Pound Volatility Spikes for a Sixth Week as Brexit Vote Nears

PT. Equityworld Futures - Expectations for price swings in the pound climbed for a sixth week to a seven-year high as anxiety about a potential British exit from the European Union gripped investors.
The sterling headed for its second weekly decline versus the dollar before the U.K. votes on June 23 on whether to remain in the EU. The currency tumbled as much as 1.1 percent on Monday after polls signaled a lead for voters who support leaving the 28-nation bloc. It climbed as much as 1.5 percent the following day amid speculation a mistyped transaction had triggered automatic orders to sell or buy currencies to avoid losses.
Implied volatility for one-month options on the pound versus the dollar rose to 23.5 percent, the highest since January 2009, and more than double the level at the end of April. Expectations for price swings have climbed every week since the period ended April 29, the longest winning streak since late February.
Sterling was little changed at $1.4451 at 12:31 p.m. in Tokyo, and has depreciated 0.5 percent this week. The currency gained 0.1 percent to 78.17 pence per euro from Thursday.
The pound has been a gauge of sentiment throughout the referendum debate. It slid to a seven-year low of $1.3836 in February, and remains the worst-performing developed-market currency this year.
Source : Bloomberg

Japanese Shares Slide as Commodity Producers Retreat on Oil

PT. Equityworld Futures - Stocks in Tokyo fell as commodity producers dropped after oil declined, while investors awaited central bank meetings from the U.S. and Japan next week.
The Topix index lost 0.7 percent to 1,328.73 at the lunch break in Tokyo, with the measure headed for a weekly loss of 0.6 percent. The Nikkei 225 Stock Average slipped 0.5 percent to 16,586.71. The yen traded at 107.15 per dollar after strengthening to as much as 106.26 on Thursday. U.S. stocks fell for the first time in four days yesterday, with the S&P 500 Index slipping from a 10-month high, while oil posted its biggest drop since May 9.
The amount of shares traded in Tokyo have been muted this week with the Bank of Japan’s decision on monetary policy on June 16, a day after the Federal Reserve’s, and the U.K. vote on whether to remain in the European Union on June 23. Just 1.68 billion shares changed hands on Thursday, compared to an average 2.27 billion over the past year.
Source : Bloomberg

Jobless Claims in U.S. Unexpectedly Fell to 264,000 Last Week

PT. Equityworld Futures - First-time jobless claims unexpectedly fell last week and the number of Americans already receiving benefits tumbled to an almost 16-year low, consistent with a healthy labor market.
Applications to collect unemployment insurance dropped by 4,000 to 264,000 in the period ended June 4, Labor Department data showed on Thursday. The median forecast in a Bloomberg survey called for 270,000. Continuing claims decreased to 2.1 million in the previous week, the lowest since October 2000.
The report indicates companies remain reluctant to reduce headcounts even after figures last week showed May was the worst month for hiring in almost six years. Federal Reserve Chair Janet Yellen, who called the payrolls slowdown “concerning,” nonetheless pointed to claims as one of the more positive and timely indicators of the labor market.
While there was nothing unusual in the data, claims for Maryland were estimated, according to the Labor Department.
The decline in initial filings to a six-week low compared with economists’ projections that ranged from 260,000 to 285,000 after a previously reported 267,000 in the prior week.
The four-week moving average, a less volatile measure than the weekly claims numbers, decreased to 269,500 last week from 277,000.
Filings have been below 300,000 for 66 consecutive weeks -- the longest stretch since 1973 and a level economists say is typically consistent with a healthy labor market.
The number of people continuing to receive jobless benefits dropped 77,000 in the week ended May 28. The unemployment rate among people eligible for benefits decreased to a record-low 1.5 percent. These data are reported with a one-week lag.
Source: Bloomberg

Asian Stocks Drop as Japan Topix Falls With Commodity Shares

PT. Equityworld Futures - Asian stocks fell for a second day, following a retreat in global equities, as commodity producers dropped with oil and copper amid lingering concerns about moderate global growth before central bank policy decisions.
The MSCI Asia Pacific Index slipped 0.8 percent to 130.60 as of 9:10 a.m. in Tokyo, paring this week’s advance to 0.6 percent. Optimism that borrowing costs will remain lower for longer amid modest global economic growth is waning ahead of a string events in the next two weeks. The looming Federal Reserve and Bank of Japan meetings next week, followed by the vote on Britain’s membership in the European Union, have the potential to roil markets.
Global equities have rebounded from the lows seen in February as commodities have rallied. Oil has surged more than 90 percent amid unexpected disruptions and a slide in U.S. output, which is under pressure from the Organization of Petroleum Exporting Countries’ policy of pumping without limits.
Source : Bloomberg