Daily Market Reviews by MAYZUS.com

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MAYZUS Investment Company Ltd (formerly United World Capital Ltd) is proud to provide daily market reviews by the well-known financial expert – Mr. Arne Treholt, a former Political Secretary to the Minister of Shipping and Foreign Trade, then Deputy Minister of Law of the Sea of the Norwegian Royal Ministry of Foreign Affairs. He also held the position of Counselor for Economic Development and Social Affairs at the Ministry of Foreign Affairs, and was member of the Norwegian Mission to the United Nations, New York. At the moment Mr. Treholt is a Vice President and a Business Development Director of MAYZUS Investment Company Ltd.

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24 JANUARY 2013: USA INDEXES UPDATED 5-YEAR MAXIMA

DAILY MARKET REVIEWS
by Arne Treholt Vice-President of Business Development and Investments

On Wednesday, January 23, the stock market of the United States finished trading session by the moderate growth of the main indexes, S&P500 and Dow Jones appeared on fresh 5-year maxima. The positive information background on stock markets was provided by quarterly reports of representatives of hi-tech sector and favorable forecasts of a number of industrialists.

However the reporting of the Apple company which came after closing of the trading session disappointed investors. Within the additional session price of shares of Apple fell in price for 11%. Futures for the Nasdaq 100 index at the morning electronic trading are decreasing by 1,4%. Thus, the technological sector appeared under pressure today.

Asian stock indexes today "is in a fever", session began with decrease, subsequently the Chinese statistics allowed to resume purchases and helped indexes to reach profitable zone, but at a present moment sales again reign in the markets, and only Japanese Nikkei continues growth. Purchases in Japan are caused by the renewed decrease in yen, USD/JPY pair grew by 0,7% to level 89,2, after a release of data on trade balance. According to these data, in 2012 Japan recorded annual deficiency of foreign trade the second time in a row, thus the negative balance this year was maximum for all history and made 6,927 trillion yens.

Coming back to China, it should be noted that the production index PMI, from HSBC bank, increased the fifth month in a row, and according to preliminary data, it was in January at the level of 51,9, against December value 51,5. In the moment this news was apprehended by traders very positively, the Chinese continental SSE index came in plus of 2% and pulled for itself other Asian indexes, however so sharply growth was leveled.

Prices of oil between the Brent and WTI brands considerably differ. Brent raised to 112,83 dollars for barrel while the price of WTI fell almost by 1,5% and bargains at the level of 95,57. So essential distinction is caused with the advent of news about an operational malfunction on the key oil pipeline - Seaway. Through this branch oil is delivered from Cushing storage in Oklahoma to key oil processing regions on the coast of the Gulf of Mexico. Capacity is reduced from 400 thousand to 175 thousand barrels per day. Stocks are in Cushing at maximum levels, and at such technical failures they can only continue to increase. It also is at present the main factor of sales of a WTI contracts.

Copyright: MAYZUS Investment Company Ltd

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25 JANUARY 2013: THE JAPANESE YEN UPDATES MINIMUM LEVELS

DAILY MARKET REVIEWS
by Arne Treholt Vice-President of Business Development and Investments

Asian stock markets again don't show uniform dynamics today, and again "independently" there is a Japanese Nikkei index with growth more than for 2%. The reason is still the same, decrease in national currency was resumed, and today USD/JPY pair already bargains around level 90,5. Statements of the deputy minister of economy of Japan, Yasutosi Nisimura, that decrease of currency isn't finished yet, and the level of 100 yens for dollar seems quite achievable, added interest to speculative sale of yen.

During the today's Asian session the British pound continued to decrease against US dollar and at the moment practically approached yesterday minimum. The British pound bargains at the level of 1,57884. Today gross domestic product of Great Britain for the 4th quarter is published: the forecast of -0,1% against 0,9% in the 3rd quarter. In case of a release of weak data, the price will continue to fall.

Thanks to signs of improvement of economic activity in the Euro zone, EUR/USD pair continued correctional movement and grew to level of 1,3393 euros against US dollar at the trading on Thursday, and positive data from a labor market of the USA only strengthened tendency of investors to risk, having added an impulse in growth of the European currency. This morning we see pair bargaining at the level of 1,3337.

Yesterday trading volumes of oil were 30% higher than the monthly average. This morning Brent bargains at level of $113,08, and WTI at $95,93. As for a technical picture, due to yesterday's growth the alignment of forces exchanged a little. Quotations on Brent rose above a key mark of $113, having updated thereby three-month maximum. In case of lack of a general negative in the market, growth continuation is expected for the purpose of achievement of level of $117 for barrel.

