Wall Street turned in its best performance in two months on Tuesday as the major indexes all gained. The question going into today’s session will be if momentum will keep up. Investors cannot be faulted for thinking that yesterday’s equities action may have been bottom feeder inspired as some participants sought bargains. Retail Sales numbers came from the States yesterday and they were better than anticipated, but it needs to be noted that the outcome was minus -0.2% which was only slightly above the negative estimate of minus -0.3%. Ben Bernanke also got into the act yesterday as he delivered a speech warning U.S. lawmakers that they ought to raise the American debt ceiling to avoid undue pressures on U.S. obligations.
Today the U.S. will release the Empire State Manufacturing Index reading and Industrial Production numbers. But in actuality the key focus for investors who are geared towards the American markets will be on the gains made on Wall Street from Tuesday and where sentiment will go today. The U.S. has been producing lackluster economic data for an uncomfortable duration and this will be weighed against other international conditions which are not bright either. The USD continues to trade in a range against the EUR that seems preconditioned to balance between the weaker U.S. growth outlook and the debt crisis that is continuing from Europe. Crude Oil Inventories data will come from the U.S. too. The price for Crude was still below 100.00 a barrel yesterday.
European ministers failed to complete a draft resolution for the Greek bailout package yesterday. This occurred as infighting continues behind closed doors as governments and officials continue to disagree about implementation of certain austerity measures. The crux of the matter which seems to be finding voice is that no matter what is decided upon in these coming days, the long term Greek debt problem will not be solved. The Greek public will see a series of public strikes and demonstrations starting today. The EUR has actually maintained its value quite well in the wake of the debt crisis saga which refuses to vanish. Industrial Production numbers will be published from the European Union today and a result of minus -0.1% is expected. However let there be no doubt that the EUR sentiment is being generated from the debt story and this is not going to change anytime soon.
The GBP like the EUR essentially traded in range on Tuesday. The DCLG HPI produced negative housing numbers yesterday which confirmed that the U.K. like its counterparts continues to wallow in a housing market that is producing little in the way of greater wealth. Employment data will come today and tomorrow Retail Sales figures will be published. The GBP has found itself in what has become a ranging value. Traders who have the stomach for short term movements may find opportunity within the Sterling.
The AUD produced strong gains yesterday and interestingly enough this came about as Gold faced a volatile day of trading. The precious metal is near 1523.00 USD as of this writing. Although the value of Gold may look at first glance like it has been in a consolidated range it should be noted that its trading has been swift and it appears that Gold may be ready to make news again. Plenty of risk adverse trading continues and this has created a rather volatile mix for Gold. The AUD is within the higher reaches of its value, but offers some diverse possibilities taking into consideration the rather troublesome global economic outlook that many analysts are harboring. The JPY has moved to a slightly weaker part of its rather strong range against the USD and the question for the Japanese currency today will likely be when its range dance will effectively be seen again. The Forex and Commodities markets appear ready for another day of trading which will see impetus come from existing cautious sentiment.
Written by bforex.com
