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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: CalculatedRisk who wrote (23753)	2/17/2005 9:21:52 AM
From: mishedlo	Respond to of 116555

grain report CORN: Hi, this is Tim Hannagan and it is Wednesday, February 16th and the markets are closed. After seeing contract lows matched last Wednesday we saw funds carrying a record short position in March buy out taking March up to four week highs of 2.02 before commercials heavily long began to sell. This is what is going to keep corn in a fairly tight range, as funds buy the breaks, commercials sell the rallies. The best case on the upside is 2.10 resistance but I don not expect anything higher into months end over 2.06. If we are going to fill the chart gap to 2.06 it looks to occur Monday to Wednesday next week, if next week’s weather in South America is dry again pushing beans sharply higher dragging corn with it. Without a dry forecast we will trade between 1.95 and 2.02 into Wednesday. BEAN: Since last Wednesday we have seen large trading funds holding a record short position in March buying out ahead of month end delivery notices. After being under 5.00 briefly they spent Wednesday, Thursday, Friday and Monday buying back shorts on rallies as prices were cheap, with major resistance at 5.42 and highs so far this week at 5.39. They are now willing to buy out of shorts on breaks, capping our highs for the week unless something new enters. That something new would be South American weather where beans are in their key pod setting stage. We pushed up to the high 5.39 area on a week’s weather that brought only light rain in a small area the last 24 hours. All the weather gurus see hot and dry Thursday to Sunday. That is priced in. Now, we need to know next week’s weather to know if new highs are coming. If rain enters next week March futures will pull back into the 5.20 area. If dry we will take out 5.42 with 5.60 as next resistance. The best weather site out there WXRISK.com sees next week as being warmer and drier with only another small chance midweek of light rain. If true we are going higher. There is a few private forecasters calling for much bigger rains. It is going to take until Friday to get a better look at next week’s weather. Right now, we are mixed on views and that keeps us choppy with a lean to the downside on over bought conditions. Aggressive traders can buy March on a move under 5.30 and gamble next week’s weather stays dry but use tight stops. WHEAT: Our 13 cent short covering rally from last week’s low to this week’s high was short lived as producers holding old crop in storage took it to town for cash leaving cash prices to slide taking March futures with it. 6 cent losses were seen at mid-session. They broke through 2.95 support making new support at 2.90 then 2.84. We need a close over 3.07 to turn bullish on the charts and that is not likely with our generally weak demand and forecasts for good moisture the next 10 days across our dormant winter wheat states.

To: CalculatedRisk who wrote (23753)	2/17/2005 9:23:13 AM
From: mishedlo	Respond to of 116555

Sterling marginally higher after rebound in Jan retail sales Thursday, February 17, 2005 10:37:15 AM afxpress.com LONDON (AFX) - Sterling was slightly higher after the release of figures showing that UK retail sales rebounded in January Official data revealed that retail sales rose 0.9 pct in January from December, helping to reverse December's dismal figures which showed that retailers suffered their worst Christmas in nearly 25 years At 10.15 am, the pound was at 1.8925 against the dollar, up from 1.8898 just before the data was released, while the euro dropped to 0.6908 stg from 0.6912 previously The figure was marginally above expectations for a 0.8 pct month-on-month rise, but this was offset by news that the data for December was revised to show a 1.1 pct fall, even worse than the 1.0 pct drop previously reported "For now, this 'in line' bounce will provide some temporary solace for sterling bulls and interest rate hawks," said CALON analyst Daragh Maher Nevertheless, today's report does not justify any "lasting shift" in interest rate expectations or in sterling sentiment, he said Firstly, the quarter-on-quarter rate of sales growth was zero in January, the slowest pace since the second quarter of 2003. Secondly, the strength in sales volume comes at the price of heavy discounts by retailers The Bank of England will therefore "be wary of signalling any intent to raise interest rates against such an uncertain backdrop for consumption," Maher said

To: CalculatedRisk who wrote (23753)	2/17/2005 9:27:18 AM
From: mishedlo	Respond to of 116555

UK Jan retail sales rebound, but period of robust growth pronounced over Thursday, February 17, 2005 9:48:51 AM afxpress.com LONDON (AFX ) - UK January retail sales bounced back from the near 25-year slump the previous month, but the office of National Statistics pronounced that the period of robust growth since the middle of 2003 "appears to have come to a halt" Retail sales in January rose 0.9 pct from the previous month, just above expectations of a 0.8 pct increase and is the strongest since September last year More alarmingly, however, data for December was revised down to show a 1.1 pct slump compared with the 1.0 fall previously estimated due to late arriving data. The new reading remains the lowest since January 1983 On a year-on-year basis, retail sales growth rose by 3.9 pct, from December's unrevised 3.2 pct rise. The latest reading is in line with predictions Over the three months to January, the statistics office said retail sales growth slowed to show no growth at all. The 0.0 pct reading is the lowest since April 2003 and represents a significant drop from the 0.2 pct rise in the three months to December In January, retail sales were higher in all categories -- both in food and in non-food stores. However, the residual category in the non-food stores sector recorded a drop. This category includes shops selling books, toys, mobile phones and personal computers The latest numbers indicate that consumer spending has softened, in turn suggesting that the Bank of England may not have to raise interest rates again. But data for the coming months will be equally important to gauge whether the softer tone is a new trend rather than a blip Last month, BoE Governor Mervyn King urged markets not to read too much in just one month's data, adding that it may take a few months for the figures to paint a clear picture of the retail sector

