Trading

TradeTheNews.com Market Internals update

- NYSE volume 560M shares, about 22% below its three-month average; advancers lead decliners by 1.6:1.
- NASDAQ volume 1.58B shares, about 2% below its three-month average; advancers lead decliners by 1.2:1.
- VIX index +1.5% at just over 14.00

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TradeTheNews.com Market Internals update

- NYSE volume 435M shares, about 20% below its three-month average; advancers lead decliners by 1.8:1.
- NASDAQ volume 1.21B shares, about 3% below its three-month average; advancers lead decliners by 1.2:1.
- VIX index -0.3% at just over 14.00

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TradeTheNews.com Market Internals update

- NYSE volume 300M shares, about 22% below its three-month average; advancers lead decliners by 1.5:1.
- NASDAQ volume 855M shares, about 1% below its three-month average; advancers lead decliners by 1.1:1.
- VIX index -0.3% at just over 14.00

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TradeTheNews.com TradeTheNews US Market Update

Dow +44 S&P +1 NASDAQ -4
**Economic data***
- (MA) Malaysia Mar M3 Money Supply Y/Y: 8.2% v 7.9% prior
- (BE) Belgium Mar Unemployment Rate: 7.7% v 7.7% prior
- (CL) Chile Mar Unemployment Rate: 7.3% v 7.5%e
- (SA) South Africa Mar Trade Balance (ZAR): +1.0B v -0.8Be; Budget Balance: -4.9BB v +7.9B prior
- (CA) Canada Feb Gross Domestic Product M/M: -0.2% v 0.0%e; Y/Y: 2.9% v 3.1%e
- (US) Q1 Employment Cost Index: 0.6% v0.5%e
- (US) Mar PCE Core M/M: 0.1% v 0.1%e; Y/Y: 0.9% v 0.9%e; PCE Deflator Y/Y: 1.8% v 1.9%e
- (US) Mar Personal Spending: 0.6% v 0.5%e; Personal Income: 0.5% v 0.4%e
- (BE) Belgium Q1 Preliminary GDP Q/Q: 1.0% v 0.5% prior; Y/Y: 3.0% v 2.1% prior
- (BE) Belgium Mar YTD Budget Balance: -€11.1B v -€5.4B prior
- (BR) Brazil Mar Primary Budget Balance (BRL): 13.6B v 12.1Be; Nominal Budget Balance: -6.9B v -6.8Be; Net Debt % GDP: 39.9% v 39.9%e
- (US) Apr Chicago Purchasing Manager: 67.6v 68.2e
- (US) Apr Final University of Michigan Confidence: 69.8 v 70.0e
- (US) Apr NAPM-Milwaukee: 68.0 v 63e

- Markets in general are experiencing more of the same during the week's final trading session. With the UK and Japanese equity markets closed overall volumes are light but stock prices continue to appreciate. The Greenback remains under pressure pushing metals and energy higher. The Dow and S&P continue to make new multi-year highs on the backs of strong earnings reports while the tech heavy NASDQ lags. The morning's data offered little in the way of surprises with spending and income holding up while price index figures were broadly in line with expectations. The PCE y/y rounded down to 1.8% but it worth pointing out on an annualized basis using the last three months PCE y/y rose to 1.9% nearing the Fed's implied target. Gold hit yet another fresh all time high above $1540 and June crude is still holding $113. Treasury prices opened higher but some technical selling on light volume early in the session backed yields up a few basis points. Traders are noting 3.25% is likely substantial resistance for the 10-year note as it hovers around 1-month lows at 3.3%.

- Solar stocks are shining brightly after France's Total announced a tender offer for 60% of Sunpower at $23.25 as well as an additional $1b in credit support over the next five years. SPWRA is up more than 35% from yesterday's close and other Solar names gapped higher on the open before giving back a majority of gains.

- Caterpillar is bulldozing the Dow to fresh 2011 highs after their Q1 earnings report. Top and bottom line results handily beat consensus expectations and management raised FY11 guidance above analyst's estimates which included another $2-4B in revenue above what they just projected in late March. Goodyear Tire showed good traction in their Q1 results despite surging input costs. The company also noted they expect unit volume increases to be at the high end of their previous 3-5% forecast for the year.

- Research in motion is churning sharply lower after lowering Q1 sales and earnings guidance and cited weaker BlackBerry smartphone volumes specifically. Management attempted to reassure investors their PlayBook is sound by noting tablet sales remain in line with previous expectations and also offered full year eps guidance s above analyst's consensus. Regardless investors are clearly looking for an audible sending the stock down 13% and weighing heavily on the NASDAQ.

- Dealers cited light month-end selling of USD continued into the NY morning but the greenback was off its worst level after the release of US personal spending and income data. Dealers pondering the effects of trading next week with UK markets closed again on Monday and Golden Week in Japan. The USDCNY fixed below 6.50 prompted fresh rumors abound China might revalue yuan or again aise the RRR in the near future. The Global View D.O.G. (Dollar, Oil, Gold) Index was at 0.4924 vs .4935 prior close


**Looking Ahead***
- (CO) Colombia Central Bank Interest rate Decision: Expected to raise the Overnight Lending Rate by 25bps to 3.75%
- (MX) Mexico Mar YTD Budget Balance: No est v €11.3B prior
- 11:00 (US) Fed to purchase $5-7B in Notes/Bonds
- 12:00 (CO) Colombia Mar Urban Unemployment Rate: 12.3%e v 13.2% prior
- 12:30 (US) Fed Chairman Bernanke speaks at Fed Community-Affairs
- 15:00 (AR) Argentina Mar Construction Activity M/M: No est v 1.3% prior; Y/Y: No est v 13.4% prior

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TradeTheNews.com Market Internals update

- NYSE volume 170M shares, about 22% below its three-month average; advancers lead decliners by 1.1:1.
- NASDAQ volume 480M shares, about 3% above its three-month average; decliners lead advancers by 1.1:1.
- VIX index +0.25% at just over 14.00

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TradeTheNews.com European Market Update: EU inflation accelerates in April; Spanish Unemployment at highest level since 1997

