Daily Market Outlook

Currencies

• EUR/USD The U.S. dollar traded 0.4 percent from a two-week low against the euro before data today forecast to show the U.S. economy expanded at the slowest pace in a year.
  • The U.S. dollar was little changed at $1.2276 per euro as of 9:46 a.m. in Tokyo from the close in New York yesterday, when it touched $1.2330, the weakest since July 10. It has fallen 1 percent this week. The greenback fetched 78.22 yen from 78.21, set for a 0.3 percent loss since July 20. The euro traded little changed at 96.03 yen, after yesterday climbing 1.1 percent, the sharpest advance since June 29.

• GBP/USD The Sterling rose the most against the dollar since December 2010 on optimism European policy makers will step up efforts to contain the debt crisis, improving the outlook for the U.K. economy.
  • The U.K. pound rose 1.2 percent to $1.5690 at 4:21 p.m. London time after climbing as much as 1.5 percent, the biggest intraday gain since Dec. 31, 2010. The U.K. currency appreciated 0.1 percent to 78.38 per euro. It advanced to 77.55 pence on July 23, the strongest level since October 2008.

• USD/CAD  The Canadian dollar climbed to the strongest since May versus its U.S. counterpart after European Central Bank President Mario Draghi’s comments about preserving the 17-nation currency sparked a rally in higher-risk assets.
  • Canadian Dollar currency (loonie), gained as much as 0.9 percent, the most this month, and advanced to C$1.0102 per U.S. dollar at 5 p.m. in Toronto, touching the strongest since May 16. One Canadian dollar buys 99.01 cents

Commodities

• Oil rose from the highest close in almost a week in New York after the head of the European Central Bank predicted the euro will survive and reports signaled improving economic prospects in the U.S. and China.
  • Oil for September delivery rose as much as 26 cents to $89.65 a barrel in electronic trading on the New York Mercantile Exchange (NYMEX) and was at $89.65 at 11:05 a.m. Singapore time. The contract climbed 0.5 percent yesterday to $89.39, the highest close since July 20. Prices are down 2 percent this week and 9.3 percent lower this year.

• Gold Gold dropped to 1.74 million ounces from 1.98 million ounces a year earlier. Stephen Walker, an analyst at RBC Capital Markets in Toronto, estimated output at 1.84 million ounces while Stifel Nicolaus’s Topping predicted 1.78 million ounces.
  • Spot Gold averaged $1,613 on the Comex in New York in the quarter, 7 percent higher than a year earlier. Prices have posted 11 consecutive annual gains. Gold rose 38 percent to $613 an ounce from $445 a year earlier. Topping estimated $564.

Equities

• Asian stocks rose for a second day, with the regional benchmark index paring its weekly loss, after European Central Bank President Mario Draghi said policy makers will do whatever is needed to preserve the euro.
  • The MSCI Asia Pacific Index (MXAP) rose 0.9 percent to 114.87 as of 10:10 a.m. in Tokyo before markets in Hong Kong and China opened. About six stocks advanced for each that fell on the measure, which has lost 1.5 percent this week.

• European stocks climbed the most in almost a month, halting a four-day selloff, after European Central Bank President Mario Draghi said policy makers will do whatever it takes to preserve the euro.
  • The Stoxx Europe 600 Index (SXXP) jumped 2.5 percent to 256.58 at the close of trading, for its biggest gain since June 29. The gauge had dropped 4.4 percent the previous four sessions as a surge in Spanish bond yields above 7 percent reignited concern that Europe’s debt crisis is yet to be contained.

• U.S stocks rose, Hope for a real solution to Europe’s ailing economy lifted U.S. stocks Thursday, after European Central Bank president Mario Draghi said the central bank would do whatever it takes to preserve the euro.
  • The S&P 500 (SPX) rose and added 22 points, or 1.7%