The stock market recovers to the unchanged mark and then runs into some selling resistance, sending it to a loss of 1%. Crude oil prices fall to session lows, currently down 3.4% at $55.10 per barrel.

The yen fell against the euro as U.S. stocks erased their decline, slowing the sale higher- yielding assets funded in Japan's currency. Japan's currency earlier rose against the dollar and the euro as a drop in U.S. stocks prompted speculation that investors will unwind carry trades. The Standard & Poor's 500 Index gained 0.5 percent after falling as much as 2.8 percent. The U.S. economy will contract 0.2 percent in 2009 after growing 1.4 percent this year, according to the median estimate in a poll of business economists taken by the National Association for Business Economics. A majority of respondents said the U.K., the euro countries, Japan, Canada and Mexico are either now, or will soon be, in a recession.

Trades around $1.2725 after easing back from mid-session high at $1.2742 with flows currently described as light, as were the volumes in the rally to highs that accompanied the brief bounce in stocks. Resistance remains at $1.2780/85, a triangle top and 21-day moving average.

The major indices continue to trade with modest gains, with only the financial sector remaining in the red. Still, even financials (-1.1%) have made a significant recovery from session lows when they were down 5.0%. Small- and mid-caps are outperforming with the Russell 2000 Index up 1.3% and the S&P 400 up 1.0%.

The pair dropped from C$1.2330 to C$1.2130 over the midday period as a scramble to buy the local currency breaks out. "Stops, a market tuned in to equities, and zero liquidity," blamed by a Toronto-based trader for the move. Lows thus far around C$1.2115 and no orders in sight.

The S&P 500 stands at 874.46, with technical analysts tracking the index closely. After closing at 1468.36 last year, the index has struggled throughout 2008. The S&P bottomed at 1,234.26 in mid July (when euro hit life-time high of $1.6040) and then rallied to 1,312.71 in early August before ratcheting sharply lower to 840.54 on
Oct 10. Last Thursday, the S&P broke below the Oct 10 low to test 818.91 before spiking higher to close at 911.29. "Following the bullish Reversal Day in the S&P 500 last week (Thursday), the low near 818 provides an important line in the sand if the market is to stabilize this week," say strategists at Barclays Capital. "A move below this low is needed to negate the signal of stability," they add. Treasury prices and yields move in opposite directions.

All three of the major indices climb into positive territory, with the S&P 500 posting the largest gain of 0.6%. There is not a specific news item to account for the buying interest.
The recovery effort is being led by energy stocks (+1.8%) as Exxon Mobil (XOM 75.84, +2.16) gains 2.9%.
Reuters reports that a Democratic leadership aide said the U.S. Senate is unlikely to pass a broad economic stimulus this year.

The stock market extends it declines and then recovers a bit. The energy sector (+1.1%) is providing leadership as crude oil prices ($58.28, +2.2%) rebound into the green.
The financial sector (-2.0%) is the main laggard. This morning Citigroup (C 9.20, -0.30) said it will cut 52,000 jobs from its 352,000 workforce. Citi has already cut roughly 36,000 positions in 2008. Meanwhile, there were reports that JPMorgan Chase (JPM 33.83, -0.64) is mulling job cuts.
In earnings news, Lowe's (LOW 14.64, +0.41) topped expectations for the third quarter, but issued downside guidance for the fourth quarter after warning that consumers will likely delay discretionary home improvement and big ticket purchases. Target (TGT 34.34, +1.27) reported in-line earnings for the third quarter, but decided to temporarily suspend its share repurchase program.

The stock market extends it declines and then recovers a bit. The energy sector (+1.1%) is providing leadership as crude oil prices ($58.28, +2.2%) rebound into the green.

The financial sector (-2.0%) is the main laggard. This morning Citigroup (C 9.20, -0.30) said it will cut 52,000 jobs from its 352,000 workforce. Citi has already cut roughly 36,000 positions in 2008. Meanwhile, there were reports that JPMorgan Chase (JPM 33.83, -0.64) is mulling job cuts.