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28 JANUARY 2013: EURO/USD BOUNCES TO 11 MONTHS HIGH

DAILY MARKET REVIEWS
by Arne Treholt Vice-President of Business Development and Investments

EURO/USD bounced to its highest level in 11 months amidst mounting signs of recovering economic confidence in the Euro zone. Euro/USD is trading at 1.3459 after hitting 1.2480 on Friday. The Euro is also gaining ground against the Japanese Yen which continues to fall also against the USD on expectations on active monetary easing. The strength of the Euro is supported by a more positive business sentiment in Germany and by European banks actively paying back credits taken given by the European Central Bank (ECB) since 2011.

USD/Yen fell to 91,26 yen to a dollar on Friday which is the lowest level seen since June 2010. Since last November Yen has fallen 13% against the USD and a record 17% versus Euro. The Japanese Nikkei stock index reach new record levels while the South Korean Kospi is falling back mainly due to a stronger Won. Over the last days there has been growing dissatisfaction with the strong fall in the Yen both from South Korea and China and from the Russian and German central banks.

Historically speaking Yen is still relatively strong. During the early 1990’ies USD/Yen was trading at 158 and apart from a brief period in 1995 it has traded below 90 yen a dollar only since the middle of 2010. Stocks in Asia are except for South Korea still up on better US economic news on jobless rate, manufacturing, better housing and retail spending. Chinese data continue to confirm that the Chinese economy is turning around.

The British Pound (GPB) has fallen below the technical resistance level at 1,58 against the dollar trading at 1.5754. Data before the weekend showed that the UK economy shrank more severely than expected in the fourth quarter shrinking with 0,3% rising fear of a third dip recession. The market expectation was a decrease of 0,1% in the gross domestic product, GSDP. The number was particularly disappointing taken into consideration the robust 0,9% growth in the third quarter. It now seems that this strong growth was entirely down to the boost given by the London Olympics.

The short term prospect for GBP is negative.

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29 JANUARY 2013: EURO AND ASIA STEADY ON HIGHER RISK APPETITE

DAILY MARKET REVIEWS
by Arne Treholt Vice-President of Business Development and Investments

Asian shares rose on Tuesday amidst improved risk appetite and a rotation of funds from bonds and treasury bills into equities. Bargain hunters took advantage of recent selling, but generally investors were cautious ahead of new US economic data and a Federal Reserve policy decision later in the week. More solid US growth indicators as reduced numbers of job claims, better manufacturing and housing data, have fuelled speculation that FED might consider pulling back on aggressive easing stimulus.

The MSCI-index for Asia Pacific, Japan’s Nikkei and South Korean shares all posted healthy gains after falling back on Monday. Australian shares jumped 1,1% on gains in the financial sector. American and European shares hold on to earlier gains. A rise in a gauge of planned US business spending in December added to the positive market sentiment along with easing financial stress in the Euro zone. European blue chips reached a fresh 18 month peak on Monday.

The Euro/USD is helped by the increased risk appetite and stay firm at 1.3450. USD/JPY trades close to 91. The Japanese yen continue to be under pressure on monetary easing which have seen the yen depreciate 13% against USD and 17% versus Euro since mid-November. The British pound, GBP, fell on Monday to its lowest level since August at 1.5867 on comments from the incoming Bank of England Governor, Mark Carney. Carney indicated that there was still scope for monetary policy to do more in the developed world.

The prospect for a more activist British monetary policy came on the top of other negative financial and economic developments which threaten the British economy with a triple-dip recession. The UK government cost cutting measures have come under renewed criticism as the door for a possible British exit from the European Union is kept open. It is highly likely that these combined factors would mean increased downward pressure on the pound.

Oil prices continue to be strong. Brent crude reached USD 113,50 a barrel. Other commodities are rising on growth expectations. The bell water copper gained 0,2% and traded on USD 8 065 a tonne in London. Gold and silver which fell at the end of last week mostly on profit taking, are showing a firmer trend this morning. Gold trades at USD 1660 an ounce.

Copyright: MAYZUS Investment Company Ltd

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30 JANUARY 2013: EURO/USD EYES 1.37 – 1.38 LEVEL

DAILY MARKET REVIEWS
by Arne Treholt Vice-President of Business Development and Investments

The Euro/USD has strengthened further trading at 1.3493 close to the critical 1.35 level eyeing 1.37 – 1.38. The US dollar has except for Japanese Yen lost ground against most currencies. USD/JPY trades steady in the range between 90,50 – 91 yen a dollar near the peak of 91.32 reached on Monday. This is the lowest level seen for yen since June 2010. Euro also gained 0,3% to 122,78 against the Yen. The prospect of a weaker yen and increased risk appetite lifted the Australian dollar and the New Zealand kiwi to a four year high against yen. GBP/USD fell back to 1.5745.

