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Hitt og þetta 23. ágúst 2006

DJ EUROPEAN MORNING BRIEFING: US Rate Hike Fears Resurface


(This repeats an item published at 0500 GMT)
US SUMMARY: Fed Officials Warning Reverses Shares

DJIA 11339.84 loss 5.21 dn 0.1%
NASDAQ 2150.02 gain 2.27 up 0.1%
S&P 500 1298.82 gain 1.30 up 0.1%
Dow Future 11363.00 gain 5.00 0.0%
NASDAQ Future 1566.75 gain 0.25 0.0%
S&P Future 1302.25 gain 0.25 0.0%
Euro-USD 1.2358 gain 0.0008 up 0.06%
10-Yr US Treasury: 4.82% unchanged
(Futures values, Treasury, EUR/USD Data as of 0450 GMT)
A Federal Reserve official's warning about a possible resumption of interest rate hikes unnerved Wall Street Tuesday, wiping out an early advance and leaving stocks mixed by the close. The dollar, Treasurys and oil rose.

STOCKS: The comments by Chicago Fed President Michael Moskow rattled investors looking to revive last week's rally after they collected profits on Monday. Retailers, along with other sectors dependent on consumer spending, were among the stocks causing the major indexes to wobble Tuesday.

The Fed left interest rates unchanged earlier this month after raising them 17 straight times. Wall Street has rallied since then on hopes this would be the end, but one analyst said Moskow's comments could be "putting out a trial balloon" to gauge the market's reaction to a continuation of rate hikes.

"The market has discounted the likelihood of another rate increase by about a 20 percent chance for the next meeting" in September, said Scott Merritt, a U.S. equity strategist for JPMorgan Asset Management. "He might want to get that up to 50 percent to get more flexibility. If expectations get too high or low, (Fed Chairman Ben) Bernanke can't really go against it or he'll lose credibility."

The market initially ramped up after Iran's top nuclear negotiator committed to "serious negotiations" over its nuclear ambitions, giving hopes that Middle East tensions might ease. And gains from Advanced Micro Devices and XM Satellite Radio Holdings helped send technology stocks higher.

FOREX: The dollar opens slightly lower, after it climbed broadly versus its major rivals Tuesday, mounting a comeback as disappointing euro-zone data combined with comments from Fed officials to support the greenback ahead of a key U.S. housing report.

Investors are awaiting U.S. data on existing home sales in July, expected at 1400 GMT Wednesday.

"Clearly a weak housing number will once again bring out dollar bears who believe interest rates have peaked, but it really depends on how weak the numbers are," said John McCarthy, head of foreign exchange trading at ING in New York. "Will that number be big enough to take us above $1.29? I doubt it."

BONDS: Longer-term Treasury prices made modest gains Tuesday, moving back into positive territory late in the session after earlier retreating on tough inflation warnings from Fed officials.

Jack Guynn, the outgoing Federal Reserve Bank of Atlanta president, also weighed on Treasury prices.

Guynn reaffirmed the importance of keeping inflation pressures in check, saying "I'm sure future policymakers will remember the lessons we learned in the past 40 years about what happens when you start down the slippery slope of trading inflation for growth," he said. However, he later said he was "comfortable" with the current policy stance.

Guynn is a voter on the Federal Open Market Committee, though he is retiring in October.

"The message is simple: the market believes that the economy is weakening and that it is weakening sufficiently ... that the Fed will have to cut interest rates in response sometime in early 2007," said Tony Crescenzi, chief bond market strategist at Miller Tabak & Co. in New York.

OIL: New York crude oil futures rose 18 cents to $72.63 Tuesday as Iran's long-awaited answer to incentives for it to halt uranium enrichment was kept secret and neither the U.N. nor the U.S. made a public response.

"The Iran standoff is putting a bottom under prices," said Dominick Caglioti, a trader at MK Brokers in New York.

ASIAN SUMMARY: Worry Over Exports Keeps Shares Mixed

USD-Yen 116.38 loss 0.16 dn 0.1%
AUD-USD 0.7621 0.0000 0.00%
Nikkei 225 16188.00 gain 6.83 0.0%
Hang Seng 17102.38 loss 47.37 dn 0.3%
S&P/ASX 200 5062.60 gain 21.30 up 0.4%
Taiwan Index 6577.72 loss 12.48 dn 0.2%
S.Korea Kospi 1327.53 loss 7.43 dn 0.6%
JGB Yield 1.8050% up 0.0100
(All values as of 0450 GMT)
STOCKS: Asian stocks were mixed in cautious trading Wednesday, with investors moving to the sidelines ahead of key earnings announcements, although Japanese technology giants such as Canon showed modest gains.

