Historical Rally on the Market

Oct. 28, 2011 - PRLog -- The dollar and the yen led the week’s drop against most major currencies, as the global rally that began on the stock markets on Thursday dampened demand for safe-haven assets.

The Euro rose 0.5% from a seven-week high against the yen after European leaders came to an agreement to expand the EFSF for debtors and their creditors to make the last write-offs of Greek debt. The dollar continued to drop against the Euro after data published yesterday on US GDP growth showed even higher numbers. DT Trading analysts report that the data published today on consumer spending should diminish any expectations that the US Federal Reserve might introduce additional monetary stimulus measures.

Today the dollar was trading at $1.4195 per Euro as of 8:47AM in Tokyo, versus $1.4189 in New York yesterday, appreciating 2.2% this week. The Euro also appreciated 0.1% to 107.86 against the yen. The yen slid down from 75.95 to 75.96 against the dollar after reaching 75.66 yesterday, a high not seen since the World War II era.

The MSCI World Index (MXWO) of 24 developed countries, including Germany and Japan, shot up 4.2% yesterday, the highest rate since May 2010. The Stoxx Europe 600 Index added 0.5%.

In trading in New York yesterday, stocks rose, adding to the largest monthly growth for the Standard & Poor’s 500 Index since 1974. American bonds fell at the same time that metals and oil led the ascent among commodities.

The S&P 500 jumped up 3.4% to 1,284.59 at the close of trading in New York, making its total October growth 14% and thus closing 2011 with an overall loss. The Dow Jones Transportation Index, which includes only transportation companies most closely linked to the economy, saw a 20% rally this month, the largest growth since the end of the Great Depression in 1939. Stock market indexes in France, Italy, and Germany rose more than 5% since German stocks and stocks on emerging markets increased their growth from their previous lows of the year by more than 20%. The Euro rose the most over the past 12 months and yields on 10-year US treasury bonds rose 17 basis points to 2.38%. Yields on 10-year German bonds rose for the second day in a row and yields on analogous Japanese bonds reached a seven-week high. Copper and oil underwent a correction, with each fixing the same weekly percentage increase.

Today, futures on the S&P 500 Index rolled back 0.4% after a 3.4% jump in trading yesterday. The Korean won went up 0.9%.

DT Trading Limited Analytical Department

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