Stock markets continue to see new highs not seen for years. The Asian indexes led by the South Pacific MSCI rose to the highest levels in 18 months. A strong US housing market and stabilization inside the Euro zone boosted investor confidence and the global economic outlook. Commodity prices continue to raise with copper adding another 0,6%. Oil prices reached its highest level seen in months. Brent crude trades above USD 114 and the New York, NYMEX, is steady in the range of USD 97 – 98 a barrel.

The US Federal Reserve (FED) ends its two days meeting on Wednesday. It is expected that FED will continue with its monetary easing policies. This amidst speculation that the better prospects for US economy might soon end FED’s aggressive asset buying program. Investors will focus on the final statement and look for any clues to a change in FED’s policies. A continuation of FED’s policies will strengthen the continued rotation of funds from the bond market into shares, boost emerging markets and weaken the attractiveness of safe-haven assets.

The US stock market was very strong yesterday. Dow Jones was close to reaching the 14 000 index level. European stocks delivered better than in months as US companies continue to beat earnings forecasts. The leading on line book store, Amazon, delivered upbeat results which lifted the share 10%. Car maker, FORD, saw excellent results in the US, but sales in Europe disappointed. Most European equities rose to fresh two-years high. Together with US and Asia these increases boost stock markets as the favorite place for investments in 2013.

Copyright: MAYZUS Investment Company Ltd

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31 JANUARY 2013: EURO/USD STEADY AS FED STICKS TO STIMULUS

DAILY MARKET REVIEWS
by Arne Treholt Vice-President of Business Development and Investments

The US-Federal Reserve (FED) will continue its aggressive monetary easing stance. In the minutes from yesterday’s meeting FED pledged to stick to its ambitious 6,5% unemployment and 2% inflation targets as the US Gross Domestic Product (GDP) dropped by 0,1% in fourth quarter of 2012. The negative GDP number was somewhat of a cold shower for markets which dropped substantially both in the US, Europe and this morning in Asia. Asian markets fell off a 17 months high.

FED’s statement and the GDP numbers had little impact on the currency markets. Euro/USD reached 1.3588 upon FED’s announcement and keeps steady at 1.3569. Yen gained some ground trading at 90,80 yen against USD. Oil prices are up. Brent crude trades at USD 115 a barrel. Gold and silver prices regained ground and reached the highs for 2013 seen last week. Swedish and Norwegian krones trade at levels not seen against the dollar since before the financial crisis in the autumn of 2008.

The cautious FED statement which pledged to continue a monthly USD 85 billion bond-buying stimulus plan to encourage employment came few hours after the news that the US economy unexpectedly contracted in the fourth quarter. The weakness was mainly due to a plunge in defence spending, suggesting that the underlying fundamentals were better than the headline figures indicated.

European data showed an improved economic sentiment for a third straight month along with news that 100 billion Euros of private funds flowed back into the Eurozone periphery late last year. These capital flows have strengthened the Euro which broke through the 1,35 technical resistance level yesterday. 1,37 – 1,38 seems a reasonable short term target for the Euro/USD. Recent capital flows shall, however, not be read as an end of the Euro crisis. Economic fundamentals are still very weak with 25% unemployment levels in the European periphery threatening the delicate social balance. It is a question for how long the strong Euro policy will continue. Major international banks see a Euro/USD at 1,25 during the second half of 2013.

Copyright: MAYZUS Investment Company Ltd

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01 FEBRUARY 2013: EURO/USD HITS NEW HIGH 1,3624

DAILY MARKET REVIEWS
by Arne Treholt Vice-President of Business Development and Investments

US nonfarm payroll has the top focus on investor’s agenda when presented later today. After a strong start on the new year with global share indexes gaining 8 – 10% in January, disappointing negative growth, GDP numbers, from US in the fourth quarter of 2012 and a tepid Chinese purchasing manager’s index (PMI) for January, have cooled the dominating positive sentiments. Nervousness again rides global in markets searching for directions. The US and Chinese numbers underscore the fragility of the global recovery. These concerns do not hamper some currencies. EURO/USD has brushed through 1,36 trading at 1.3624 while USD/JPY jumped to 92,14.

Both US and the China are presenting mixed and somewhat contradictory figures. The US housing and manufacturing sector seem to spring back to life as companies generally have presented quarterly results better than expected. Along with the disappointing PMI-figures a separate private Chinese study simultaneously showed that their giant manufacturing industry hit a two-year high on strengthened domestic demand. This indicates that while the export is declining, domestic demand is picking up due to strong infrastructure spending and other investments encouraging domestic growth.