"Regionwide we are seeing some softening of exports and that is likely to go through for the next six to 12 months," said Sean Darby, regional economist for Nomura International. "I think we are going to go back into more of steady state in terms of export growth, and certainly if Chinese authorities tighten any further that will start to weigh on inter-Asia regional trade."

FOREX: The yen gained on the dollar and euro on heavy selling by Japan's exporters, Tokyo traders say. Sell orders remain above Y116.80 and the euro has heavy resistance at Y149.50. Players are awaiting the U.S. housing data.

BONDS: Prices of Japan's government fell slightly after the latest Fed speakers sowed worry about interest rates once again. However, traders identified sellers as mostly from outside of Japan.

METALS: Spot gold fell $1.20 to $623.70/oz, under pressure from modest dollar gains. But as long as $620 holds, it's still on track for a tilt at $630 and $640 in coming sessions if geopolitical and energy outlooks back gold, says Sydney-based trader. LME copper chart patterns are starting to look weak. But the outlook depends on the Escondida labor settlement.

OIL: Prices dropped 20 cents to $72.909 Wednesday as traders waited for the weekly U.S. inventory report and locked in profits in response to Iran's offer to continue negotiations on its nuclear program.

EUROPEAN OUTLOOK: Stocks Called Slightly Lower

Euro-USD 1.2790 loss 0.0009 dn 0.07%
Stlg-USD 1.8874 loss 0.0002 dn 0.01%
USD-Franc 1.2358 gain 0.0008 up 0.06%
(All values as of 0450 GMT)
European shares are set to open slightly lower, with government debt little changed. The euro is likely to cling to recent levels around $1.2800.

STOCKS: European markets are likely to lose ground at the open, as investors ponder signals that the European economy is slowing down.

U.K. spreadbettor Cantor Index calls the FTSE down 5 points at 5897, the DAX down 18 at 5800, the CAC off 11 at 5117.

Futures on German 10-year bonds rose in the wake of the ZEW Institute's poll on economic sentiment Tuesday. "The increase in bund futures shows me that the economy will slow down," said Uwe Gerhardt, a sales trader at Close Brothers Seydler in Frankfurt. Gerhardt expects the value-added-tax rate hike of three percentage points planned for 2007 to affect growth in Germany, Europe's leading economy.

He said longer-term investors should buy if the DAX falls to around the 5,700 level, as interest rates might start falling.

European stocks finished Tuesday's session on a mixed note, as Continental markets recouped earlier losses after a positive start to trading in U.S. equity markets.

FOREX: The euro faces tough going above $1.2800 after persistent overnight selling. The euro only has slight support at around $1.2770. A break would trigger more selling, dealers said.

BONDS: The weak ZEW changes the picture for government debt, lending to support of prices. "It suggests to me that the best of the news of German industry is now behind us but I don't think it's weak enough to prevent the ECB from raising rates again in October," said Nick Stamenkovic, a strategist at RIA Capital Markets in Edinburgh.

"Whilst the market is pricing in 3.50% (ECB rates) by year-end, or thereabouts, anything beyond that is very much in question," he said.

"If the ZEW survey is to be believed, Germany could be heading for a U.S.-style slowdown which means ECB rate cuts sometime in 2007," said a broker from a French bank.

Wednesday, the Confederation of British Industry publishes its industrial trends report at 1000 GMT. The market expects the headline figure to ease to 11.5 in August from 14.0 in July, according to a Dow Jones Newswires survey.

"Confidence in the manufacturing sector remains high, a result of stronger export and domestic orders," HSBC said in a recent note. "Overall, we expect a small drop in both orders and expectations."

European government bonds rose Tuesday with bunds outperforming gilts after a larger-than-expected drop in Germany's ZEW business survey suggested European Central Bank interest rates may not rise much further, analysts said.

CALENDAR: Wednesday, Aug 23: UK Industry; US Energy Data

GMT Expected Previous
0900 EU Jul Euro Zone Stock Market Capitalization
1100 UK Aug CBI Indus Trends +11.5 +14
1100 US Aug 18 MBA Refinancing Index +1.4%
1400 US Jul Chicago Fed Natl Activity Index +0.34
1400 US Jul Existing Home Sales -1.1% -1.3%
1430 US Aug 11 US Energy Dept Gasoline Stocks -2.41M -2.3M
1430 US Aug 18 US Energy Dept Crude Oil Stocks -1.09M -1.6M
1430 US Aug 18 US Energy Dept Distillate Stocks +500,000 +800,000
2350 JPN Jul Corp Svc Price Index -0.1%YY

-By Dennis Baker; Dow Jones Newswires; dennis.baker@dowjones.com

(MORE TO FOLLOW) Dow Jones Newswires

August 23, 2006 01:45 ET (05:45 GMT)

Copyright (c) 2006 Dow Jones & Company, Inc.


