona and Madrid negotiate their own television rights individually. They can pull in around $200 million per season, but the smallest clubs earn a fraction – in the region of $20 million. The Premier League have a system where the deal is struck collectively. All boats are raised in England under this new deal – and suddenly, a leap to the Premier League means so much more to the teams in the Championship, a rung below.
It is questionable how great all this will turn out to be for fans, however. Somebody has to pay for these mega-deals, and part of the cost will presumably be passed on to the consumers in the form of price hikes for subscription channels that deliver football coverage. Live games have been the preserve of the pay-per-view channels in England for 20 years now. In that time, the cost of attending a match inside the stadium has ballooned, too.
But the increase is fabulous news, obviously, for clubs, players and the wheeler-dealer agents who squeeze every drop of earnings out that they can. It is likely that the $300,000 a week salary that Carlos Tevez takes home will soon be dwarfed. And with some big stars — Emmanuel Adebayor, Luka Modric and Robin van Persie come to mind — seeking improved deals, there are fewer reasons for clubs to stretch their payrolls.
As yet , there has not been an obvious knock-on effect in terms of the Premier League’s transfer activity. Only Chelsea have been notably lavish in advance of the European Championship, with the Belgian playmaker Eden Hazard arriving and Porto’s Hulk very strongly linked with a big money move. A greater indication of whether this gives clubs more clout in the market will come when the Euros finish.
Bruce Buck, Chelsea’s chairman, predicted Abramovich is eager to up the ante to help his team to build on the Champions League win. “We’ve seen him, year after year, invest and put his hand in his pocket and spend big money. He may go to another level now,” said Buck.
Chelsea, which starts next season's Premier League campaign at Wigan, are desperate for a stronger challenge in the league. City will kick off its title defense at home to Southampton but are eager to make more of a go of it in the Champions League.
Manchester United are intent on bouncing back, but have a tough start to the season against Everton - the team that wrecked United's title dream. Arsenal, who host Sunderland on the opening day, have to try to stay in the top four. Liverpool, who face Tottenham, Arsenal and Manchester City, in three of their first four fixtures, are under pressure to improve.
Now there is even more money to make the football world go round.
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