What Are The Markets Expecting From The Upcoming Data Releases?
The markets market seem to be
positioning themselves defensively ahead of Thursday’s ISM survey and
Friday’s jobs report. As a result,
equities and the US dollar were weaker whereas bonds and gold were higher. On
the month however, the S&P advanced by 8%, the Nasdaq over 9% and the Dow
over 6%. So at this point a pullback in the coming sessions should not come as a
surprise to investors.
Equities
Again, the equity markets had a good run this
month but closed lower on the last day, today, after a weaker than expected
Chicago PMI number (which is usually a good indicator of the ISM reading).
The Nasdaq was down, as Tech related stocks were pushed lower after Bank of
America cut its ratings on Dell, EMC Corp and Network. The index futures
contract
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down a slight .30 to finish at 915.80,
and the Dow
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finish at 8450.
Fixed Income
The Treasury markets were firm today on the back
of soft economic data and Mr. Greenspan’s comments to the House, suggesting that
interest rates may remain low for the time being. The Treasury market was also
buoyed by the expectation that tomorrow’s ISM survey will lack any positive
indication that the manufacturing sector is improving. The 10 year futures contract
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was up 190 to close at 115-040; the 30 year
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0-30; and the five year note
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up 0-150 to close at 113-240 , breaking outside of its recent trading
range.
Metals
Gold
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struggled, climbing 5.4 to finish at 339.40. Silver
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9.00 to finish at 4.6380. The industrial metals also finished
higher as the market is becoming less concerned about a worst-case SARS
scenario in China. As a result, copperÂ
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HGK03 |
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PowerRating) was up .15 at 72.50 and
aluminum
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Energy
The oil market was due for a correction today and
got one, as crude oil snapped its six-day losing streak today on the back of
lower-than-expected US crude inventory gains. The market had been looking for an
increase of 2.3 million barrels but received an increase of 1.8 million barrels
instead. In other oil related news, oil producer, Norway, announced today that
it would not help OPEC cut production this time around, as it has in the past.
June crudeÂ
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PowerRating) was up .56 cents at 25.80. Natural gasÂ
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Currencies
The US dollar was lower across the board today on
the back of speculation that interest rate differentials between the US and some
of the other major currencies (mainly the euro) will continue to favor the
latter. This belief was predicated by softer US data and higher-than-expected
European inflation numbers–which would prevent the European Central Bank from
cutting rates. The USD index
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DX03H |
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PowerRating) was down .82 and
finished at 97.38.