US Markets Hit Again – Nasdaq down over 1%
It was a bit of a Groundhog Day for US markets as stocks once again took a bashing and the dollar and US treasury yields pushed higher. The major indices all finished well in the red, the Dow down 0.52%, the S&P down 0.76% and the Nasdaq closing negative 1.15%. The Federal Reserve Bank meeting minutes confirmed what the market had been suspecting that there is still a possibility that interest rates can increase more, and this added further fuel to the fire. Oil took another hit as the dollar strengthened and concerns that demand from China will continue to wain piled pressure on the black gold, WTI now trading back under $80/b and Gold dropped under $1,900/oz.
Buy Dollars Wear Diamonds
It’s an old market saying, but it has certainly rung true for the last month as the greenback has dominated currency markets on the back of interest rate differentials and haven attraction. It has pushed higher in 18 of the last 24 sessions and is starting to hit historic levels against a number of other currencies. It hit a record high against the Indian Rupee this month and it’s threatening to do the same with the offshore Chinese yuan whilst in the majors it has taken out yearly highs against the Japanese yen, the Aussie dollar, and the Kiwi. For the moment most currency traders are listening to another old adage and trying not to ‘stand in the way of a freight train’ and are looking for levels to jump on the back of the move and get long of the greenback.
More Data Ahead for Battered Investors Today
Investors have had a bit of a tough week so far and last night’s FOMC meeting minutes have not helped sentiment, as doom and gloom seems to dominate current thinking. Traders are hoping for some silver lining to come from data today and Australian markets will get the first chance with the release of the latest employment data down under early in the Asian session. There is little out in the way of tier 1 data for the rest of the session and indeed in the European time zone as well. The US Day does have couple of major releases out in the form of the weekly Unemployment Claims and the Philly Fed manufacturing Index and traders will be hoping that these will come in a little bit more favorably for markets.