***Economic Data***
- (RU) Russia Central Bank raises Refinancing Rate by 25bps to 8.25%; Not expected
- (RU) Russia Narrow Money Supply (RUB): 5.87T v 5.82T prior
- (FI) Finland Feb Final Trade Balance: -€13M v -€10M prelim
- (GE) Germany Mar Retail Sales M/M: -2.1% v +0.2%e ; Y/Y: -3.5% v 1.4%e
- (SA) South Africa Mar Private Sector Credit Y/Y: 5.1% v 5.9%e; M3 Money Supply Y/Y: 6.5% v 7.8%e
- (FR) France Mar Producer Prices M/M: 0.9% v 0.7%e; Y/Y: 6.6% v 6.4%e
- (SP) Spain Apr Preliminary Consumer Price Index Y/Y: 3.8% v 3.6% prior; CPI EU Harmonized Y/Y: 3.5% v 3.4%e
- (SP) Spain Mar Adjusted Real Retail Sales Y/Y: -8.6% v -4.9%e; Real Retail Sales Y/Y: -7.9% v -4.8% prior
- (SP) Spain Q1 Unemployment Rate: 21.3% v 20.7%e
- (HU) Hungary Mar Producer Prices M/M: 0.0% v 0.2% prior; Y/Y: 6.6% v 7.1%e
- (NO) Norway Apr Unemployment Rate: 2.8% v 2.8%e
- (TU) Turkey Mar Trade Balance: -$9.8 v -$7.8Be
- (TH) Thailand Mar Business Sentiment: 54.1 v 52.3 prior
- (TH) Thailand Mar Current Account: $1.9B v $2.8Be; Total Trade Account Balance: $1.9B v $2.0B prior; Overall Trade Balance: $1.4B v $4.3B prior
- (SW) Sweden Mar Household Lending Y/Y: 7.3% v 7.5% prior
- (SW) Sweden Mar Retail Sales M/M: -0.8% v +0.2%e; Y/Y: 0.7% v 2.8%e
- (SW) Sweden Feb Non-Manual Workers Wages Y/Y: 1.5% v 1.6% prior
- (CZ) Czech Money Supply Y/Y:2.5 % v 2.8% prior
- (EU) Euro Zone Mar M3 Money Supply Y/Y: 2.3% v 2.2%e; M3 Money Supply 3 month avg: 2.0% v 1.9%e
- (IT) Italy Mar Preliminary Unemployment Rate: 8.3% v 8.4%e
- (TT) Taiwan Q1 Preliminary GDP Y/Y: 6.2% v 5.0%e
- (SP) Spain Feb Current Account: -€5.4B v -€6.6B prior
- (HK) Hong Kong Mar M2 Money Supply Y/Y: 7.2% v 8.0% prior
- (EU) Euro-Zone Apr CPI Estimate Y/Y: 2.8% v 2.7%e
- (EU) Euro Zone Apr Business Climate: 1.28v 1.40e; Consumer Confidence: -11.6 v -11.4e; Economic Confidence: 106.2 v 107.0e; Industry Confidence: 5.8 v 6.6e; Services Confidence: 10.4 v 10.5e
- (EU) Euro Zone Mar Unemployment Rate: 9.9% v 9.9%e
- (IT) Italy Apr Preliminary CPI (NIC incl. tobacco) M/M: 0.5% v 0.3%e; Y/Y: 2.6% v 2.4%e
- (IT) Italy Apr Preliminary CPI EU Harmonized M/M: 1.1% v 0.7%e; Y/Y: 3.0% v 2.6%e (highest since Oct 2008)
- (PO) Portugal Apr Consumer Confidence: -49.5v -48.4 prior; Economic Climate: -1.8 v -1.4 prior
- (HK) Hong Kong Mar Govt Mthly Budget Balance (HKD): -9.1B v -9.5B prior
- (GR) Greece Feb Retail Sales Y/Y: -7.0% v -13.7%e
- (SZ) Swiss Apr KOF Swiss Leading Indicator: 2.90v 2.20e

Fixed Income
None Scheduled

*** SPEAKERS/FIXED INCOME/FX/COMMODITIES/ERRATUM ***
***Notes/Observations:
- China currency (CNY) strengthens to best level since 1993 at 6.4820

Equities:
DAX +0.21% at 7490, CAC 40 -0.30% at 4093, IBEX 35 flat at 10,865, FTSE MIB 0.10% at 22392, SMI +0.40% at 6542

- European shares dipped after a 6-day winning marathon as investors take profit during a quiet session with the FTSE100 closed due to the royal wedding. Corporate earnings have been strong which may lead analysts to revise estimates upwards heightening expectations for companies.
Oil company Total [FP.FR] reported an adjusted net profit which slightly surpassed the analysts estimates. Profit was higher on rising oil prices but production fell about 2% due to Libyan unrest. Refining margin also came under pressure as oil prices increase. Shares fell at the open but are trading in positive territory now. Daimler [DAI.GE] declined during the session as company missed expectations for the second consecutive quarter. This stands in sharp contrast with Volkswagen numbers which satisfied investors. Profit increased thanks to China's sales but not to the level expected by the markets. Company reaffirmed outlook for 2011.

Speakers:
- SNB Hildebrand commented that the domestic economy was growing vigorously despite strong CHF currency, as exports were better than feared. Swiss inflation trend was currently moderate and helped by the firmer Swiss Franc. However, upside risks to price stability were starting to emerge and he added that high commodity prices could impact the country if the Franc weakened fast. Swiss business mood indicated favorable economic developments. The SNB continued to expect domestic growth to weaken in 2011 to about 2%, but the economy was growing stronger than expected but cautioned that downside risks to the domestic economy were still very large.
- EU/ECB /IMF set to begin visit to Athens to assess the country's Greece's eligibility to receive the fourth tranche of its €110B bailout established last May
- Vietnam Central Bank Raises Refi Rate 100bps to 14%, Raises Discount Rate 100bps to 13%; effective 1st May
- Philippines Central Bank Dep Gov Guingundo: Strong PHP currency reflects the Philippine economy. March rate hike and subsequent moves, if needed, aimed at keeping inflation on target. Inflation is a reason for concern, but it is still manageable.
- Russia Central Bank commented after its rate decision that the rate hike was due to the high level of inflationary expectations and that future rate decisions would depend on the balance between inflation and slowing economic growth. It noted that the annual inflation accelerated in April but that the price shock from the 2010 drought was declining.
- Thailand Fin Min: US can only repay its debt through currency devaluation. He also noted that the Internationalization of China CNY currency was currently happening.

