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China has beat Japan as the second-largest economy in the world. With an average GDP growth of 10% for the last 30 years, a population of 1.4 billion, first place in the world’s and consumption and production of coal, steel and energy, and the world’s largest exporter and second-largest importer of good, the country stands a chance at becoming number one soon. (It is also ranks first-place in the world in coal production).

Other news in China is the country’s allowing foreign investors to invest in the Chinese market. A pilot program will allow foreign investors to buy bonds in the Chinese market using Chinese currency.
Shanghai is set to become a world leader in finance by 2020. As a result, they are tapping into corporate investment abroad and could allow foreign companies to sell shares in Shanghai as early as next year. Rumor persists that Shanghai may allow foreign investment in yuan-dominated private equity and venture capital funds as well in the near future.

Since the yuan ended its peg against the dollar on June 19 it has risen by .5 percent. Announcement of the end of the peg causes a 4.8 percent increase in Hong Kong yuan deposits in June. China is now making it easier for yuan transactions between banks and companies in Hong Kong as well as those transferring cash in order to buy wealth-management products.
The rise of the yuan currency combined with rising sentiment about China’s future could make it a good short-term investment for binary options and forex traders.

Major Events of the Week

A short look at the week’s closing:

Stock Market Summary
The Dow Jones Industrial average fell by 164 points at one point and closed at 10120.53
S&P Stock Index fell by 13.89 points to close at 1069.59
The Nasdaq fell by 35.16 points to close at 2,187.33 due to the drop in technology stocks.

Commodity Market
Oil dropped to below $78 a barrel

Currencies
Dollar rose against the Euro
Yen rose against the dollar

Stock Markets Summary – These are the quotes from the end of the day on Friday
Dow Jones Industrial Average – ended at 9,686.48, a 5% drop for the week.
S&P- Dropped 4.79 points, a drop of 5% for the week.
NASDAQ- Dropped 9.57 points to 2,091.79.

These are the major events from this month:

Currencies
The dollar index ended last week at 84.41, reaching its lowest level in two months.

Savings and Consumer Spending
Spending rose slightly higher in May compared to April, suggesting increased consumer confidence. Savings also rose compared to last month.

Commodity Market
Oil- Crude oil prices for August fell to $77.96 a barrel.
Gold- COMEX gold’s August contract fell $16.60 to $1,239.20 per ounce. Gold futures rose a dollar in expectation of the holiday weekend.

Employment
The jobless rate decreased by .2%, from 9.5% in June from 9.7% in May.
Nonfarm payrolls for June fell by 125,000, whereas private payrolls for June increased by 83,000, which is an improvement from the 33,000 private payrolls that were added last month.
New claims for unemployment benefits unexpectedly rose by 13,000 in the week ended June 26 to 472,000, the Labor Department said, a sign that companies remain reluctant to hire.

Sales and Manufacturing
Retail sales fell in May for the first time in eight months. The manufacturing index fell 3.5 points in June to 56.2, the lowest level this year.

Housing
Home sales declined last month to 300,000, a 32.7% decrease from 446,000 the previous month.

Binary options really came of age in 2008, with the addition of them to the Chicago Board of Exchange (CBOE) and the North American Derivatives Exchange (NADEX). Since then, their popularity has exploded among both the financial trading and gaming industries.
Once offered in these major financial exchanges, they became a part of the exchange market and brought government regulations and taxes.

In traditional trading, traders predict the precise value of stocks in the future, buying a contract for that amount. The expiration date can be set several months or weeks in advance. As the price increases or decreases, the owner of the future can buy more futures contracts or sell them. With binary options, contracts expire much more quickly, and traders simply wait out the trade until the time of expiry instead of buying and selling up until the time of expiry. Although it is much less flexible for traders, it is also much simpler. Some more experienced traders see binary options as a means for beginning traders to get experience trading in the traditional market. Then again, many experienced traders are now getting involved in the binary options market!

With its exponential increase in popularity we have witnessed the same principles of binary options trading applied to fixed-odds gaming on the weather, television shows, sports, and political events. There are hundreds of online sites with fixed-odds gaming of different teams and events from all over the world.

Oil Prices

Among the different developments likely to influence oil prices for both the short and long-term future are:

After the BP oil catastrophe, President Obama banned drilling in US waters deeper than 500 feet on May 30, opponents of the ban warned of a possible surge in oil prices.

Futhermore, his decision to delay drilling near Alaska until 2011 caused deep concern to oil companies already expected to open operations in that area, ConocoPhillips and Shell Oil Co. Opponents of the regulations warn of unemployment rising in the oil industry in particular and related industries as well as fewer jobs will be available than expected.

In addition to the ban additional regulations were proposed by government officials that include increasing standards and frequency of safety inspections of rigs and platforms operating in the Gulf of Mexico.
The question remains as to what these regulations will do to the price of oil and the price of stocks of oil companies over the long and short term.

A Hungarian spokesman for Prime Minister Viktor Orban has announced last week that an impending economic default is possible given the current economic situation. This combined with past concern over other shaky economies, such as Portugal and Spain, caused increasing fears of the value of the Euro, which fell to a new low of 1.2050 against the dollar.

The spokesman, Peter Szijjarto, accused the past government of covering up lies and information. A detailed report of the Hungarian government’s fiscal plans.should soon be released.
The Daily Forex News reported today that in a Eurogroup meeting yesterday that Eurogroup head and Luxembourg Prime Minister Jean-Claude Junker was “not really concerned about Hungary” and emphasized that the situation was not at all comparable to the economic situation in Greece.

The Hungarian report on its fiscal budget should play a big part in investor confidence in the Euro, which will affect Euro prices.

Source: Gold Alert

Market analysts speculate that gold could be the next bubble, as large investors continue to buy gold along with other commodities as a safe investment against the rising economic instability in Europe and now Asia.

Developing countries have simultaneously been buying gold as a safe and secure place to store monetary assets.

Both reactions have caused a rise in the price of gold over in the last week of May even though demand has fallen in the first quarter of 2010. But what is more interesting is that gold prices are extremely sensitive to sentiment, or people’s perception of the value of the commodity.

Financial investors are largely responsible for the market price of gold, who decide whether they believe the price of gold will rise, and then invest in gold. This causes the price of gold to rise even further, as investor sentiment rises.

The price of gold has been known to fall in times of wealth and economic prosperity, however.  In times of severe economic hardship, as in ware or economic collapse, it has been known to be a fairly liquid investment which can be easily traded for money.

Markets Pulse is attending the iGaming Super Show in Prague from May 25- 28. You can see a list of attendees from Facebook and LinkedIn.

You can see a demonstration of our product from our staff that is attending. For more information contact us via Twitter or contact us directly at info@marketspulse.com.

Rackspace has announced Jivy Group as Partner of the Month for May. Jivy Group specializes in web development solutions, bringing one-stop solutions to clients. Among its platforms are a live casino solution, a skill games platform and a binary options trading platform.