Aust Dollar Treads Water Before RBA

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The Australian dollar is treading water as markets await the Reserve Bank’s board meeting, where interest rates are expected to remain on hold.

At 7.00am (AEDT) on Tuesday, the local unit was trading at US71.37c, down fractionally from US71.38c on Monday.

Nomura rate strategist Andrew Ticehurst says the RBA will be reluctant to use up some of its remaining “ammunition”.

 “The RBA is uncertain that a rate cut could actually achieve a meaningful result and is not yet convinced that the economy requires more policy support,” he said.

Source: Markets Spectator

Oil Rises to Seven-Week High as Saudis to Work With Producers

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Crude closed at the highest in seven weeks as Saudi Arabia said it would work with other producers to curb market fluctuations and China’s central bank stepped up efforts to support the economy.

West Texas Intermediate oil increased 3 percent. Saudi Arabia wants a stable oil market, according to state-run Saudi Press Agency. China reduced the amount of cash the nation’s lenders must lock away. The Organization of Petroleum Exporting Countries reduced production by 79,000 barrels a day this month, according to a Bloomberg survey.

Prices slipped to a 12-year low on Feb. 11 in New York amid speculation a worldwide surplus will be prolonged with U.S. crude stockpiles at the highest level in more than eight decades and the outlook for increased exports from Iran. A proposal to freeze output by Saudi Arabia and Russia is achievable and prices may rise to as high as $50 a barrel by the end of the year, Nigerian Minister of State for Petroleum Resources Emmanuel Ibe Kachikwu told CNBC.

WTI for April delivery rose 97 cents to $33.75 a barrel on the New York Mercantile Exchange. It was the highest close since Jan. 6. Prices advanced 0.4 percent in February, the first monthly gain since October.

Brent for April settlement increased 87 cents, or 2.5 percent, before expiring at $35.97 a barrel on the London-based ICE Futures Europe exchange. Brent closed at a $2.22 premium to WTI, after reaching an 11-week high of $2.86 on Feb. 26. The more-active May contract climbed 3.2 percent to $36.57.

Source: Bloomberg

Hong Kong Shares Fall More Than 1 pct, Track Mainland Stocks (Riview)

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Hong Kong shares fell more than 1 percent on Monday, with sentiment soured by a tumble in mainland stocks.

The Hang Seng Index dropped 1.3 percent, to 19,111.93, while the China Enterprises Index lost 1.5 percent, to 7,916.34 points.

China stocks slumped more than 2 percent, closing at their lowest in a month, as investors sold on fears that rising real estate prices will cannibalise funds from shares, aggravated by disappointing earnings from small-cap growth stocks on the ChiNext index.

Source : Reuters

S&P 500 Falls for a Third Month as Late-February Rebound Fades

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The Standard & Poor’s 500 Index erased a February gain Monday, despite a rally in crude oil, as a two-week rebound faltered in the month’s lightly traded final session.

The S&P 500 fell 0.8 percent to 1,932.03 at 4 p.m. in New York, extending its monthly losing streak to three, the longest in more than four years. It closed 0.4 percent lower for February. Afternoon declines accelerated as the gauge fell below its average price during the past 50 days. The benchmark hasn’t declined on a day when oil climbed that much since Nov. 23.

The S&P 500 halted a two-day advance on Friday after signs of firming inflation spurred speculation interest rates may rise sooner than previously expected. A bank-fueled rebound of more than 6.5 percent since a Feb. 11 through last week had briefly erased the benchmark’s losses for the month.

Investors are also watching economic releases to gauge the trajectory of rate increases, before the Federal Reserve’s next decision on March 16. Data today showed contracts to purchase previously owned homes unexpectedly dropped in January by the most in two years. A February gauge on manufacturing in the Chicago area today also fell more than forecast.

After last week’s batch of data, traders raised their bets for further Fed rate increases this year. The probability of a June boost is 32 percent, up from 27 percent a week ago, while odds of a December move reached almost 54 percent after slipping to 11 percent at the height of this month’s stock selloff on Feb. 11.

Source: Bloomberg

U.S. Stocks Advance Toward Monthly Gain After Two-Week Rebound

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U.S. stocks advanced in February’s final session, showing some stability along with crude prices and poised for a monthly gain after a two-week rebound from the worst start to a year ever.

After fluctuating in early trading, equities extended a climb as oil rallied, with West Texas Intermediate crude up 2.8 percent. Even with the commodity rising, gains in energy producers were muted while raw-material and utilities shares, among this month’s best performers, were the strongest today.

The Standard & Poor’s 500 Index rose 0.4 percent to 1,956.47 at 12:21 p.m. in New York, on track for a 0.8 percent February advance and holding above its average price during the past 50 days. The Dow Jones Industrial Average gained 68.14 points, or 0.4 percent, to 16,708.11. The Nasdaq Composite Index added 0.6 percent.

China’s central bank today cut the amount of cash the nation’s lenders must hold as reserve, marking a return to more traditional easing after policy makers indicated in recent weeks they would spur growth by guiding interbank markets lower and injecting liquidity through open-market operations.

The S&P 500 halted a two-day advance on Friday after signs of firming inflation spurred speculation interest rates may rise sooner than previously expected. Still, a bank-fueled rebound of more than 6 percent since a Feb. 11 low has erased the benchmark’s losses for the month.

Source: Bloomberg