Currencies/Fixed income:
- The Thai Fin Min confirmed what the FX markets long suspected on the Far East view of the greenback. Thailand Fin Min commented that the US could only repay its debt through currency devaluation. The minister also confirmed that its central bank has been both buying and selling USD in the FX markets in a two-step intervention process. Typically the Asian central banks have bought USD to weaken their respective home currency and then sell the USD accumulated into Euros. Overall the greenback maintained a soft tone against the majors in a quiet session that was 'enveloped' by the UK Royal Wedding.
- The EUR/USD was at its best levels in the session above 1.4860. The Euro Zone flash CPI data came in above expectations which confirmed market expectations that the ECB would likely raise its key Refi rate two more times in 2011.
- The CHF was firmer in the session after SNB President Hildebrand commented that the Swiss economy was growing vigorously despite strong CHF currency. EUR/CHF cross dipped by 50 pips after the comments to test 1.2900 while USD/CHF remained near its all-time lows around 0.8675 level.

Geo-Political/ In the Papers:
- The Bank of England appeared to have been correct in its forecasts for growth and inflation, and correct in holding off on lifting interest rates in the belief that the rise in inflation was temporary according to the US financial press. The source cited the surprise decline in the March CPI data. In addition, the central bank may have also been correct in noting that the economic growth was not yet strong enough for rate hikes.
- The European Central Bank is expected to hold a meeting Friday regarding the covered bond market. The meeting is expected to seek to reassure investors about the quality of their covered bond holdings. The ECB has bought about €60 billion in covered bonds, and banks have been selling covered bonds at record rates in 2011.
- In the Financial Times, it was reported that British Labour Leader Miliband raised concerns about the upcoming Scottish parliamentary elections. He said that if the Scottish National Party (SNP) wins the elections next week, they could use the victory to gain support for an independent Scotland. According to polls conducted by Weber Shandwick, the SNP has a double digit lead over the Labour party, which is enough to add 13 seats to its prior tally of 47. Note, back in the early part of 2009, the SNP's Alex Salmond suggested that Scotland considered abandoning the pound and joining the Euro.
- The Telegraph reported that the demand for retail commercial space in Britain remains weak. The article cites cautious comments from property companies, including Hammerson and Segro. According to Hammerson, the British austerity measures have weighed on consumer spending.

***Looking Ahead***
- (CO) Colombia Central Bank Interest rate Decision: Expected to raise the Overnight Lending Rate by 25bps to 3.75%
- (PO) Portugal Mar Retail Sales M/M: No est v 1.2% prior; Y/Y: No est v -4.6% prior
- (BE) Belgium Mar YTD Budget Balance: No est v -€5.4B prior
- (BE) Belgium Mar Unemployment Rate: % v 7.6% prior
- (BR) Brazil Mar Central Govt Budget (BRL): 8.4Be v 2.6B prior
- (MX) Mexico Mar YTD Budget Balance: No est v €11.3B prior
- (SZ) Swiss Q1 Real Estate Index Family Homes: No est 390 prior
- 6:00 (EU) Italy's Codogno speaks at Brussels Think Tank
- 6:00 (IT) Italy Mar PPI M/M: No est v 0.6% prior; Y/Y: No est v 5.7% prior
- 6:00 (MA) Malaysia Mar M3 Money Supply Y/Y: No est v 7.9% prior
- 6:45 (IC) Iceland to sell Bonds
- 8:00 (CL) Chile Mar Unemployment Rate: 7.5%e v 7.3% prior
- 8:00 (SA) South Africa Mar Trade Balance (ZAR): -1.0Be v -0.3B prior; Budget Balance: No est v 7.9B prior
- 8:30 (CA) Canada Feb Gross Domestic Product M/M: 0.0%e v 0.5% prior; Y/Y: 3.1%e v 3.3% prior
- 8:30 (US) Q1 Employment Cost Index: 0.5%e v 0.4% prior
- 8:30 (US) Mar PCE Core M/M: 0.1%e v 0.2% prior; Y/Y: 0.9%e v 0.9% prior; PCE Deflator Y/Y: 1.9%e v 1.6% prior
- 8:30 (US) Mar Personal Spending: 0.5%e v 0.7% prior; Personal Income: 0.4%e v 0.3% prior
- 9:00 (BE) Belgium Q1 Preliminary GDP Q/Q: No est v 0.5% prior; Y/Y: No est v 2.0% prior
- 9:30 (BR) Brazil Mar Primary Budget Balance (BRL): 12.1Be v 7.9B prior; Nominal Budget Balance: -6.8Be v -11.2B prior; Net Debt % GDP: 39.9%e v 39.9% prior
- 9:45 (US) Apr Chicago Purchasing Manager: 68.2e v 70.6 prior
- 9:55 (US) Apr Final University of Michigan Confidence: 70.0e v 69.6 prior
- 10:00 (US) Apr NAPM-Milwaukee: 63e v 66 prior
- 11:00 (US) Fed to purchase $5-7B in Notes/Bonds
- 12:00 (CO) Colombia Mar Urban Unemployment Rate: 12.3%e v 13.2% prior
- 12:30 (US) Fed Chairman Bernanke speaks at Fed Community-Affairs
- 13:00 (MX) Mexico Central Bank Monetary Policy Minutes
- 15:00 (AR) Argentina Mar Construction Activity M/M: No est v 1.3% prior; Y/Y: No est v 13.4% prior

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TradeTheNews.com Asian Market Update: Singapore unemployment rate falls to multi-month low; USD/CNY set at fresh yuan high

