U.S. equity markets traded mostly sideways following a favorable U.S. Durable Goods Report and an improved U.S. New Home Sales Report. After an early session thrust to the upside failed to take out yesterday’s highs, the major stock indices sold off and settled into a range.
September Treasury Bonds firmed into the close as the Treasury completed another well-received auction. Foreign central banks were rumored to be the large supporters of the auction. Sideways equity markets helped contribute to the support.
The U.S. Dollar closed higher against all major currencies. The September Euro weakened after a better than expected U.S. New Home Sales Report. Traders are trying to determine whether the Dollar or the Euro sets the pace for the economic recovery.
The September British Pound turned down on the daily chart as traders triggered by bearish traders who feel the U.K. will lag the U.S. and Euro during the recovery. Lower oil prices and negative comments from a Bank of Canada official helped weaken the September Canadian Dollar.
December Gold traded sideways on Wednesday. This market decided to buck the trend and break away from its relationship with the Dollar for at least one day. Without inflation to guide it, this market’s direction will be dictated by the U.S. Dollar.
December Crude Oil finished lower influenced by a less than friendly fundamental report. A 200,000 barrel increase in crude inventory completely missed the pre-market guesses of a 2.7 million barrel drawdown.