In earnings news, Lowe's (LOW 14.64, +0.41) topped expectations for the third quarter, but issued downside guidance for the fourth quarter after warning that consumers will likely delay discretionary home improvement and big ticket purchases. Target (TGT 34.34, +1.27) reported in-line earnings for the third quarter, but decided to temporarily suspend its share repurchase program.

Stocks futures continue to point to a negative open:S&P futures vs fair value: -17.40. Nasdaq futures vs fair value: -32.80.
The November New York empire manufacturing index, a regional manufacturing survey, declined to -25.4 from its October level of -24.6. Economists expected a reading of -26.0. Citigroup (C) said it will cut 20% of its workforce from peak levels down to roughly 300,000, according the company's presentation slides. Citigroup had roughly 350,000 employees as of Sept. 30. Citi also plans to reduce expenses by 20% from peak levels. In earnings news, Target (TGT) earned $0.49 per share in the third quarter, matching estimates. The retailer is temporarily suspending its buyback program.
This week, Congress will take up the issue of bailing out the Big Three: General Motors, Ford Motors and Chrysler. The Senate Banking Committee will hold a hearing on the issue on Tuesday and the House Financial Services Committee on Wednesday.
Companies: Home improvement retailer Lowe's posted a 24% plunge in earnings to 33 cents per share. That still beat the 28 cents per share expected by analysts, according to a consensus of projections from Thomson Reuters. Shares were slightly lower in premarket trading.
Retailer Target is also expected to report quarterly earnings before the bell. A consensus of analysts projects earnings to fall 13% to 48 cents per share.
Oil fell $1.08 a barrel to $55.96 in electronic trading.

- OPEC sees average 2009 demand for its oil at 30.92mln bpd, 220,000 less than previously forecast
- OPEC sees risk of long recession, situation needs 'closer monitoring, more frequent intervention'
- OPEC says full effect of Nov1 supply cut will take time to show up in oil market.

Edges up to $1.2675 area in the wake of the Empire State data, while remaining inside $1.2650/1.2700. Morning highs seen at $1.2703 ahead of the US session saw two-way biz also with the sellers coming out on top, a trader says, while euro finds demand interest on approach to $1.2600 and the dollar slightly defensive overall.

Prices paid 20.48 vs 31.71. Most components fell, led by number of employees at -28.92 vs -3.66.

The following data were published:
10:00 Е15 Trade Balance s.a. (Sep) 5.7
10:00 Е15 Trade Balance n.s.a. (Sep) 5.6

The dollar fell against the yen and the euro as U.S. stock futures dropped before a report likely to show a gauge of manufacturing in New York slid to a record low.
The decline against the yen was the dollar's fifth in the past six days. The U.S. has entered a recession that will persist into next year, and economies around the world will follow suit, according to a survey by the National Association for Business Economics. Standard & Poor's futures expiring in December fell for a second day.
``There is a perception that the U.S. economy is more exposed to a slowdown than Japan,'' said Neil Mellor, a currency strategist in London at Bank of New York Mellon Corp. ``The yen is winning in the battle with the dollar because it is perceived as a greater safe haven.''
The New York Federal Reserve's general economic index may fall to minus 26.0, from minus 24.6 in October, according to the median forecast of 46 economists. Readings below zero for the Empire State index signal manufacturing activity is shrinking. Every component other than prices was negative for the month.
The MSCI Word Index of equities fell for a second day, slipping 0.5 percent, as stock markets in Europe and Asia declined.

EUR/USD the pair has established session high on $1,2700 then it was corrected in area $1,2650. Offers $1.2700.

"We estimate that global manufacturing output contracted at a hefty 3.6% annual rate
in the three months to September. October activity indicators point to an intensification of the downturn. Output is forecast to decline at an 8% annual rate over the current quarter and in 1Q09."

The dollar fell against the yen and the euro as U.S. stock futures dropped before a report likely to show a gauge of manufacturing in New York slid to a record low.
The decline against the yen was the dollar's fifth in the past six days. The U.S. has entered a recession that will persist into next year, and economies around the world will follow suit, according to a survey by the National Association for Business Economics. Standard & Poor's futures expiring in December fell for a second day.
``There is a perception that the U.S. economy is more exposed to a slowdown than Japan,'' said Neil Mellor, a currency strategist in London at Bank of New York Mellon Corp. ``The yen is winning in the battle with the dollar because it is perceived as a greater safe haven.''
The New York Federal Reserve's general economic index may fall to minus 26.0, from minus 24.6 in October, according to the median forecast of 46 economists. Readings below zero for the Empire State index signal manufacturing activity is shrinking. Every component other than prices was negative for the month.
The MSCI Word Index of equities fell for a second day, slipping 0.5 percent, as stock markets in Europe and Asia declined.