***Economic Data***
- (CH) CHINA APR HSBC MANUFACTURING PMI: 51.8 V 51.8 PRIOR
- (SI) SINGAPORE Q1 PRELIM UNEMPLOYMENT RATE: 1.9% V 2.0%E (multi-month low)
- (KS) SOUTH KOREA MAR INDUSTRIAL PRODUCTION M/M: 1.4% V 2.4%E; Y/Y: 8.7% V 11.0%E; MANUFACTURING Y/Y: 9.0% V 9.3% PRIOR
- (NZ) NEW ZEALAND MAR TRADE BALANCE (NZ$): 464M V 200ME (10-month high)
- (AU) AUSTRALIA MAR PRIVATE SECTOR CREDIT M/M: 0.6% V 0.4%E (matches highest level since Sept 2008); Y/Y: 3.6% V 3.3%E
- (KS) SOUTH KOREA MAR LEADING INDEX Y/Y: 1.6% V 2.4% PRIOR
- (KS) SOUTH KOREA MAR SERVICE INDUSTRY OUTPUT Y/Y: 0.7% V 0.1% PRIOR
- (NZ) NEW ZEALAND MAR MONEY SUPPLY M3 Y/Y: 5.6% V 5.2% PRIOR
- (SI) SINGAPORE MAR M1 MONEY SUPPLY Y/Y: 20.6% V 18.3%; M2 Y/Y: 8.7% V 8.7% PRIOR
- (SI) SINGAPORE MAR CREDIT CARD BAD DEBTS (S$) 14.6M V 13.7M PRIOR; BILLINGS: 2.9B V 2.4B PRIOR; BANK LOANS & ADVANCES Y/Y: 19.9% V 17.4% PRIOR

***Markets Snapshot (as of 04:30GMT)***
- Nikkei225 closed
- S&P/ASX -1.4%
- Kospi -1.1%
- Taiex -0.7%
- Shanghai Composite +0.1%
- Hang Seng -0.5%
- Straits Times Index -0.3%
- Jun S&P Futures -0.1% at 1,354
- Spot Gold -0.1% at $1,533/oz
- June Crude -0.3% at $112.50
- June Copper -0.4% at $4.23

***FX USD Majors Session Range***
- EUR/USD: 1.4848-1.4804
- GBP/USD: 1.6665-1.6625
- USD/CHF: 0.8750-0.8723
- USD/CAD: 0.9529-0.9500
- AUD/USD: 1.0942-1.0882
- NZD/USD: 0.8053-0.8002
- USD/JPY: 81.65-81.47

***Overview/Top Headlines***
- Markets were mixed mostly to the downside, lingering concerns on how China will deal with their mounting inflation and a possible rate or RRR hike. Nikkei225 was closed for holiday, Shanghai Composite was the only market that ventured into positive territory. ASX fell 1.4% as the AUD continued its rise almost hitting $1.0950. Crude and Brent both fell 0.3%, spot gold traded in a tight range, silver touched $48.50. China April HSBC Manufacturing PMI was flat m/m at 51.8, however Input costs fell to an 8-month low. For the second day in a row the PBoC set a new yuan high since the July 2005 revaluation at 6.4990 v 6.5015 prior close, this is also the first time below 6.50 since 1993.

- New Zealand March trade balance came in at a 10-month high at NZ$464M v 200Me. Both imports and exports came in stronger than expected and significantly higher than prior month. NZD/USD tested $0.8050, rising 25 pips on the news. Chinese press citing China State Researcher Wei Jianguo: Domestic inflation is not due to excessive money supply; Further tightening will not slow inflation.

- Some of the major Korean names reported today, Samsung Electronics was slightly weaker than expectations with Net profit KRW2.8T v KRW2.9Te and Rev KRW37.0T v KRW31Te, shares fell 1.8%. Samsung noted that it does expected conditions to remain challenging in Q2, not expecting much impact from Japan's supply chain issues. Kia Motors sees huge difficulties if USD/KRW falls below 1,000 won/dollar, expecting to pass sales target of 2.43M units in 2011. Results were strong, Net profit KRW953B v KRW499B y/y and Rev KRW10.7T v KRW7.8T y/y.

***Speakers/Geopolitical/In the press***
- JGB: (JP) Japan PM Kan: Reconstruction bonds are an attractive option for funding
- (JP) According to a Nikkei News survey, about 60% of Japan's 45 prefecture governors are not satisfied with PM Kan's response to earthquake/tsunami
- (JP) Japan Center for Economic Research: March GDP likely fell about 3.3% m/m - the biggest drop in 17 years - Nikkei News

***Equities***
- Cosco: 1919.HK: Reports Q1 Net loss CNY503.3M v loss CNY617Me
- FGL.AU: 98.6% of shareholders vote in favor for the Treasury Wine Estate demerger
- MQG.AU: Reports FY10 Net profit A$956M v A$944Me; Rev A$7.64B v A$7.7Be
- China Steel Corp: Reports Q1 Net profit NT$6.68B v NT$11.1B y/y, Rev NT$56.5B v NT$53.2B y/y

***US Equities***
- NTGR: Reports Q1 $0.65 v $0.52e, R $278.8M v $256Me; +16.9% after hours
- SWKS: Reports Q2 $0.41 v $0.39e, R$325.4M v $317Me; +13.7% after hours
- CSTR: Reports Q1 $0.46 (unclear of comp) v $0.22e, R$424M v $409Me; Raises FY11 guidance; +8.6% after hours
- RIMM: Guides Q1 EPS $1.30-1.37 v $1.48e, Rev slightly below prior $5.2-5.6B range v $5.4Be ($1.47-1.55 prior guidance), Cites smartphone sales; -11.1% after hours

***FX/Fixed Income/Commodities***
- (CH) China Iron and Steel Association's (CISA): Expects demand to rise 2.6%-4.6% per year from 2011-2015; Controlling excess capacity is a big factor facing the industry

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TradeTheNews.com Market Internals update

- NYSE volume 665M shares, about 6% below its three-month average; advancers lead decliners by 1.4:1.
- NASDAQ volume 1.59B shares, about 1% below its three-month average; advancers lead decliners by 1.1:1.
- VIX index -5% at just over 14.00

