General Market Comment
US indices closed mixed on Thursday even though the Dow had its best January in the last 30 years. Shares in the Materials (-1.54%), Banks (-1.21%) and Software & Services (-0.52%) sectors took a hit while shares in the Media (+4.13%), Telecommunication Services (+2.16%) and Utilities (+2.08%) sectors ended in green territory. On the economic data front, initial jobless claims jumped to 253k in week ended January 26th (estimated 215k) from 200k in the previous week while continuing claims increased to 1.782M in week ended January 19th (forecasted 1.721M) vs. 1.713M a week earlier. Employment cost index improved by 0.7% in 4Q (expected 0.8%) compared to 0.8% in the previous quarter. In other news, the Chicago PMI fell to 56.7 in January (estimated 61.5) from 63.8 in December. Also, the Bloomberg consumer comfort index remained unchanged WoW at 57.4 in week ended January 27th. Finally, new home sales jumped to 657k in November (forecasted 570k) compared to 562k in October. The S&P 500 (2,704.10) stays above its 20d moving average (2,612.26 – positive slope) and 50d moving average (2,609.66 – flat slope).
European markets are expected to open on a flat note.
Foreign Exchange
The US dollar was bearish against most of its major pairs on Thursday with the exception of the EUR. On the economic data front, initial jobless claims jumped to 253k in week ended January 26th (estimated 215k) from 200k in the previous week while continuing claims increased to 1.782M in week ended January 19th (forecasted 1.721M) vs. 1.713M a week earlier. Employment cost index improved by 0.7% in 4Q (expected 0.8%) compared to 0.8% in the previous quarter. In other news, the Chicago PMI fell to 56.7 in January (estimated 61.5) from 63.8 in December. Also, the Bloomberg consumer comfort index remained unchanged WoW at 57.4 in week ended January 27th. Finally, new home sales jumped to 657k in November (forecasted 570k) compared to 562k in October.
The Euro was bearish against all of its major pairs. The euro-zone GDP growth was 1.2% in 4Q on a yearly basis in first estimation, as expected, vs +1.6% in the previous quarter. The German retail sales dropped by 4.3% in December (-0.6% expected) vs +1.6% the month before (revised from +1.4%). According to Nationwide, the UK house prices rose by 0.3% in January (+0.2% anticipated) after a 0.7% slide in December.
The Australian dollar was higher against all of its major pairs.
Commodities
After the close of Wall Street, WTI Crude Future (MAR 19) was about flat to $54.01. The contract was above its 20D MA (@ $52.01) and above its 50D MA (@ $51.01).
Gold was about flat to $1320.6. The precious metal was above its 20D MA (@ $1293) and above its 50D MA (@ $1267). The 14d RSI above 70 (71.65) indicates gold was overbought.
Copper Future (MAR 19) on Comex was up 1.6c to 278.35c/lb. The contract was above its 20D MA (@ 267.25c) and above its 50D MA (@ 271.24c). In Europe, the London Metal Exchange reported its copper inventories increased 100 tons to 149200 tons