Rally Loses Steam

Published by Filipe R. Costa on Tue, 11/09/2012 - 11:48
train climbing

Daily Market Commentary for September 11: The rally occurring last week, especially on Friday, is now losing steam and investors prefer to wait on the sidelines for the result from the FOMC meeting to be held next Thursday.

The equity market has been driven by monetary policy lately and this week is no exception as investors are waiting for the results from the next FOMC meeting. The general sentiment is that Ben Bernanke will now pull the trigger and launch a non-sterilised bond-buying program - QE3 - to help the economy. The latest jobs market data has been poor as payrolls grew just 96,000 and Ben Bernanke has been stating he his willing to intervene if jobs don’t pick up. This way, investors think the odds for QE3 being launched this week are in their favour.

At CutTheSpread we still think there is a risk QE3 is not for now, such that gold traders should be aware.

Burberry issued a profit warning and was trading down 17%. The company said in an unscheduled event it will miss this year targets. The news is hitting retailers and concerns are mounting. At the time of writing the FTSE is trading around 5,765.

Name Last price Close Price % 5-Day % YTD %
CAC 40 10/09/2012 3506.05 -0.37 1.52 10.96
Crude oil (Light Sweet) Composite 10/09/2012 9628 -0.05 -0.6 -2.75
DAX (Xetra) 10/09/2012 7213.7 -0.01 2.83 22.3
Dow Jones Industrial Average 10/09/2012 13254.29 -0.39 1.25 8.49
EUR/GBP - £ per Euro 10/09/2012 0.7994 -0.14 0.86 -4.06
EUR/USD - US$ per Euro 10/09/2012 1.2797 -0.15 1.68 -1.21
FTSE 100 10/09/2012 5793.2 -0.03 0.6 3.96
FTSE MIB 10/09/2012 16092 -0.11 5.4 6.64
GBP/USD - US $ per £ 10/09/2012 1.6008 -0.01 0.81 3.08
Gold (LBM) $ 10/09/2012 173140 -0.18 2.27 10.5
IBEX 35 10/09/2012 7857.7 -0.32 5.7 -8.27
Nasdaq 100 Index 10/09/2012 2788.35 -1.3 0.58 22.41
Nikkei 225 11/09/2012 8807.5 -0.7 0.36 4.17
S&P 500 10/09/2012 1429.08 -0.61 1.6 13.64