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TradeTheNews.com Market Internals update

- NYSE volume 500M shares, about 8% below its three-month average; advancers lead decliners by 1.1:1.
- NASDAQ volume 1.23B shares, about 1% below its three-month average; decliners lead advancers by 1.2:1.
- VIX index -3% at just over 14.00

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TradeTheNews.com Market Internals update

- NYSE volume 350M shares, about 8% below its three-month average; advancers lead decliners by 1.1:1.
- NASDAQ volume 845M shares, about 2% below its three-month average; decliners lead advancers by 1.3:1.
- VIX index -4% at just over 14.00

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TradeTheNews.com US Market Update

Dow +35 S&P +2.7 NASDAQ +1
**Economic data***
- (BR) Brazil Apr FGV Inflation IGP-M M/M: 0.5% v 0.6%e; Y/Y: 10.6% v 10.7%e
- (BR) Brazil COPOM Monetary Policy Meeting Minutes
- (CL) Chile Mar Industrial Production Y/Y: 30.9% v 23.0%e v 1.9% prior; Industrial Sales Y/Y: 19.7% v 12.9%e
- (CL) Chile Mar Total Copper Production: 450.5K v 368.2K tons
- (CL) Chile Mar Retail Sales Y/Y: 16.4% v 16.8% prior
- (US) Mar Chicago Fed National Activity Index: 0.26 v 0.50e
- (US) Q1 Advanced GDP QoQ (Annualized): 1.8%% v 2.0%e; Personal Consumption: 2.7% v 2.0%e
- (US) Q1 Advanced GDP Price Index: 1.9% v 2.3%e; Core PCE Q/Q: 1.5% v 1.3%e
- (US) Initial Jobless Claims: 429K v 395Ke; Continuing Claims: 3.641M v 3.68Me
- (US) Mar Pending Home Sales M/M: 5.1% v 1.5%e; Y/Y: -11.5v -9.3% prior
- (US) Weekly EIA Natural Gas Inventories: +31 bcf vs. +35 bcf to +45 bcf expected range

- US equity markets opened flat to slightly lower but have managed to move higher despite some mixed economic data. Stocks are attempting to consolidate and add to yesterday's gains after the Fed Chairman's press conference signaled, at least initially, the all clear to investors who want to continue to gobble up risk investments. Yesterday afternoon equity and commodity markets reached new yearly and all time highs while the US dollar sank, and that trend has continued into today. The surprising uptick in this morning's weekly initial jobless claims is having little effect, as many have suggested waiting until next week to get a better picture due to Easter holiday. The first look at Q1 GDP missed consensus expectations but came right in line with several private forecasts and where Chairman Bernanke noted the Fed had expected it to. Consumption jumped 2.7%, well above consensus, suggesting consumer spending has held up well in Q1 despite higher food and energy prices especially late in the quarter. Crude is holding $113 while gold remains at fresh all time highs above $1535 and silver gains another 7% as it chugs towards all time highs near $50. Copper prices have been a noticeable laggard over the last several sessions and are lower once again today. Treasury markets remain bid with yields at their lowest levels in about a month. The 10-year is testing 3.3% while the long bond is drifting back towards 4.4%. The 5-year TIPS breakeven is up marginally above 285 basis points, but overall inflation expectations are not moving while fed fund futures are indicating the Fed won't likely begin hiking rates until Q2 2012.

- Shares of Aetna are posting healthy gains after raising guidance with their Q1 earnings report. Managed care names are up across the board. The gains are not just in health insurance either. Aflac and Allstate also reported and those names are up 5% bring bids into the sector as a whole.

- There are a few pockets of weakness in tech holding back the NASDAQ. Flextronics is off more than 5% missed Q4 consensus top and bottom line estimates and guided Q1 sales below expectations as well. Shares of Akamai are sliding 15% and just meeting Q2 consensus and offering disappointing guidance.

- The USD managed to recover the bulk of its Asian/European session losses ahead of the Q1 GDP data but headwinds remained for the greenback. The GDP came in just shy of consensus expectations while initial jobless claims registered its highest level in three months. The GDP data also revealed that that ex-inventories the US economy grew by 0.8% which was slowest since Q3 2009. The weaker GDP print likely reinforced the Fed's easier policy, which helped precious metals to push higher. EUR/USD firmly back above the 1.48 level while USD/JPY slipped below the 81.50 level. IMF commented that it was planning to review the Greece strategy on fiscal situation and would study the country's debt sustainability at the early may review.
- Brazil COPOM Monetary Policy Meeting Minutes noted that inflation outlook had not evolved favorably since last meeting; Rate hike cycle to be 'sufficiently prolonged'

- Global View D.O.G. (Dollar, Oil, Gold) Index was at .4935 and lower by 0.20% from its Wednesday close

**Looking Ahead***
- 11:00 (US) Fed to purchase $5-7B in Notes/Bonds
- 13:00 (US) Treasury to sell $29B in 7-Year Notes

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TradeTheNews.com Market Internals update

- NYSE volume 195M shares, about 10% below its three-month average; advancers lead decliners by 1.1:1.
- NASDAQ volume 450M shares, about 4% below its three-month average; decliners lead advancers by 1.3:1.
- VIX index -1.5% at just over 15.00

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TradeTheNews.com European Market Update: USD bears feel confident that the Fed gave the green light for continued benign neglect

