Stocks Drop Again – Nasdaq Off over 1%
US markets had another tough day to start the week as investor confidence continues to slide south, the major indices all finished the day lower. The Dow didn’t fair too badly and closed only slightly off flat, however, the S&P and Nasdaq both took hits, down 0.45% and 1.16% respectively. Trouble in Russia over the weekend affected certain markets with Oil taking a step up and the Ruble taking a big hit, trading to a 15-year low against the greenback. Other currency pairs remained trading in very tight ranges ahead of data and central bankers later in the week and US treasury yields edged lower.
Gold Looking for Support
Gold bulls have had a tough time of it over the last couple of months as its safe haven lustre has lost a bit of shine and the dollar has come back strongly on the back of more anticipated rate hikes in the US. The shiny metal has dropped just under 8% since trading at the lofty heights above $2,070 in early May and broken some key support levels on the way down, but market concerns may give it some strength as we move into the second half of the year. Geo-political issues such as we witnessed over the weekend in Russia will generally lead to a rally as will overall risk aversion across markets and some investors are calling for just that in the current environment. It has found some support around the $1.910 level over the last week and there should be Fibonacci support just under $1,900. Topside initial resistance now sits at $1,946 with the longer-term target back at that May high.
Busy Trading Calendar Day Ahead
As anticipated it was a relatively range-bound day for most markets yesterday with very little on the events calendar to excite traders, however, today is shaping up to be more volatile as we see some key data releases and the start of the major ECB central bank conference in Sintra. The Asian session draws a blank for us in terms of major releases, but once we hit the European session, we have the start of the Sintra Forum and ECB President LaGarde is due to speak. The New York session sees the first real data of the week for the market to get its teeth into with the Canadian CPI numbers and the US Durable Goods data coming out at the same time, followed later by the US CB Consumer Confidence release.
