Here are three things you should keep an eye on while tradiong today
Euro falls further
It’s hard to find an investor right now who ISN’T sure the dollar should continue rising against the euro. Yet when it starts happening too fast, markets start to brace for turbulence.
Overnight Tuesday the euro fell toward $1.07 in dollar terms, stirring another round of forecasts that the currencies would reach parity at 1-to-1 before long. At this point that’s less a forecast than a simple extrapolation of a chart line that’s turned almost vertical.
The “Why?” of this move is no mystery. The European Central Bank started its quantitative easing bond-buying program yesterday – far too late for it to compress already rock-bottom interest rates but perfectly suited to pressure the euro as a way to ease debt burdens and bolster exports from Europe.
The ECB is creating euros to purchase bonds – many from non-Europeans – who will take those euros and, to some significant degree, will cash them in for dollars or something else to buy assets elsewhere. And, of course, the Fed is the one central bank in the world poised to lift rates before terribly long, further boosting the dollar.
This is, sort of, the plan. But when the momentum of the euro decline and dollar advance seems too strong, emerging-markets stocks and bonds get dumped, concerns rise over a “too strong” dollar squeezing American corporate profits and traders step aside to see where things settle out.
That’s a decent description of why US stock futures look to reverse Monday’s unconvincing bounce, and then some. No panic yet, just an anxious “adjustment” on trading desks.
Apple Watch reaction: Day 2
Call real-time review of the Apple Watch by the market “unimpressed.” Apple shares peaked just as Apple wizards in San Francisco were detailing the fit, fashion and function of its new line of Apple watches Monday, and the stock declined until they quit talking.
It’s not that the watch wasn’t impressive, so far as it goes. Maybe Apple shares, up 68% in a year, were just too vulnerable to pent-up selling on the news.
Could be that too much was already known about the watch through leaks and the initial announcement last fall to impress a demanding techie crowd. Maybe Tim Cook and company just couldn’t sell the idea that many people will need this thing on their arm, especially an ostentatious $10,000 version.
But the bottom line is the bottom line – or rather that analysts can’t figure out how the watch helps it, or by how much.
The Street will be taking its stabs at quantifying the impact today. Here’s Goldman Sachs on the impact of Monday’s Apple unveils, including the watch and a nifty new Macbook: Apple earnings forecasts for fiscal 2015 go to $8.79 a share from $8.77, up a whopping two cents. Estimates for the next two years show meager increases of 13 and 20 cents a share, respectively.
Analysts could turn out to be horribly wrong, and the watch could usher in a whole new bounty of profits – who knows? The point it that, right now, nobody does.
Credit Suisse's new chief
Sometimes the market tells a man exactly what he’s worth in the moment. When Credit Suisse (CS) announced it had hired Tidjane Thiam from the U.K. insurer Prudential PLC (PUK), shares of Credit Suisse jumped by about $2.5 billion in market value, and those of Prudential UK fell by a similar amount.
That’s a pretty impressive swing attributed to the job hop of Thiam, an Ivory Coast native and former McKinsey consultant who has run Prudential PLC since 2009.
Much is being made of the end of Brady Dougan’s run as CEO of Credit Suisse, among the last of the crisis-era big bank CEOs. Perhaps as interesting is the fact that a man without experience in banking was the coveted choice to succeed him. In this world, insurance and global banking are similar enough – piles of capital, bundles of risk and nests of regulation to be sorted out.
More from Yahoo Finance
Bullish stock market sentiment is just one of several reasons to be cautious2 offbeat companies with fat dividend yieldsRetailers, restaurants and leisure stocks ready for spending boom