Markets Going Nowhere

Published by Filipe R. Costa on Tue, 14/08/2012 - 11:11
road to nowhere

Daily Market Commentary for August 14: We have a boring situation here. Markets are moving in circles since the start of August. Until there are some news from central banks, it seem investors don’t want to risk much, if interested at all.

Investors are in waiting mode, hoping the Federal Reserve can bring some good news in September with another round of quantitative easing but don’t want to risk too much anticipating such a move now. The FTSE, and the Dow are moving in circles. When they go up, there is always selling interest to bring the indices down, but there is always buying interest when the drop is accentuated.

The Euro has recovered a little and is now on track to hit 1.24 again but suffered a little from poor data released this morning. GDP for the Eurozone decreased 0.2 percent in the second quarter in line with expectations but nevertheless a drop from the last registered 0.9 rise in quarter one. The ZEW survey shocked with a reading of -25.5 relating to the economic sentiment in Germany. Analysts were pointing to a reading of -19.6 in line to last month’s value but it seems there is more deterioration that first thought.

This morning nothing is different from yesterday as equities started the day rising but are again moving in circles. This is the perfect time for a vacation since spread betters have more chances of losing money with these movements than making something out of it. Low volatility, erroneous movements, lack of liquidity, are ingredients for a stay-out-of-the-market recipe.

Name Last price Close Price % 5-Day % YTD %
CAC 40 13/08/2012 3426.41 -0.27 0.73 8.44
Crude oil (Light Sweet) Composite 13/08/2012 92.59 -0.76 0.74 -6.47
DAX (Xetra) 13/08/2012 6909.68 -0.5 -0.13 17.15
Dow Jones Industrial Average 13/08/2012 13169.4 -0.29 0.4 7.79
EUR/GBP - £ per Euro 13/08/2012 0.7863 0.41 -1.06 -5.63
EUR/USD - US$ per Euro 13/08/2012 1.2326 0.33 -0.49 -4.85
FTSE 100 13/08/2012 5831.88 -0.26 0.4 4.66
FTSE MIB 13/08/2012 14533 -0.11 1.33 -3.69
GBP/USD - US $ per £ 13/08/2012 1.5676 -0.06 0.58 0.94
Gold (LBM) $ 13/08/2012 1616.8 -0.34 0.14 3.18
IBEX 35 13/08/2012 7069.6 0.31 0.23 -17.47
Nasdaq 100 Index 13/08/2012 2728.68 0.21 1.28 19.79
Nikkei 225 13/08/2012 8885.25 -0.07 1.82 5.09
S&P 500 13/08/2012 1404.11 -0.13 0.71 11.65