***Economic Data***
- (FI) Finland Q1 House Prices Q/Q: 1.0% v 0.2%e
- (FI) Finland Mar Preliminary Retail Sales Volume Y/Y: 2.1% v 2.1%e
- (FI) Finland Mar Unemployment Rate: 9.3% v 8.4%e
- (GE) Germany Mar Import Price Index M/M: 1.1% v 1.1%e; Y/Y: 11.3% v 11.3%e
- (GE) Germany Mar ILO Employment: 40.6M v 40.6M prior; Unemployment rate: 6.5% v 6.3% prior
- (IN) India Primary Articles WPI w/e Apr 16th Y/Y: 12.1% v 12.0% prior; Food Articles WPI Y/Y: 8.3% v 8.7% prior
- (FR) France Mar Consumer Spending M/M: -0.7% V 0.2%e; Y/Y: 2.6% V 3.7%e
- (RU) Russia Gold & Forex Reserve w/e Apr 22nd: $517.9B v $512.8B prior
- (HU) Hungary Mar Unemployment Rate: 11.6% V 11.5%e
- (SA) South Africa Feb Leading Indicator: 136.1 v 134.7 prior
- (SP) Spain Feb Mortgages-capital loaned Y/Y: -17.7% v -21.0% prior; Y/Y: -8.8% v -7.9% prior
- (SW) Sweden Apr Consumer Confidence: 17.6 v 17.5e; Economic Tendency: 109.8 v 112.0e
- (SW) Sweden Q1 Manufacturing Confidence: 7 v 12e
- (SW) Sweden Mar PPI M/M: 0.0% v 0.4%e; Y/Y: 1.7% v 2.1%e
- (SW) Sweden Mar Trade Balance (SEK): 9.6B v 9.0Be
- (GE) Germany Apr Unemployment Change: -37K v -37Ke; Unemployment Rate: 7.1% v 7.0%e
- (IT) Italy Apr Business Confidence: 103.0 v 103.5e
- (HK) Hong Kong Mar Trade Balance (HKD): -40.1B v -36.6Be; Exports Y/Y: 21.5% v 20.4%e; Imports Y/Y: 18.8% v 18.4%e
- (GR) ECB end-Feb funding to Greek banks at €90.4B v €94.4B m/m
- (IC) Iceland Apr CPI M/M: 0.8% v 1.0% prior; Y/Y: 2.8% v 2.3% prior
- (BE) Belgium Apr CPI M/M: 0.3% v 0.5% prior; Y/Y: 3.4% v 3.5% prior
- (SA) South Afrca Mar PPI M/M: 0.9% v 0.6%e; Y/Y: 7.3% v 7.2%e
- (IR) Ireland Mar Retail Sales Volume M/M: 0.1 v 3.1% prior; Y/Y: -1.7 v -0.6% prior
- (SP) Spain Feb Total Housing Permits M/M: 21.9% v -14.8% prior; Y/Y: 3.6% v 4.6% prior
- (IS) Israel Feb Unemployment Rate: 6.0% v 6.1% prior

Fixed Income
- (IT) Italy Debt Agency (Tesoro) sold approx €6.6B vs. €5.0-7.0B in 2014 and 2021 Bonds
- Sold €3.21B vs. €2.5-3.5Be in 3.0% Apr 2014 BTP; Avg Yield 3.45% v 3.24% prior; Bid-to-cover: 1.58x v 1.3x prior
- Sold €3.35B vs. 2.5-3.5Be in 4.75% Sept 2021 BTP; Avg Yield 4.84% v 4.80% prior; Bid-to-cover: 1.41x v 1.50x prior
- Sold €3.5B vs. €2.5-3.5Be indicated in Floating 2018 CCT, Avg Yield 2.89%
- HU) Hungary Debt Agency (AKK) sold HUF60B in 12-Month Bills; Avg Yield 5.93% v 5.98% prior

*** SPEAKERS/FIXED INCOME/FX/COMMODITIES/ERRATUM ***
***Notes/Observations:
- BOJ Interest left the Target Rate Range unchanged between 0.0% to 0.10%; As expoected
- RBNZ unchanged with a dovish tint
- Fed Chairman Bernanke signals no rush to normalize policy. USD softer across the board as dollar bears believe they have been given the green light

Equities:
FTSE 100 +0.10% at 6091, DAX +0.50% 7438, CAC 40 +0.70% at 4095, IBEX 35 +1% at 10845, FTSE MIB +0.60% at 22370, SMI +0.30% at 6494

- European shares rose again today supported by Fed's speech and good corporate earnings. During its historic press conference Fed's Bernanke pledged that the central bank would maintain its monetary stimulus in contrast with ECB and other central banks. As expected Fed left the target rate unchanged but Bernanke also confirmed that it would keep balance sheet stable at end of QE 2 program and reinvest assets. Wall Street cheered the support as fears that Bernanke may signal the end of an expansionary monetary policy dissipated. Investors will eye US GDP today due during early morning. European corporate earnings were strong today adding further support to the rally.
- Deutsche Bank [DB1.GE] topped estimates buoyed especially by divisions of Private Clients and Asset and Wealth Management supported significantly by Postbank. Investment banking had also raised on a yearly basis. Shares rallied as bank reiterated its outlook. Royal Dutch Shell [RDSA.UK] also gained on the FTSE100 after reporting strong results. The output was slightly lower but the decrease at 4% was alarming than its peer BP. Bayer [BAYN.GE] gained over 1.5% after surpassing estimates and raising outlook for FY11.
- Among the decliners was SAP [SAP.GE], dropping over 5% after reporting lower than expected results and weaker margins on a sequential basis. The decrease was primarily attributed to costs related to the acquisition of SybaseHowever, the company reaffirmed its forecast and the CEO noted that the Q1 was generally a weak quarter. Unilever [UNA.NV] also dropped around 3.5% after missing estimates and announcing that movement in underlying operating margin to be down in H1 before improving in H2 2011

