Us equities traded mixed yesterday with only the DJIA managing to advance on its record highs which were made this week, the DJIA continues beyond the 20k mark while the S&P 500 and Nasdaq 100 lost marginal ground as investors took a breather. Asian equites traded mostly higher with the Nikkei 225 gaining 0.4% and the ASX posting gains of 0.6%. Global markets remain sensitive to the US`s lead and favorable moves in the US markets will be reverberated by other markets too.
In FX, the USD regained its composure as the USD index, the measure of the USD`s strength verse its counterparts, found strong support at the 100 level, moving higher as it closes in on the 101 level. The EURUSD dipped below 1.0675, the GBPUSD gave back over 100 pips to trade back around the 1.2550 level while the JPY extended its loses against the USD to trade above the 115.00 level.
USD an US equity traders have a number of economic events to keep them busy today with both bulls and bears likely to watch the releases closely as they look to advance their respective agendas. The Advanced GDP q/q, expected at 2.1%, will be scrutinized as to how the US economy is growing with a better than expected release likely to see the USD and equities rally further as markets price in improving economic health while a worse than expected release will have the opposite effect as traders sell of the assets in a bid to price in slowing conditions. Traders will also be looking at the Core Durable Goods Orders m/.m, expected at 0.5% as they look to determine how the production sectors in the US are doing with rising orders signaling that manufacturing will see an uptick which would result in a stronger USD and bolstering of manufacturing stock prices. On the other hand, a worse than expected figure would imply a slowdown in manufacturing which would weigh heavy on the USD and the manufacturing sector.
To top it all off we see the release of the Revised UoM Consumer Sentiment figure, expected at 98.2. The figure is a depiction of consumer confidence which has long reaching effects on economic growth, with an increased sentiment implying consumer will be spending money, stimulating the US economy, increasing the demand for the USD and keeping equities bid while a worse than expected release will see the opposite occur as trader’s price in a slowdown in consumer spending and the economy at large.