Tech Stocks Hit Again After Weak Data – Nasdaq Off 1.35%
US tech stocks took another hit in trading yesterday after Consumer Confidence numbers came in a lot lower than expected. The Dow pushed 0.37% higher, but the tech‐heavy S&P and Nasdaq suffered, losing 0.47% and 1.35% respectively. Treasury yields took another tumble and are well off highs seen just a few weeks ago; the 2‐year lost 7.4 basis points to move down to 4.094%, and the benchmark 10‐year fell 10.6 basis points to 4.294%. Oil prices took a hard hit as demand concerns increased – Brent off 2.11% to $73.20 and WTI down 2.50% to $68.93 a barrel – whilst gold dipped 1.19% to $2,916.59 as more profit‐taking flow hit the market.
Treasury Yields Could Push the Dollar Lower
FX traders will be keeping a close eye on US Treasury yields over the following days, as they have taken a beating in the last week with US data continuing to come in below expectations. Last night’s weaker‐than‐expected US Consumer Confidence data led to the benchmark 10‐year yield hitting its lowest level in 10 weeks as investors piled into treasuries. The uncertainty regarding President Trump’s policies – and particularly his tariff plans – is now filtering strongly through to US markets, and the pressure on yields could flow through onto the dollar. The contrarian view, however, is that this is just a clear‐out move, and tariff threats from just a day or so ago could lead to inflationary pressures and see yields rebound strongly – and with it, the dollar. Once again for many, it looks like more headline volatility ahead!
Event Calendar Picks Up for Traders Today
The event calendar has been relatively bare so far this week, and the impact of last night’s Consumer Confidence number in the US shows how much traders are now looking for fundamental data to back up recent moves. The event calendar does pick up from today and increases as we move through the week. The initial focus in the Asian session today will be on Australian markets, with the key CPI data due out early in the day – the expectation is for a 2.6% increase for the year-on-year data, and anything off this will see strong moves in the Aussie. There is little on the calendar in Europe, but we do have more data out from the US once New York opens; New Home Sales data is due out early in the day, before we then have the usual weekly US Crude Oil Inventory data.