Speakers:
- (JP) BOJ semi-annual Economic Outlook noted that Japan's economy to remain under strong downward pressure, mainly on output, for time being. The BOJ cut its FY11 GDP view to 0.6% from 1.6% prior but did raise FY12 GDP forecast to +2.9% from 2.0% prior Jan view. It raise both FY11 and FY12 core views to 0.7% versus 0.3% and 0.6% views previously
- IMF commented in its regional report that China's inflation was close to peaking and would slow in H2 of the year towards the range of 4.0% to 4.5%. Thus it view as that inflation to increase further in 2011 before decelerating modestly in 2012 for the region. It noted that it was premature to say that China's economy was overheating but pockets of overheating had emerged across parts of the Asian region. It was important for China maintained a prudent monetary policy stance as the need to tighten macroeconomic policies has become more pressing. Interest rates were below levels consistent with stable growth and low inflation as high commodity prices have spilled over into core inflation and expectations
- BOJ Gov Shirakawa commented at his post rate decision press conference that the BOJ expected exports and production to rebound in H2 of the year but cautioned it needed to watch the downside economic. He stressed that the BOJ to take appropriate steps if necessary but had no comment whether BOJ would directly purchase JGBs if approved by parliament. Lastly he noted that it was unlikely that prices would keep rising given the current gap between demand and supply
- BoE Sentence reiterated his long-standing hawkish tone on UK interest rates. He again noted that the BOE should NOT for 'red signal' before increasing interest rates and stressed need for gradual rate hikes
- ECB Mersch reiterated view that non-standard measures are temporary and to be withdrawn at an appropriate pace
- China Premier Wen reiterated G20's view for its distaste in using all forms of protectionism and added that he sought a balance on global trade
- EU Commissioner De Gucht commented that China's export credits were hurting European businesses
- The German Institute for Economic Research (DIW) forecasted first and second quarter GDP at 0.9% and 0.6%, respectively. This compares with the German Minister of Finance's first quarter GDP estimate of 0.75%.

Currencies/Fixed income:
- Following the FOMC rate decision and Bernanke press conference the soft tone of the USD has been the markets' obsession with further downside in focus for the greenback. The Dollar Index fell to the lowest since 2008 below 73.04 level. For the most part the risk appetite theme remained appropriate after the FOMC signaled that it would maintain its record monetary stimulus after ending large-scale bond purchases in June. The EUR/USD was higher by over 50 pips from its Asian open hovering around the mid-1.48 handle during the session.

Geo-Political/ In the Papers:
- The Bank of Japan semi-annual economic outlook reported that attention must be paid to the downside economic risks. There is high degree of uncertainty regarding how the recent disasters will affect the economy, including its possible affects on corporate and household growth expectations. The outlook broadly raised inflation estimates for the country including the current year core CPI to 0.7% from the January view of 0.3%. The report also cut the growth forecast for the year to 0.6% (1.6% prior) though raise next year forecast to 2.9% (2.0% prior). The economic recovery is seen to accelerate from October.

***Looking Ahead***
- (BR) Brazil Mar Central Govt Budget (BRL): 8.4Be v 2.6B prior
- 7:00 (BR) Brazil Apr FGV Inflation IGP-M M/M: 0.6%e v 0.6% prior; Y/Y: 10.7%e v 11.0% prior
- 7:30 (BR) Brazil COPOM Monetary Policy Meeting Minutes
- 8:00 (CL) Chile Mar Industrial Production Y/Y: 23.0%e v 1.9% prior; Industrial Sales Y/Y: 12.9%e v 3.8% prior
- 8:00 (CL) Chile Mar Total Copper Production: No est v 368.2K tons
- 8:00 (CL) Chile Mar Retail Sales Y/Y: No est v 16.8% prior
- 8:30 (US) Fed's Williams speaks at Community Affairs Conference
- 8:30 (US) Mar Chicago Fed National Activity Index: +0.50e v -0.04 prior
- 8:30 (US) Q1 Advanced GDP QoQ (Annualized): 2.0%e v 3.1% prior; Personal Consumption: 2.0%e v 4.0% prior
- 8:30 (US) Q1 Advanced GDP Price Index: 2.3%e v 0.4% prior; Core PCE Q/Q: 1.4%e v 0.4% prior
- 8:30 (US) Initial Jobless Claims: 395Ke v 403K prior; Continuing Claims: 3.68Mev 3.695M prior
- 10:00 (US) Mar Pending Home Sales M/M: 1.5%e v 2.1% prior; Y/Y: No est v -9.3% prior
- 10:30 (US) Weekly EIA Natural Gas Inventories
- 11:00 (US)Fed to purchase $5-7B in Notes/Bonds
- 13:00 (US) Treasury to sell $29B in 7-Year Notes

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TradeTheNews.com Asian Market Update: Japanese data shows impact of quake and tsunami; New Zealand and Japan holds rates as expected

***Economic Data***
- (JP) BANK OF JAPAN (BOJ) LEAVES TARGET RATE RANGE UNCHANGED BETWEEN 0.0% TO 0.10%; (AS EXPECTED
- (JP) JAPAN MAR PRELIM INDUSTRIAL PRODUCTION M/M: -15.3% V -10.6%E (record drop); Y/Y: -12.9% V -8.5%E; METI downgrades assessment of industrial output (first cut since Sept 2010)
- (NZ) RESERVE BANK OF NEW ZEALAND (RBNZ) LEAVES OFFICIAL CASH RATE UNCHANGED AT 2.50% (AS EXPECTED)
- (JP) JAPAN MAR NATIONAL CPI Y/Y: 0.0% V 0.0%E; CORE Y/Y: -0.1% V -0.1%E (23-month high); APR TOKYO CPI Y/Y: -0.1% V 0.0%E; TOKYO CORE Y/Y: 0.2% V 0.2%E (2-year high)
- (JP) JAPAN MAR JOBLESS RATE: 4.6% V 4.8%E; JOB-TO-APPLICANT RATIO: 0.63 V 0.60E
- (JP) JAPAN APR MARKIT/JMMA MANUFACTURING PMI: 45.7 V 46.4 PRIOR (2-year low)
- (KS) SOUTH KOREA MAR CURRENT ACCOUNT: $1.4B V $1.2B PRIOR; GOODS BALANCE: $2.9B V $1.6B PRIOR
- (JP) JAPAN MAR HOUSING STARTS Y/Y: -2.4% V -1.1%E (first decline in 10 months); ANNUALIZED HOUSING STARTS: 807K V 814KE
- (JP) JAPAN MAR VEHICLE PRODUCTION Y/Y: -57.3% V -5.5% PRIOR
- (JP) JAPAN MAR OVERALL HOUSEHOLD SPENDING Y/Y: -8.5% V -7.0%E (multi-year low)
- (UK) GFK APR CONSUMER CONFIDENCE SURVEY: -31 V -27E (lowest level since Feb 2009)
- (HK) Hong Kong Monetary Authority (HKMA) keeps base rate at 0.50%, As Expected
- (JP) Japan investors sold ¥172B in foreign bonds last week v ¥226B bought in prior week