- Inflation to keep slowing, reach m-term price stability
- Medium-term inflation prospects are clearly brighter
- Can't exclude EMU GDP decline next year
- Inflation down but core still clearly above 2.0%
- Economic outlook has become clearly gloomier
- Financial market crisis has clearly hit real economy

CIBC strategists suggest selling the euro on rallies over $1.2700, with a downside target of $1.1650 (before year end) and a stop at $1.30. "While price action remains extremely volatile, the overall direction is clear; prices are heading lower," the strategists say. Fundamentals are also euro negative. The ECB has cut rates by 50 bps, but the EU two-year bond yields holds 100bps below the ECB target rate, "a sign that there is much rate cutting left to do," they say.

Resistance 3: Y100.55
Resistance 2: Y98.50
Resistance 1: Y97.60
Current price: Y96.58
Support 1: Y96.35
Support 2: Y95.90
Support 3: Y94.40
Comments: Tech on USD/JPY hasn't changed. The nearest support is presented by a level 50,0%FIBO of growth Y94,40-Y98,30 on Y96,35. Below possible decrease to Y95,90 (61,8 %) and further to a Thursday low on Y94,40. The nearest resistance is located in the field of МА (200) for Н1 on Y97,60 (also the given level is area of a session high). Overcoming of the given mark will open road to level Y98,50 (38,2%FIBO of falling Y110,65-Y90,90). Above is possible growth to Y100,55 (high of November; above, on Y100,75, is located the level of 50,0 % FIBO of falling Y110,65-Y90,90).

Resistance 3: Chf1.2215
Resistance 2: Chf1.2140
Resistance 1: Chf1.2000
Current price: Chf1.1915
Support 1: Chf1.1900
Support 2: Chf1.1830
Support 3: Chf1.1775
Comments: After the unsuccessful test of level Chf1,2000 the pair has decreased. The nearest support - Chf1,1900 (23,6 % FIBO of growth Chf1.1550-Chf1.2000). Below level Chf1.1830 (38,2 %) is located, decrease to Chf1.1775 (50,0 %) further is possible. Overcoming of level Chf1.2000 will open road to Chf1,2140 (area of high of September of the last year and lows of June and February of the last year) and further to Chf1,2215 (area of high of August 2008).

Resistance 3: $1.5220
Resistance 2: $1.5060
Resistance 1: $1.4955
Current price: $1.4925
Support 1: $1.4555
Support 2: $1.4280
Support 3: $1.4040
Comments: The pair tests resistance in the field of a Friday maximum on $1,4955. Above are located levels $1,5060 (38,2 % FIBO of falling $1,5880-$ 1,4555) and $1,5220 (50,0 %). As the nearest support acts the level of Thursday's low on $1,4555 (the level $1,4530 is area of low of June 2002). Below the level $1,4280 (low of April 2002) is located. Overcoming of the given mark will open road to area of minima of 2002 on $1,4040.

Resistance 3: $1.2860
Resistance 2: $1.2790
Resistance 1: $1.2700
Current price: $1.2696
Support 1: $1.2510
Support 2: $1.2385
Support 3: $1.2330
Comments: The euro has become stronger in relation to dollar. The nearest resistance at the moment is a level $1,2700 (session high). Further growth to $1,2790 (the close price of the last week) is possible. In case of continuation of growth by resistance will act the area $1,2860/80 ($1,2860 - Thursday's high, $1,2880 - a level 38,2% FIBO falling $1,3765-$ 1,2330). As the nearest support acts the level $1,2510 (session low). Overcoming of the given level will open road to $1,2385 (area of Friday's low). Below possible falling to two years low on $1,2330.

