Daily Comment Raiffeisen RESEARCH

28 July 2011

Chart of the day

Hourly Q/SPc1
Price USD 38,2% 1.326,84 SMA; Q/SPc1; Last Trade(Open); 13; 01:00 28.07.2011; 1.302,41 SMA; Q/SPc1; Last Trade(Open); 13; 01:00 28.07.2011; 1.302,41 Cndl; Q/SPc1; Last Trade 01:00 28.07.2011; 1.300,70; 1.301,90; 1.300,70; 1.301,90 SMA; Q/SPc1; Last Trade(Open); 13; 61,8%01:00 28.07.2011; 1.302,41 1.321,34 SMA; Q/SPc1; Last Trade(Open); 13; 01:00 28.07.2011; 1.302,41 Cndl; Q/SPc1; Last Trade 01:00 28.07.2011; 1.300,70; 1.301,90; 1.300,70; 1.301,90 08:00 26.07.2011 - 08:00 28.07.2011 (CHG) Price USD

Important indicators today

RBI USA
16:00 n.a. Pending home sales, mom Colgate-Palmolive, Kellogg, Sprint Nextel, Starbucks, Exxon Mobil Deutsche Brse, BASF, Bayer, Credit Suisse, France Telecom, Deutsche Lufthansa, MAN, Royal Dutch, Sanofi, Siemens, Telefonica, VW, Danone, Infineon GE: Unemployment, mom, thsd EUR: Economic confidence EUR: Industrial confidence SA: PPI (MoM) BZ: FGV Inflation IGP-M (MoM) Jun Q2figures Q2figures n.a. -2.0% 8.2% -

Kons.

zuletzt

1.323 1.320 1.317 1.314

1.323 1.320 1.317 1.314

100,0% 1.312,45

1.311 1.308
1.307,22

1.311 1.308 1.305 1.302 1.299

161,8% 1.298,07 38,2% 1.296,18

Europe
n.a. -

1.305 1.302 1.299 1.296

.12 08:00 09:00 11:00 13:00 15:00 16:00 18:00 20:00 22:00 00:00 02:00

1.296
.12 08:00 09:00 11:00 13:00 15:00 16:00 18:00 20:00 22:00 00:00 02:00 04:00 06:00 08:00

09:55 11:00 11:00 11:30 13:00

Jul Jul Jul Jun Jul

-25 103.5 2.4 n.a n.a.

-13 104.0 2.0 3.9% -0.1%

-8 105.1 3.2 0.4% -0.2%

61 8% 1 293 14 04:00 06:00

26 Juli 2011

27 Juli 2011

28 Juli 2011

Source: Thomson Reuters, Raiffeisen RESEARCH

S&P Future

Last: 1,301 Sell 1,297 Target: 1,293 1,288 Bearish consolidation, stop 1,306 -> 1,311. July 28h, 2011 07:49 CET

Emerging Markets

Source: Bloomberg, Raiffeisen RESEARCH

Market overview
cur.
Interest rates, yields 3M Euribor EUR 3M Libor USD Bund Future EUR US T Note Future Currencies EUR/USD EUR/JPY EUR/CHF EUR/CZK EUR/HUF EUR/PLN Equity markets S&P 500 Dow Jones I. A. Nasdaq Comp. DJ EuroStoxx 50 DAX ATX Nikkei 225 Emerging Markets Hang Seng (China) Sensex (India) Bovespa (Brazil) JALSH (South Africa) Commodities Brent Oil USD/bbl Gold USD/oz Credit markets iTRAXX Europe ITRAXX Crossover iTRAXX Fin. Senior 5J CDS Greece. 5J CDS Spain 5J CDS Portugal 107 407 173 1699 265 958 3 BP 10 BP 6 BP 41 BP 9 BP 17 BP 126 531 210 2571 301 1131 94 352 107 661 121 184 11 BP -2 BP -5 BP 625 BP -12 BP 536 BP 118 1615 0.2% 0.1% 125 1628 79 1157 23.7% 13.7% 12357 18245 58288 31594 -1.8% 14219 -1.0% 21109 -1.8% 73103 -0.9% 33335 11296 17296 58169 26432 -2.6% -11.0% -15.9% -1.6% 1305 12303 2765 2694 7253 2642 9896 -2.0% 1371 1040 9937 2099 2560 5834 2366 8228 3.8% 6.3% 4.2% -3.5% 4.9% -9.0% -3.3% 1.437 111.730 1.151 24.256 268.580 4.023 0.0% -0.4% -0.3% 0.0% 0.0% 0.0% 1.49 123.3 1.4 25.4 289.6 4.12 1.26 105.4 1.1 23.9 261.9 3.83 -7.3% 2.9% -8.7% -3.1% -3.8% 1.5% 1.61% -0.3 BP 0.25% 0.0 BP 129.37 124.39 0.8% 0.1% 1.6% 0.5% 134.8 125.4 0.9% 0.2% 119.9 115.1 60.6 BP -5.0 BP 3.2% 5.3%