23 Aug 2006 05:45 GMT =DJ EUROPEAN MORNING BRIEFING: Corporate Events

BHP Billiton (BHP): 1H Earnings
Average profit before items (Co, 23 analysts): $10.18B ($6.43B)
Forecast range: $9.561B - $10.578B
Note: The key driver is seen as "exceptionally strong" commodity markets, says Kepler Teather & Greenwood, with a standout performance expected by the company's base metals division. Expects BHP Billiton to unveil a share buyback program of at least $3B, "although it must be tempting to at least match Anglo American's (AAUK) current $4B program."


EFG Bank (EFGN.EB): 1H Earnings
Average net profit (DJ, 3 analysts): CHF90.1M (CHF30.4M)
Average sales: CHF278.8M (CHF140.6M)
Note: Profit growth to be driven by acquisitions and the resulting higher managed assets, analysts say. Income seen nearly doubling, driven by more commissions and bouyant trading. Analysts eyeing management comments on number of potential targets for EFG.


Slough Estates (SLOU.LN): 1H Earnings
Average net asset value per share (Co, 6 analysts): 728p (680p FY figure)
Note: Results are expected to have been driven by continuing capital growth in the industrial sector. News will be particularly sought on expansion into Continental Europe and increased exposure to development. Analysts will be looking closely at the UK industrial vacancy rate.


Telekom Austria (TKA): 2Q Earnings
Average net profit (DJ, 9 analysts): EUR126.2M (EUR75.5M)
Average EBIT: EUR187.2M (EUR126.5M)
Average sales: EUR1.15B (EUR1.01B)
Note: Earnings were driven by the mobile segment, especially by Bulgarian subsidiary Mobiltel, which was consolidated in 3Q 05, analysts say. In the wireline segment, earnings are expected to have dropped slightly. EBIT +48%, while sales are expected at +14%.


OTHER SCHEDULED EVENTS:

Angpanneforeningen (ANGP-B.SK): 1H Earnings

Bure Equity (BURE.SK): 2Q Earnings

Day Software Holding (DAYN.EB): 1H Earnings

DSV (DSV.KO): 1H Earnings

Farstad Shipping (FAR.OS): 1H Earnings

Golden Ocean Group (GOGL.OS): 2Q Earnings

Green Reefers (GRR.OS): 2Q Presentation

Immedia Broadcasting (IME.LN): 1H Earnings

Lagercrantz Group (LAGR-B.SK): AGM

Medi-Stim (MEDI.OS): 2Q Earnings

Nestle (NESN.VX): 1H Earnings

PA Resources (PAR.OS): Capital Markets Meeting

Rakentajain Konevuokraamo (RAK1V.HE): 1H Earnings

Vostok Nafta Investment (VOST-SDB.SK): 2Q Earnings


(MORE TO FOLLOW) Dow Jones Newswires

August 23, 2006 01:45 ET (05:45 GMT)

Copyright (c) 2006 Dow Jones & Company, Inc.


23 Aug 2006 05:45 GMT =DJ EUROPEAN MORNING BRIEFING: Div Payments & Ex Div Dates

Addtech (ADDT-B.SK): FY 2005 Ex-Dividend Date

Anglo American (AAL.LN): 1H 2006 Ex-Dividend Date

Anglo American (AAL.LN): Special Ex-Dividend Date

Bradford & Bingley (BB.LN): 1H 2006 Ex-Dividend Date

Countrywide (CWD.LN): 1H 2006 Ex-Dividend Date

Electric & General Investment (ENG.LN): FY 2005 Ex-Dividend Date

Hanson (HNS.LN): 1H 2006 Ex-Dividend Date

Henderson Far East Income Trust (HFE.LN): 3Q 2006 Ex-Dividend Date

Imperial Chemical Industries (ICI.LN): 1H 2006 Ex-Dividend Date

Nutreco Holding (37540.AE): 1H 2006 Dividend Payment Date

Pearson (PSON.LN): 1H 2006 Ex-Dividend Date

PZ Cussons (PZC.LN): FY 2006 Ex-Dividend Date

RoyalBlue Group (RYB.LN): 1H 2006 Ex-Dividend Date

Schroders (SDR.LN): 1H 2006 Ex-Dividend Date

SThree (STHR.LN): 1H 2006 Ex-Dividend Date

Ultra Electronics Holdings (ULE.LN): 1H 2006 Ex-Dividend Date


(END) Dow Jones Newswires

August 23, 2006 01:45 ET (05:45 GMT)