EUR/USD $1.2600, $1.2715/25, $1.2750, $1.2825, $1.3000
USD/JPY Y96.60, Y97.50, Y97.75, Y98.00, Y99.00, Y99.35, Y99.50, Y100.00, Y100.35
AUD/USD $0.6780
USD/CAD C$1.2300

The following data were published:
16/11/08 23:50 Japan Tertiary activity index (September) -0,6% -1,4%
16/11/08 23:50 Japan Real GDP (Q3) preliminary -0,1% -0,7%
16/11/08 23:50 Japan Real GDP (Q3) preliminary Y/Y -0,4% -3,0%
00:01 UK Rightmove House Price Index (MoM) (Oct) -2,9%
00:01 UK Rightmove House Price Index (YoY) (Sep) -7,1%
00:30 Australia Real Retail Sales (QoQ) (3Q) 0,1%

The yen fell against the dollar and pared gains against the euro as a rebound in Asian equities bolstered confidence in funding purchases of higher-yielding overseas assets in the Japanese currency.
The yen also weakened against the Australian and New Zealand dollars, favorites of so-called carry trades, as U.S. stock futures advanced. The euro declined versus the dollar for a second day on speculation that the European Central Bank will lower interest rates to help bolster the 15-nation region's economy.
In carry trades, investors get funds in a country with low borrowing costs and buy assets where returns are higher. Japan's 0.3 percent target lending rate compares with 1 percent in the U.S., 3.25 percent in Europe, 5.25 percent in Australia and 6.5 percent in New Zealand.
The yen had strengthened earlier after the Group of 20 nations failed to agree on specific measures to combat a global financial crisis, prompting investors to sell higher-yielding assets funded in Japan.
The G-20 urged a ``broader policy response'' and set a March deadline for recommendations on improving regulations at a summit that ended in Washington on Nov. 15. Leaders of G-20 countries met as a seizure in credit markets, stemming from losses of $964 billion on securities tied to home loans, threatened to trigger a global recession.
Japan's government today reported that gross domestic product fell at an annualized 0.4 percent pace in the three months ended Sept. 30, after sliding at a 3.7 percent rate in the previous quarter. Economists predicted 0.1 percent growth, a Bloomberg survey showed.
The euro declined on speculation that European central bankers will signal further rate reductions after data on Nov. 14 showed the 15-nation euro area slid into its first recession since the currency's introduction in 1999.
European Central Bank members Gertrude Tumpel-Gugerell and Axel Weber speak at 9 a.m. and 9:50 a.m., respectively, in Frankfurt. Central banks around the world may lower rates as inflation slows amid a global recession, ECB President Jean- Claude Trichet said in Sao Paulo on Nov. 10.
Traders increased bets that the ECB will reduce its 3.25 percent benchmark interest rate. The implied yield on Euribor futures contracts expiring in March fell to 2.81 percent on Nov. 14 from 3.15 percent at the end of last month.

EUR/USD having begun session in the field of $1,2536, the pair has slightly become stronger to the beginning of the European session up to a level $1,2585.

Japan's benchmark stock indices ended Monday's session modestly higher, having swung wildly through the day. The Nikkei 225 gained 60.19 points, or 0.71%, to stand at 8522.58. The broader-based TOPIX was up 3.58 points, or 0.42%, to 850.49. Volume for the Nikkei constituents totalled 1.460 bn, with 128 issues higher and 91 lower.