1T 52W H

52W L

Ytd

-1.6% 12876 -2.6% -1.7% -1.3% -1.4% 2888 3077 7600 3013

-1.5% 10892

Established markets: In the US debt dispute the proposals of both the Democrats and the Republicans have been or are currently being revised as according to calculations by the impartial Congressional Budget Office neither of the plans would result in the respective publicised savings. Furthermore, the bill previously presented by Speaker of the House of Representatives Boehner (Rep.) came in for criticism from his own party, which is why the vote scheduled for yesterday was postponed until today. Nevertheless, behind the scenes a solution is being sought at the highest level. In the Eurozone yesterday S&P downgraded Greece from CCC to CC and was at the same time the last of the three rating agencies to comment on the planned involvement of the private sector in the second bailout package for Greece. According to the agency, the planned bond swap/rollover fulfils the conditions for a selective default. The rating for Cyprus was also downgraded on the previous day. Moodys cut the rating from A2 to Baa1, giving as reasons Cypriot banks exposure to Greece and a weaker growth outlook, partly resulting from the ongoing energy shortage. On the primary market today Italy is planning to issue bonds with medium to long maturities, which will be closely observed following the increases in yields on Italian government bonds in the preceding days. Equity markets: Yesterdays news contained all the right ingredients for losses on the US equities markets: the political dispute concerning the raising of the debt ceiling is worsening, the United States Aaa rating is more and more at risk, June durable goods orders dropped by a surprisingly sharp rate and even the news from companies was a good deal worse this time. Emerson Electric (down 6.7%) is suffering from more muted order receipts, while Juniper Networks (down 20.9%) shocked the markets with a profit warning. As a result, the US equities indices also slid by between

Prices as of 28 July 11, 80:00 a.m. (CET) Source: Bloomberg

Daily Comment

1.6% and 2.7% yesterday evening, accompanied by heightened volatility, while trading volumes rose in the face of declining stock prices. Taking its cues from overseas conditions, the Japanese Nikkei 225 index dipped below 10,000 points this morning. Accordingly, European bourses also look set to open on a weaker note this morning. A plethora of corporate quarterly figures are due out today. At least some of them (Siemens, BASF) will not be able to alleviate the overall muted sentiment. Credit markets: The primary market for corporate bonds remains effectively closed. On the financial side it was announced that the planned participation of the private sector in Greeces bailout is being coordinated by the following banks: HSBC, BNP Paribas and Deutsche Bank . BNP Paribas is one of the largest bank holders of Greek debt. Moodys yesterday reiterated that Danish banks refinancing costs are likely to remain elevated owing to the tough insolvency laws. Cypriot banks were downgraded as a result of Moodys downgrade of Cyprus (incl. senior unsecured rating for Marfin to Ba2 and for Bank of Cyprus to Ba1). Emerging Markets: The stock markets in China and India are still clearly burdened today by the crisis in the US. The IGP-M inflation rate in Brazil (its broadest measure of inflation) for the month of July will be published today. The consensus anticipates a slight drop month-on-month. The central bank will also publish the results of its meeting on interest rates today. Announcements by the government that it will introduce a tax on certain FX derivatives caused the Brazilian real to fall around 1.1% yesterday. In South Africa, the producer price index for the month of June will be published today; the forecast is a 6.9% p.a. change year-on-year. CEE: There was no relevant data published yesterday in the CEE; the region is still facing the enormous influence of the uncertainties regarding the eurozone periphery. Today will also be a quiet day in terms of data on CEE. In addition to Junes unemployment figures for Hungary, which we forecast at 10.9% (formerly 11.0%), the July business sentiment in Romania will be published. Furthermore, today is the day of the local currency bond auctions in Hungary, which occur every two weeks. 3yr, 5yr and 10yr bonds with a total volume of HUF 45 billion (about EUR 167 million) are to be issued. Given the currently growing uncertainty in the financial markets, we expect the yields to have risen from their level two weeks ago. Back then, they ranged from 6.64% for the 2yr segment and 7.36% for 10yr bonds.

