Mixed Day for US Markets – Nasdaq Drops 0.8%
It was a mixed day for US markets yesterday as the optimism from the previous day’s trading quickly subsided. All three major US stock indices declined, with the Dow losing 0.16%, the S&P 500 falling by 0.21%, and the Nasdaq dropping 0.81%. US Treasury yields also retreated further, with the 2-year yield losing 3.4 basis points to settle at 4.230%, and the 10-year yield dropping 4 basis points to 4.613%.
Oil prices fell from their previous day’s surge, with Brent crude losing 0.9% to settle at $81.29 per barrel, and WTI crude declining 1.7% to $78.68. Meanwhile, gold prices pushed higher, nearing levels not seen since mid-December, finishing the day up 0.8% at $2,716.91.
Gold Pushes Higher on Market Uncertainty
Gold prices climbed higher in trading yesterday, nearing highs last seen in both November and December of last year. This rise was supported by weaker US Treasury yields, a softer US dollar, and increasing market uncertainty stemming from recent US economic data and the forthcoming transition of government power next week.
Traders are now watching for a clear break above the recent highs, just above $2,725, which could push the precious metal into a new trading range and potentially towards the all-time high of $2,790.15. Many expect heightened market volatility surrounding Donald Trump’s inauguration on Monday. Should the incoming government deliver unclear or conflicting signals on policy direction and implementation, gold prices are likely to continue their upward trajectory.
More Busy Markets to End the Week
Traders are anticipating another active trading day to close the week, with a variety of significant data releases scheduled across global markets. The most notable data drop comes during the Asian session, with key releases including GDP, Industrial Production, and Retail Sales figures from China expected mid-day. In the London session, the focus shifts to the UK’s Retail Sales data, with an anticipated month-on-month increase of 0.4%. Meanwhile, the US session will see the release of Building Permits data, which is unlikely to have a substantial impact. Traders will also continue to analyse inflation and Retail Sales data from earlier in the week as trading unfolds.
