Fall in US consumer confidence reins in Wall Street

Wednesday, February 26, 2014

US equity markets slipped lower on weaker data as investors took advantage of a profit taking opportunity after the S&P 500 touched a record high on Monday. Both the S&P 500 and DJIA pared Tuesday’s gains as they closed 0.13% and 0.17% lower respectively, swinging between gains and losses throughout the session. Consumer confidence fell in February to 78.1 from 79.4 the previous month, prompting 10 year treasury yields to pullback towards 2.7023% on Tuesday as investors piled into safe haven assets. Spot gold prices rallied for the fourth consecutive session on the shift in sentiment, pushing towards the highest level since November last year as the yellow metal approached $1,343. Prices have since opened higher today as Asian investors broadly follow US sentiment lower.

Asian equity markets experienced a mixed session yesterday with Chinese investors taking advantage of a buying opportunity in both the Shanghai Composite and CSI 300 after both indices lost 5.5% and 6.8% respectively in the recent sell-off. Both indices ended the session moderately higher as money market rates fell further as the PBOC attempted to boost liquidity. Japanese equity indices followed the US session lower with the Nikkei losing 0.54% and the TOPIX closing 0.67% lower.

Second month NY raw sugar contracts struggled to extend gains as contracts experienced firmer resistance on the close around 17.70 cents per lb while intraday highs testing 18.00 cents per lb were aggressively sold-off. Momentum indicators still suggest the potential for further gains as MACD, RSI and stochastics all confirmed the new high; however, prices have struggled to breakout above the current area in the past which may see further consolidation in the coming sessions.

 US Consumer confidence falls in February

CONCCONF Index Conference Board 2014 02 26 07 31 20

Chinese 7 day repo rate falls on PBOC intervention to increase liquidity

RP07 Index CHINA INTERBANK REPO 2014 02 26 07 53 27

2nd month NY raw sugar contracts take a pause, hitting resistance around 17.70-18.00

SB2 Comdty Generic 2Nd SB Fut 2014 02 26 07 51 49

Events for today

0700

DE

Mar

GfK Consumer Sentiment

1530

De

Jan

Retail Sales

1500

UK

Q4

GDP

1500

US

Jan

New Homes

1530

US

w/e

EIA Energy Stocks

LT: 

Feb  Copper, Gold, Silver (COMEX)      

 Economic Market Calendar

Topics: Equities, Gold, Sugar
More from: Kash Kamal