🐂 Not all bull runs are created equal. November’s AI picks include 5 stocks up +20% eachUnlock Stocks

FOREX-Dollar, yen firmer; await U.S. bank earnings

Published 07/17/2009, 05:33 AM
Updated 07/17/2009, 05:40 AM
EUR/JPY
-
GBP/JPY
-
C
-
IBM
-

* Euro down 0.3 pct at $1.4101 ; down 0.4 pct vs yen

* Market takes cue from equities; eyes U.S. bank earnings

* Jakarta blasts put pressure on risk appetite but limited

(Adds trade data, updates prices)

By Tamawa Desai

LONDON, July 17 (Reuters) - The dollar and yen were firmer against other major currencies on Friday as caution set in before more key U.S. corporate earnings later in the day.

U.S. stocks rallied for a fourth day on Thursday. U.S. stocks futures indexes were a little lower in mid-morning London trade.

"Currency markets are taking their lead from equities, with the dollar and yen generally firmer," said Adam Cole, global head of FX strategy at RBC Capital Markets.

Second quarter earnings results from Citigroup , Bank of America and General Electric are all due out later in the day, and the market is seen closely following stock market reaction to those results.

Stellar earnings results from Goldman Sachs and JPMorgan Chase earlier this week, as well as big corporates such as Intel , IBM and Google exceeding forecasts have buoyed risk-taking sentiment.

Markets shrugged off euro zone trade data for May, which posted a surplus of 1.9 billion euros, slightly lower than forecasts for 2.7 billion euros. [ID:nBRQ007443]

By 0903 GMT, the euro was down 0.3 percent at $1.4101 and down 0.3 percent at 132.20 yen .

Brighter sentiment had almost caused currency pairs to break out of consolidation patterns, but not quite. Euro/dollar was holding its symmetrical triangle dating back to the start of June.

The euro is also on track for its best weekly performance against the dollar in two months, or up 0.9 percent on the week.

The dollar index was up 0.3 percent at 79.451 <.DXY> after falling to a six-week low at 79.131 the previous day.

Sterling was down 0.7 percent at $1.6317 and down 0.8 percent at 152.94 yen .

The U.S. currency eased 0.1 percent to 93.70 yen .

The dollar dipped to a five-month low of 91.73 yen in July and its rise stalled at 94.46 yen this week -- right around a 38.2 percent Fibonacci retracement of the dollar's fall from its high in June of 98.90 yen down to the five-month trough.

Risk sentiment was dampened after bomb blasts at hotels in Jakarta, although most analysts did not expect any lasting effect on markets.

"The blasts have added to this direction in terms of risk trades coming off," said Mitul Kotecha, head of FX strategy at Calyon in Hong Kong, but added it wasn't a big move.

Reaction was muted to comments from Japan's new currency tsar, Rintaro Tamaki, who said the U.S. dollar will remain a core asset in Japan's $1 trillion of foreign currency reserves.

Tamaki also said he would not completely rule out currency intervention, but that foreign exchange rates should be determined by the market. [ID:nTKF106478]

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.