Wall Street falls for second day on financials and automakers down, USD weakens

Tuesday, May 12, 2009

US stocks are falling during its Today's session on Ford plans to issue 300 million shares and investors are digesting new chain-store sales and foreign trade. The Greenback is weak against its major rival despite lower US stocks may help Dollar.

Down jones is falling 0.42% so far today, Nasdaq drops 1.81%, NYSE is declining 0.88% and the S&P 500 is flirting with the 900 pts level as it is losing 0.89% so far today.

After reaching 7-week high at 1.3707, the EUR/USD has fallen around 100 pips to test the 1.3600 level. The pair has lost almost all it initial daily gains and currently the pair is rising 0.10% so far today from opening price.

GBP/USD is rising 0.70% so far today and it is trading around 1.5230 after reaching 4-month high at 1.5330. USD/JPY has reached a fresh May low at 96.35 after falling 150 pips from 97.85, intra-day high in the early European session. Currently the pair is falling around 1.20 so far today from 97.60 opening price action to the currently 96.45.

USD/CHF is testing the 1.1090 resistance level, but it remains in the down field, currently the pair is falling 0.20% so far today from opening price.

"U.S. data also come out better than expected, as Trade deficit widen less than expected to -27.6B. Wall Street opened to the upside, but was unable to hold gains and fell sending a mixed message after a two-month rally. Euro and Gbp continued firming up, although far from early highs. Euro now at 1.3646 from 1.3707, and Gbp 1.5251 from 1.5352. As we have been mentioning, currencies are tending to detach from stocks, yet process is just beginning. Keep an eye on stocks, but don’t ignore self situation for each currency. Expect some correction and consolidation before majors resume bullish trend against dollar."

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