To: CalculatedRisk who wrote (23753)	2/17/2005 9:31:17 AM
From: mishedlo	Respond to of 116555

Major Stock Market Top Further Confirmed by Latest NAGB Housing Market Index Data financialsense.com

To: CalculatedRisk who wrote (23753)	2/17/2005 10:38:06 AM
From: mishedlo	Read Replies (1) \| Respond to of 116555

While the improving U.S. economy remains the engine of growth for the world economy, an underlying trend involving "huge imbalances and risks" should be cause for serious alarm, Paul Volcker warned Feb. 11 during a speech on campus. Americans have virtually no savings, the former chairman of the Federal Reserve said, and the nation is consuming more than it is producing. Furthermore, Social Security and Medicare are threatened by the retirement of millions of baby boomers and skyrocketing health care costs. More broadly, he continued, the world economy is lopsided. "Altogether, the circumstances seem as dangerous and intractable as I can remember," Volcker said during a keynote address at the second annual summit of the Stanford Institute for Economic Policy Research. "But no one is willing to understand [this] and do anything about it."[...] news-service.stanford.edu

To: CalculatedRisk who wrote (23753)	2/17/2005 10:40:18 AM
From: mishedlo	Respond to of 116555

U.S. IMPORT AND EXPORT PRICE INDEXES JANUARY 2005 full report here: bls.gov The U.S. Import Price Index increased 0.9 percent in January, the Bureau of Labor Statistics of the U.S. Department of Labor reported today. The increase followed a 1.4 percent decline in December and was attributable to higher prices for both petroleum and nonpetroleum imports. Export prices increased 0.7 percent in January after advancing 0.2 percent in December. Import Goods Import prices rose 0.9 percent in January after declining in December and November. Petroleum prices, the main contributor to the declines in the previous two months, led the overall increase in import prices in January. The price index for import petroleum rose 4.6 percent in January after falling 16.8 percent over the prior two months. For the year ended in January, petroleum prices were up 26.9 percent. Nonpetroleum import prices increased for the third consecutive month, rising 0.2 percent in January after increasing 0.4 percent in December and 0.9 percent in November. Over the past 12 months, prices for nonpetroleum imports increased 3.0 percent, while overall import prices advanced 6.0 percent. Rising prices for consumer goods, for capital goods, and for nonpetroleum industrial supplies and materials all contributed to the modest January increase in nonpetroleum prices. The price index for import consumer goods rose 0.4 percent, the largest increase for the index since January 2004. The increase in consumer goods prices, which were up 0.8 percent over the past year, was led by higher prices for medicinal and pharmaceutical products. Capital goods prices rose for the third consecutive month, advancing 0.2 percent in January. Despite the recent upturn, the price index for capital goods declined 0.8 percent over the past 12 months. Prices for nonpetroleum industrial supplies and materials edged up 0.1 percent last month and increased 13.1 percent for the year ended in January. In contrast, the price indexes for automotive vehicles, parts, and engines and for foods, feeds, and beverages recorded modest decreases in January. Prices for automotive vehicles fell for the first time since September 2003, declining 0.1 percent in January. The foods, feeds, and beverages index dipped 0.2 percent in January following increases in each of the previous four months. Prices for foods, feeds and beverages increased 6.9 percent over the past 12 months. Export Goods Export prices rose 0.7 percent in January, with both agricultural and nonagricultural prices contributing to the increase. The price index for agricultural exports advanced 0.3 percent in January, led by higher prices for both soybeans and corn. Despite the increase, agricultural prices decreased 6.2 percent over the past 12 months. Prices for nonagricultural exports increased 0.7 percent last month and were up 5.1 percent for the year ended in January. Overall export prices rose 4.0 percent over the same period and have increased for five consecutive months. Prices for nonagricultural industrial supplies and materials continued to trend upward in January, increasing 1.5 percent. Higher fuel and chemical prices led the January rise in the price index for this area, which rose 15.5 percent for the January 2004-2005 period. Increasing prices for each of the major finished goods areas also contributed to the January increase in nonagricultural export prices. Prices for both capital goods and for automotive vehicles rose 0.3 percent in January, the fourth consecutive increase for each index. Over the past 12 months, capital goods prices increased 1.0 percent and prices for automotive vehicles advanced 1.3 percent. The price index for export consumer goods increased 0.6 percent last month, the largest monthly increase for the index since 1992. Higher prices for durable goods and for medicinal and pharmaceutical products led the increase. Export consumer goods prices advanced 1.6 percent for the year ended in January. Imports by Locality of Origin Prices for imports from the European Union increased 1.3 percent in January, which was the largest monthly gain for the index since January 2004. European import prices were up 6.8 percent over the past 12 months. The price indexes for imports from Mexico and from Canada both rose last month, increasing 0.8 percent and 0.3 percent, respectively. For the year ended in January, import prices from Mexico were up 4.1 percent and prices of imports from Canada increased 10.3 percent. In contrast, import prices from Japan and from China declined in January, decreasing 0.2 percent and 0.1 percent, respectively. Over the past year, import prices from Japan were up 0.7 percent, whereas prices for imports from China fell 0.7 percent. Import and Export Services Import air passenger fares declined 0.7 percent in January, led by an 8.8 percent drop in Asian fares. Despite this decline, import air passenger fares rose 6.5 percent for the year ended in January. Export air passenger fares advanced for the third consecutive month, increasing 5.2 percent in January. The index rose 10.3 percent over the past 12 months.