Market overview
current
Other interest rates EUR Eonia 1M Euribor EUR 3M Euribor EUR 6M Euribor EUR 12M Euribor EUR 2Y Swap EUR 3Y Swap EUR 5Y Swap EUR 10Y Swap EUR Other currencies EUR/GBP EUR/HRK EUR/RON EUR/SEK EUR/RUB EUR/UAH EUR/TRY EUR/BRL EUR/CNY EUR/ZAR Bond market 2Y Bund EUR 5Y Bund EUR 10Y Bund EUR 2Y US Treasury 5Y US Treasury 10Y US Treasury Interest rates CEE 3M Pribor 3M Wibor 3M Bubor 10Y Czech Rep. 10Y Poland 10Y Hungary Equity markets CEE Turkey (ISE Nat. 100) Croatia (CROBEX) Poland (WIG20) Romania (BET) Russia (MICEX) Serbia (BELEX15) Czech Rep. (PX) Hungary (BUX) Commodities WTI Oil USD/bbl Fuel oil USD/mt Diesel USD/mt CO2 EUA Fut. EUR/mt Silver USD/oz Platinum USD/oz Palladium USD/oz Steel USD/mt Aluminium USD/mt Copper USD/mt 97.3 972.0 1004.8 12.3 40.4 1781.1 828.1 613.0 2644.0 9779.0 -0.2% -0.3% -0.2% -3.5% 0.2% -0.8% 0.2% 0.0% -0.2% 115.6 1064.5 n.a. 15.8 49.8 862.3 609.0 76.9 614.5 n.a. 13.5 17.3 459.3 459.0 3.1% 27.5% 27.2% -11.9% 30.6% 0.6% 3.3% 11.9% 7.0% 1.9% 61182 2155 2689 5365 1706 713 1180 21419 -0.3% -0.4% -1.2% -0.5% 0.0% -1.6% -0.5% -1.4% 71777 57655 2338 2942 6099 1865 829 1278 1773 2373 5035 1328 600 1107 -7.3% 2.1% -2.0% 1.8% 1.1% 9.3% -3.6% 0.4% 0.8 4.6 6.1 3.9 5.8 7.4 0.0 BP 1.0 BP 0.0 BP 1.5 BP 1.0 BP 1.0 BP 0.9% 4.6% 6.1% 4.2% 6.4% 8.4% 0.8% 3.7% 5.3% 3.2% 5.3% 6.6% -3 BP 76 BP 24 BP 2 BP -24 BP -57 BP 1.27% 1.84% 2.66% 0.42% 1.54% 2.97% 0.4 BP -0.2 BP 0.5 BP -1.8 BP 1.8 BP -1.5 BP 1.9% 2.8% 3.5% 0.8% 2.4% 3.7% 0.6% 1.2% 2.1% 0.3% 1.0% 2.4% 40.4 BP -0.2 BP -30.7 BP -16.9 BP -46.7 BP -32.8 BP 0.880 7.462 4.245 9.121 39.618 11.491 2.434 2.235 9.256 9.582 0.0% 0.0% 0.0% 0.1% 0.2% 0.0% 0.2% 0.1% -0.8% 0.0% 0.9 7.5 4.3 9.5 43.9 11.9 2.5 2.4 9.7 10.0 0.8 7.2 4.1 8.7 38.8 9.9 1.9 2.2 8.5 8.7 2.5% 1.1% -0.8% 1.5% -3.1% 7.2% 15.1% 0.6% 4.7% 7.4% 0.95% 1.44% 1.61% 1.83% 2.19% 1.96% 2.12% 2.52% 3.16% -3.8 BP -0.6 BP -0.3 BP -0.3 BP -0.4 BP -0.1 BP -0.3 BP -0.4 BP -0.7 BP 1.7% 1.5% 1.6% 1.8% 2.2% 2.5% 2.8% 3.2% 3.8% 0.3% 0.6% 0.9% 1.1% 1.4% 1.1% 1.4% 1.6% 2.3% 13.6 BP 66.0 BP 60.6 BP 60.1 BP 68.3 BP 40.1 BP 22.8 BP 3.0 BP -16.5 BP

1T 52W H 52W L

Ytd

24531 20147

1886.5 1489.0

2803.0 1982.3

-0.4% 10190.0 7028.3

Prices as of 28 July 11, 07:55 a.m. (CET) Source: Bloomberg

Daily Comment
This report was completed on 28 July 2011

Acknowledgements

Editor
Raiffeisen RESEARCH GmbH A-1030 Vienna, Am Stadtpark 9 Tel: +43 1 717 07-1521 Head: Peter Brezinschek (1517) Research Sales: Werner Weingraber (5975) Economics, Fixed Income, FX: Valentin Hofsttter (Head, 1685), Jrg Angel (1687), Wolfgang Ernst (1500), Gunter Deuber (5707), Julia Neudorfer (5842), Matthias Reith (6741), Andreas Schwabe (1389), Gintaras Shlizhyus (1343), Gottfried Steindl (1523), Martin Stelzeneder (1614) Credit/Corporate Bonds: Christoph Klaper (Head, 1652), Christoph Ibser (5913), Igor Kovacic (6732), Martin Kutny (2013), Peter Onofrej (2049), Gleb Shpilevoy (1461), Alexander Sklemin (1212), Jrgen Walter (5932) Stocks: Helge Rechberger (Head, 1533), Aaron Alber (1513), Christian Hinterwallner (1633), Jrn Lange (5934), Hannes Loacker (1885), Richard Malzer (5935), Johannes Mattner (1463), Christine Nowak (1625), Leopold Salcher (2176), Andreas Schiller (1358), Connie Schmann (2178), Magdalena Wasowicz (2169) Quant Research/Emerging Markets: Veronika Lammer (Head, 3741), Mario Annau (1355), Lydia Kranner (1609), Nina Kukic (1635), Albert Moik (1593), Manuel Schuster (1529) Technical analysis: Stefan Memmer (1421), Robert Schittler (1537)

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