Stocks and Gold Hit New Records – Dow up 1.85%
US Stock markets jumped yesterday as a combination of strong Retail Sales and stellar earnings from the big banks pushed both the Dow and the S&P to record closes. The Dow powered 1.85% to record an all-time high close of 40,954 closely followed by the S&P which added 0.64% and lagged by the Nasdaq which only managed at 0.20% gain as investors continued to diversify their portfolios. US Treasury yields slipped to levels not seen since mid-March, the 2-year losing 0.5 basis points to 4.447% while the 10-year lost a more significant 6 basis points to drop to 4.167%. Currencies remained largely rangebound and Oil took another dip as concerns on dropping demand out of China continued to weigh on markets, Brent off 1.3% to $83.73 a barrel and WTI losing 1.4% to close around $80.76 a barrel. Gold, however, had another standout day hitting a fresh all-time high again, adding over 2% on the day to close the New York session at $2,468 an ounce.
Gold Powers Higher as Stars Align
Gold bulls celebrated another record high in trading yesterday as the stars aligned to drive the precious metal through the previous record set in May. A combination of geo-political uncertainty across the globe and anticipated rate cuts in the US helped the move higher with the attempted assassination of Donald Trump on the weekend increasing investors urgency to load up on the haven asset. Recent US data is pointing to pending rate cuts from the Fed with the market now pricing in three cuts before the end of the year and the odds for another Trump presidency have increased after this weekends shooting incident. Traders will continue to look for levels to buy in the current market conditions with any pullbacks likely to attract investors in the coming sessions.
More Volatility Ahead for Traders Today
Global markets traders are preparing for more volatility in ahead in trading sessions today with equities and Gold looking to push further in buoyant conditions. We have already seen key inflation data out early in the Asian session in New Zealand with the headline quarterly CPI number coming in slightly under market expectation – the kiwi has since rallied as other components in the data have indicated that underlying inflation is falling less than expected. There is little else due out in the Asian session, however the focus will be firmly on the UK economy on the London open when the latest UK CPI data is released – expectation is for the headline year-on-year number to drop 0.1% to 1.9%. There are Building Permits and Industrial Production numbers due out of the US once the New York session commences and traders will be paying close attention to what the FOMC’s Christopher Waller has to say later in the day.
