Economists expect UK to lose AAA credit rating

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Britain is expected to lose its gold-plated AAA credit rating this year, dealing a blow to George Osborne's defence of deep spending cuts as the key to retaining Britain's status with global investors. According to many economists at least one of the three main credit ratings agencies – Moody's, Fitch or Standard & Poor's – will declare the UK a bigger lending risk in response to Osborne's admission in the autumn statement that austerity will run for at least eight years until 2018, rather than the original five years. But hose same economists largely agree that in a world where most developed ... (Read the full story)

Budget deal may not halt sequester – CNBC

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CNBC says budget talks are expected to continue all day, citing sources. They say any deal may not turn off the sequester. (Read the full story)

S&P500 Technical Update December 31st 2012

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S&P 500 futures are trading just above the key 1380 – 1384 technical zone in electronic trading today. This technical area marks the 61.8% Fibonacci retrace of 1340.25 > 1445.75, and the prior swing lows from late November to date. This previous price action support level could come under pressure on Monday – when the cash markets open – if US lawmakers fail in their ongoing attempts to strike an agreement. This is needed in order to avoid a reported $600 billion in tax hikes and spending cuts which could hurt economic growth heading into 2013 . (Read the full story)

Senator Reid says fiscal cliff talks `progressing'

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BREAKING (Read the full story)

Politics Not Economics Push FX into Year End

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It seems only fitting that politics, which have shaped the investment climate to such a large extent this year, dominates on this last day of 2012. To be sure though, activity is thin and it seems only those who must transact are. The US dollar itself is mixed. It is slightly firmer against the euro, Swiss franc and yen, while softer against the dollar-bloc (which had lagged last week) and sterling. It is also mixed against emerging market currencies. Equities are mixed, though on the back of a stronger China PMI (from HSBC), the Shanghai Composite tacked on 1.6%, extending its impressive recovery ... (Read the full story)