Stocks traded with losses for the majority of the session, but gradually climbed to positive territory late in afternoon trading. The rally proved unsustainable, though, as selling pressure intensified to rapidly send the stock market back to session lows.
Stocks were down 4.2% for the week. The S&P 500 is 6.7% above its five-year low, which was taken out in the prior session.
Trading remains volatile as investors continue looking for a bottom amid ongoing uncertainty in financial markets and global economic conditions. However, if anything is certain at this point, the bottom won't be marked by a clear V-shape.
In case they had forgotten, investors were reminded about the global economy's tenuous standing when leading handset company Nokia (-1.56) stated it expects fourth quarter industry volume to decline. The firm sees softer consumer spending amid weak economic conditions, while trade partners are challenged by credit conditions.
Weak economic conditions also have retailers fretting over the holiday shopping season. Kohl's (-1.48), Nordstrom (-1.22), JCPenney (-2.01), and Abercrombie & Fitch (-4.65) each issued downside guidance for the fourth quarter.
The glum outlook mirrors a 2.8% decline in October total retail sales. Excluding autos, retail sales declined 2.2%. Both were worse than expected.
The downbeat retail sales data set a weak foundation for the PCE component of fourth quarter GDP. Moreover, the data validate the idea that fourth quarter GDP will be well below the original 0.3% decline reported for the third quarter.
In other economic data, October import prices were up 6.7% year-over-year, missing the consensus of an 8.2% year-over-year increase.
September business inventories were down 0.2%, which is below the consensus forecast of a 0.1% decline. The prior reading was revised lower to a 0.2% increase.
Losses among stocks were deep and broad based Friday. Only the consumer staples sector (-2.9%) finished with a loss of less than 3%.
The financial sector (-5.2%) continued to underperform with more than 90% of the financial firms in the S&P 500 posting a decline.
Energy stocks (-4.0%) were also hit hard. The sector put together an 11% advance in the prior session, but with crude oil prices slipping more than 3% investors moved to take some profits off the table. Crude closed the session around $56.30 per barrel.
Weakness in equities sent government securities higher. The 10-year Treasury Note advanced 37 ticks, which was its largest advance this week. The Note currently yields 3.71%.

The yen rose, heading for weekly gains against the euro and the dollar, as a drop in U.S. retail sales prompted speculation investors will sell higher-yielding assets and pay back low-cost loans in Japan's currency.
The dollar was poised for a second weekly gain versus an index of the currencies of six major trading partners as investors sought the relative safety of U.S. assets. The yen climbed against the Australian and New Zealand dollars today on bets a Group of 20 nations summit will fail to reach a consensus on resolving the credit crisis, sapping carry trades.
The yen advanced 1 percent to 96.77 per dollar at 10:59 a.m. in New York, from 97.68 yesterday. Against the euro, the yen climbed 1.7 percent to 122.73 from 124.78. The euro depreciated 0.8 percent to $1.2669 from $1.2769. The pound decreased 0.2 percent to $1.4809.
Sales at U.S. retailers fell 2.8 percent in October, the biggest drop since records began in 1992, the Commerce Department reported today in Washington. The dollar briefly pared its loss against yen as the Reuters/University of Michigan preliminary index of consumer sentiment unexpectedly rose to 57.9 from 57.6 in October.
I wouldn't suggest the markets are trading on economics as much as on equity flows at this moment.''
The Standard & Poor's 500 Index decreased 2.5 percent after rallying 6.9 percent yesterday. The Dow Jones Industrial Average dropped 2.8 percent following a gain of 6.7 percent.
The euro fell 0.4 percent this week against the dollar, while the British pound slid 5.4 percent as the European Central Bank and the Bank of England faced mounting pressure to lower borrowing costs.
Gross domestic product in the 15 euro nations shrank 0.2 percent from the previous three months, when it also contracted 0.2 percent, the European Union's Luxembourg-based statistics office said today. The two quarters of contraction mark the first recession since the single currency was introduced almost a decade ago.
The Bank of England is prepared to cut rates from 3 percent, Governor Mervyn King said this week.
Leaders of G-20 countries were gathering in Washington to debate proposals ranging from curbing executive pay and restraining hedge funds to raising capital requirements for banks after financial institutions worldwide lost $958 billion on securities tied to U.S. mortgages.

Resistance 3: Y100.55
Resistance 2: Y98.50
Resistance 1: Y97.60
Current price: Y97.09
Support 1: Y96.35
Support 2: Y95.90
Support 3: Y94.40
Comments: he yen had strengthened earlier after the Group of 20 nations failed to agree on specific measures to combat a global financial crisis, prompting investors to sell higher-yielding assets funded in Japan. The nearest support is presented by a level 50,0%FIBO of growth Y94,40-Y98,30 on Y96,35. Below possible decrease to Y95,90 (61,8 %) and further to a Thursday low on Y94,40. The nearest resistance is located in the field of МА (200) for Н1 on Y97,60 (also the given level is area of a session high). Overcoming of the given mark will open road to level Y98,50 (38,2%FIBO of falling Y110,65-Y90,90). Above is possible growth to Y100,55 (high of November; above, on Y100,75, is located the level of 50,0 % FIBO of falling Y110,65-Y90,90).