The Euro reached a 14-month high at 1.362. The strength of the common currency pushed the dollar index to a one month low of 79,107. The revival of the Euro is set to continue for some time as investors return to euro zone bond markets encouraged by the European Bank’s (ECB) assurances to take whatever measures necessary to save the Euro. Absence of economic growth in the Euro zone further means that there is no risk for inflation. The Yen to Japanese exporters delight is continuing to fall. 100 yen a dollar seems to be within realistic medium term reach. After steep falls earlier in the week, British pound GDP, has stabilized against the dollar at 1,5871.

US crude futures, NYMEX, reached USD 97, 56 a barrel while Brent rose 0,3% to SD 115.90, the highest levels seen for months. Copper prices are up. Gold and silver fell steeply yesterday, but seems to consolidate on 1660 and 31,35 levels respectively. The strong oil and commodity prices have given a boost to currencies as Australian dollar, Norwegian krones (NOK) and Canadian dollar.

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04 FEBRUARY 2013: EURO REACHES 1,37; GBP AND YEN PLUNGE

DAILY MARKET REVIEWS
by Arne Treholt Vice-President of Business Development and Investments

The Dow Jones Industrial Average (DJ) rose to 14 000 for the first time since October 2007 on Friday. The Standard & Poor’s 500 Index also hit its highest level since December 2007. The Asian markets drew momentum from the jump in US indexes and data showing a credible recovery. The Federal Reserve’s (FED) last week resolve to continue monetary easing along with solid manufacturing data both from Europe and China, contributed to the positive market sentiment.

US payrolls statistics showed Friday an increase of 157 000 new jobs in January with numbers for November and December adjusted up. The MSCI index for Asia Pacific rose 0,6% after posting a 0,7% gain last week. Australian shares jumped 0,9% to a 21-month high. The Japanese Nikkei rose 0,5%.

There were big currency movements on Friday. Presented data showed that those euro zone factories in January had their best month in one year. This lifted the Euro to a 14-half-month peak at 1,3711. Euro/USD has corrected in early Monday trading and eased to 1.3624. The Japanese yen continues to fall. USD/JPY which traded at a peak of 92,97, has eased back to 92,72. The British pound, GBP, reached a bottom of 1.5670 towards the dollar on Friday and trades at 1.5700 in early Asian trading.

Risk appetite continues to grow. The dollar index measured against a basket of currencies fell to a for-and-a-half-month low to 78,918 on Friday while investors in January poured a record USD 77,4 billion into mutual and exchange traded funds. This is a huge increase from the previous record on USD 53.7 billion in February 2000. In the oil market Brent crude had its highest weekly gain since mid-November on tension in the Middle East and prospects for economic growth.

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05 FEBRUARY 2013: EURO PLUNGES ON SPANISH TURMOIL

DAILY MARKET REVIEWS
by Arne Treholt Vice-President of Business Development and Investments

After sniffing on 1,37 EURO/USD plunged below 1.35 yesterday and trades at present at 1.3493. The Euro has rallied against most currencies in January. At its peak Friday the EURO had since January 1st risen from 2 to 5% against all major currencies. The decline of the Euro came amidst market turmoil and volatility in the currency markets. Oil prices dropped. Brent crude fell two dollars a barrel to 115.

Political turmoil and renewed fear on the sovereign debt crisis in the euro zone hit global equity markets strongly. After weeks of impressing gains shares fell steeply in Europe, United States and Asia. The Standard & Poor 500 Index faced its worst fall since November, the technology index, Nasdaq, dropped 1,5% and the MSCI index for Asia Pacific fell 0,8% after reaching a 18-month high at the beginning of the week.

A grooming corruption scandal in Spain and the possibility for a return to power of Silvio Berlusconi in Italy had global markets to shiver. Prime Minister Mariano Rajoy and his party have rejected the corruption allegations, but the accusations come amidst harsh austerities and 25% unemployment furthering political instability. Spanish and Italian 10-year government bond yield rose to the highest levels in weeks and raised questions whether Spain and Italy would be able to fix their fiscal problems.

Markets have over the past few months been increasingly comfortable with European risks. Political turmoil has not been taken into consideration. The outcomes in Spain and Italy are far from certain and may pose a stumbling block for further risk appetite which. This might seriously hit the Euro which also would be in for profit taking. In the short term perspective the Euro might fall back to 1.32 – 1.33. USD/JPY has taken a short pause at 92,30, but seems set for 95 during the next coming weeks. The Australian central bank kept the interest rate at 3%. This has strengthened the Australian dollar. USD/GBP is stabile trading at 1,5751.

Copyright: MAYZUS Investment Company Ltd