***Markets Snapshot (as of 04:30GMT)***
- Nikkei225 +1.4%
- S&P/ASX +0.4%
- Kospi +0.1%
- Taiex -0.3%
- Shanghai Composite -0.1%
- Hang Seng +0.5%
- Straits Times Index +0.4%
- Jun S&P Futures +0.3% at 1,354
- Spot Gold +0.4% at $1,531/oz
- June Crude +0.6% at $113.40
- June Copper +1.6% at $4.30

***FX USD Majors Session Range***
- EUR/USD: 1.4881-1.4771
- GBP/USD: 1.6746-1.6622
- USD/CHF: 0.8760-0.8689
- USD/CAD: 0.9512-0.9465
- AUD/USD: 1.0948-1.0852
- NZD/USD: 0.8082-0.8021
- USD/JPY: 82.27-81.62

***Overview/Top Headlines***
- Markets started the day out positive after the Fed affirmed the US economy was continuing to recover and was in no hurry to tighten policy, however as the session went on markets dwindled into mixed territory. Dealers spotted buying of dollars from Malaysia, Singapore, Korea and Thai Central Banks as the EUR/USD rose to a fresh 16-month high above $1.48. AUD/USD also rose to a new 29-year high above $1.09 nearly breeching the $1.0950 level. Chinese press reported that yesterday's China B-Share decline is attributed to speculation on a new capital gains tax. An official from the China tax office said it was unlikely to implement a capital gains tax, B-Shares rose on the news. Japan's March industrial production and consumer spending dropped sharply to multi-year lows and housing starts fell for the first time in 10-months as the impact from last month's tsunami, earthquake and ongoing nuclear crisis makes its impact on the economy. Core national CPI reached at 23-month high at -9.1% y/y.

- As expected the Bank of Japan unanimously voted to leave the target rate range unchanged at 0.0%-0.1%. BoJ also finalized details on ¥1T funding to financial institutions in earthquake area setting a max of ¥150B for each bank. Will accept corporate bonds and loans from companies rated BBB or higher as collateral v A rated or higher prior. Deputy Gov Nishimura proposed expanding asset buying by ¥5T to ¥15T (current ¥10T); Voted down 1 to 8.

- Reserve Bank of New Zealand also left their official cash rate unchanged at 2.50% as expected as the economy continues to recover from the Christchurch earthquake. Comments: Given the outlook for core inflation and continued economic disruption, rates will stay at current level for some time. Headline inflation is currently being boosted by recent increases in indirect taxes.

- HKMA Chief Chan: Interest rate in Hong Kong could rise before the US; Loan rates have room to rise due to strong demand. Chan expects capital outflows from Hong Kong to start when rates begin to increase. China PBoC's Deputy Gov Liu: Depth of China's market does not match economy; Financial markets need innovation and should explore new bond sales methods, China needs to push asset securitization and develop municipal bonds.

- China Daily citing Malaysia Deputy Fin Min Lim Chai: China should take the lead in formulating a single currency for Asia. A "unified currency in Asia, where most countries are emerging economies that might easily attract hot money inflows from industrialized nations, could help diminish the risk of exchange rate fluctuations and help boost the region's trade."

***Speakers/Geopolitical/In the press***
- (CH) China and Malaysia to sign 8 new bi-lateral agreements including economic cooperation, energy and education
- (PH) Philippines Central Bank Gov Tetangco: Keeping a close eye on inflation levels; Next policy adjustment will depend on economic data
- (JP) Japan Chief Cabinet Sec Edano: Not considering a tax increase at this point to fund reconstruction
- (KS) Bank of Korea (BoK) Gov Kim: Sees $1B current account surplus in 2011; April current account expected to fall slightly m/m due to dividend payments

***Equities***
- MCC.AU: Lifts force majeure, expects to be back to full production by the end of June; Revising production guidance
- Asustek Computer: 2357.TT: Reports Q1 Net N$3.4B v NT$3.6Be; Rev NT$58.3B v NT$74Be
- Hynix Semiconductor: 000660.KS: Reports Q1 Net profit KRW273.5B v KRW265Be; Op profit KRW322.8B v KRW265Be; Rev KRW2.79T v KRW2.6Te
- (JP) Tokyo Stock exchange: No decision has been made on when it will IPO
- Samsung SDI: 006400.KS: Reports Q1 Net KRW78.7B v KRW72Be, Rev KRW1.2T v KRW1.1Te
- NISTY: Reports FY10/11 Net ¥93.2BB v ¥102Be, Op Profit ¥165B v ¥171Be, Rev ¥4.1T v ¥4.1Te

***US Equities***
- EBAY: Reports Q1 $0.47 v $0.46e, R$2.55B v $2.5Be; +0.2% after hours
- AKAM: Reports Q1 $0.38 v $0.37e, R$276M v $272Me; -11.1% after hours
- RPC: Clinical Trial Data Confirms Onko-Sure Plus CEA Analysis Is an Improved Alternative for Detecting Colorectal Cancer; +45.2% after hours
- SBUX: Reports Q2 $0.34 v $0.34e, R$2.79B v $2.7Be; -1.7% after hours

***FX/Fixed Income/Commodities***
- (CH) PBoC sells CNY11B in 3-month bills at 2.9168% v 2.9168 prior
- USD/CNY: (CH) PBoC sets yuan mid point at 6.5051 v 6.5112 prior close (new yuan high since July 2005 revaluation)
- SLV: iShares Silver Trust ETF daily holdings fall 3% to 11,053 tons from 11,252 tons

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TradeTheNews.com Market Internals update

- NYSE volume 660M shares, about 7% below its three-month average; advancers lead decliners by 1.3:1.
- NASDAQ volume 1.64B shares, about 2% above its three-month average; advancers lead decliners by 1.3:1.
- VIX index -1% at just over 15.00

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