Resistance 3: Chf1.2215
Resistance 2: Chf1.2140
Resistance 1: Chf1.2000
Current price: Chf1.1965
Support 1: Chf1.1945
Support 2: Chf1.1830
Support 3: Chf1.1775
Comments: The pair tests resistance in the field of Chf1,2000. Overcoming of the given level will open road to Chf1,2140 (area of high of September of the last year and lows of June and February of the last year) and further to Chf1,2215 (area of high of August, 2008). The nearest support - area of Friday's high on Chf1,1945. Below level Chf1.1830 (38,2 % FIBO of growth Chf1.1550-Chf1.2000) is located, decrease to Chf1.1775 (50,0 %) further is possible.

Resistance 3: $1.5220
Resistance 2: $1.5060
Resistance 1: $1.4870
Current price: $1.4754
Support 1: $1.4555
Support 2: $1.4280
Support 3: $1.4040
Comments: The pound has receded from reached in the beginning of session low. As the nearest support acts the level of Thursday's low on $1,4555 (the level $1,4530 is area of low of June 2002). Below the level $1,4280 (low of April 2002) is located. Overcoming of the given mark will open road to area of minima of 2002 on $1,4040. In case of restoration by intermediate resistance there will be a level $1,4870 (23,6%FIBO of falling $1,5880-$ 1,4555). Above are located levels $1,5060 (38,2 %) and $1,5220 (50,0 %).

Resistance 3: $1.2860
Resistance 2: $1.2790
Resistance 1: $1.2675
Current price: $1.2585
Support 1: $1.2510
Support 2: $1.2385
Support 3: $1.2330
Comments: The pair the beginning week decrease, but has slightly receded from the reached low later. As the nearest support acts the level $1,2510 (session low). Overcoming of the given level will open road to $1,2385 (area of Friday's low). Below possible falling to two years low on $1,2330. In case of continuation of restoration by the nearest resistance there will be a level $1,2675 (23,6%FIBO of falling $1,3765-$ 1,2330). Further is possible growth to $1,2790 (close price of last week). In case of continuation of growth by resistance will act the area $1,2860/80 ($1,2860 - Thursday's high, $1,2880 - a level 38,2%FIBO of falling $1,3765-$ 1,2330).

High Low Close
EUR/USD 1.2828 1.2609 1.2791
USD/JPY 98.08 96.06 97.57
GBP/USD 1.4948 1.4656 1.4947
USD/CHF 1.1940 1.1839 1.1852

EUR/JPY 124.86 121.33 124.82
EUR/GBP 0.8634 0.8520 0.8555
GBP/JPY 146.31 140.99 145.85
GBP/CHF 1.7735 1.7458 1.7714

Change % Change Last
Nikkei +223,75 +2,72% 8 462,39
Topix +7,15 +0,85% 844,68
FTSE +63.76 +1.53% 4,232.97
DAX +60.72 +1.31% 4,710.24
CAC +22.01 +0.67% 3,291.47
Dow -337.94 -3.98% 8,497.31
NASDAQ -79.85 -5.00% 1,516.85
S&P -38.00 -4.17% 873.29
10yr Note -0.6800 -0.178% 3.750%
NYMEX Crude Oil -1.20 -2.10% 57.04
Gold +37.50 +5.05% 742.50

00:01 UK Rightmove House Price Index (MoM) (Oct) -2,9% 1,0%
00:01 UK Rightmove House Price Index (YoY) (Sep) -7,1% -4,9%
00:30 Australia Real Retail Sales (QoQ) (3Q) 0,1% 0,5% -0,6%
10:00 Е15 Trade Balance s.a. (Sep) -6,1
10:00 Е15 Trade Balance n.s.a. (Sep) -9,3
13:30 USA NY Fed Empire State manufacturing index (November) -25,8 -24,6
14:15 USA Capacity utilisation (October) 76,5 76,4
14:15 USA Industrial production (October) -0,2% -2,8%