Improvement in Consumer Confidence Expected Today – Bernanke will be Reappointed Fed Chairman

The metals are trading a shade higher in advance of this morning’s economic data, and in the aftermath of news reports that indicate Ben Bernanke will be reappointed to another term as Chairman of the Federal Reserve. It appears President Obama’s advisors decided to heed Wall Street warnings and maintain continuity.

Silver is 2 cents higher at $14.22. Gold is $947.00 up $5.00. Palladium edged up $3.00 to $285.00. Platinum down $2.00 and is presently trading at $1238.00. Our background barometers are mixed and quiet with Crude slipping 17 cents to $74.20. The Euro is 28/100ths of U.S cent higher at $1.4328.

U.S . stocks ended the Monday trading day flat with a marginal gain of 3 Dow points. We still have no clue as to why the market collapsed so rapidly yesterday. This morning the early futures indications are calling for a rise of 17 points. The indication is moot given the fact that the economic data will hit the wires long before the market opens.

As for the data; we expect to see improvement in both reports. The Case Shiller Home Price Index is estimated to clock in with home prices declining 16.4% compared to last month’s decline of 17.06%. Consumer Confidence for August is also expected to show improvement with an index of 47.9 versus July’s 46.6. Consumer Confidence is very important to the economy because it remains the key factor driving consumer spending. Spending drives our economy.

Oil Hangs On to Last Week’s Gains

Both of our day to day barometers are a shade higher with Oil hanging on to last week’s gain of $4.29 per barrel. Crude is presently up 18 cents at $74.07.  In the currencies the Euro is 11/00ths of U.S cent higher in a vacuum of fresh economic data. Last on the Euro $1.4328.

Metals are beginning the new trading week with Silver leading the way. Silver is 15 cents higher as traders lean towards an implied rise in industrial demand given last Friday’s optimistic outlook by Ben Bernanke. Last trade $14.35. Gold is down $1.00 at $953.00. Palladium is $286.00 up $4.00. Platinum slipped $22.00 to $1236.00.

In the stock markets; Both Asian and European markets closed or are trading solidly higher. On the domestic side the Dow ended the whole of last week with a gain of 184 points, and appears to be headed for a 36 points rise this morning.

On the geo-political front President Ahmadinejad is facing sharp criticism of his new cabinet nominees both at home and abroad as Iran’s internal turmoil deepens. On the other hand North Korea continues to show warming gestures to the west with the current meeting between the Koreas being extending from it’s scheduled length.

In a final note; Scotland is attempting to control the political damage from its decision to release the Libyan agent convicted of the Pan Am Lockerbie bombing. And Cash for Clunkers ends today.

Today’s economic calendar:

Canadian Retail Sales

Tomorrow’s economic calendar:

U.S. S&P/Case-Shiller House Price Index
U.S. Consumer Confidence

Jittery Trading Following Overnight Stock Market Sell-off in China

Markets are trading in a jittery fashion following an overnight stock market sell-off in China. Since China’s economy and financial markets are so inter-linked with ours; it stands to reason that our markets will react in similar fashion to theirs.

Yesterday the Dow ended the day with an 82 point gain but looks to open 67 points lower in empathy with China. Over in the metals market we find the complex trading lower despite only mixed background signals from Oil and the Euro. Crude is 27 cents per barrel lower in advance of today’s Oil Inventory report. While we do not have the actual estimates at this time; we are told that Oil is expected to show a build in supply but Gasoline a decline.Last trade $68.92.

Given today’s idle economic calendar we find the Euro trading quietly and up 8/100ths of U.S cent higher at $1.4126. As for the metals; Silver is trading 43 cents lower at $13.57. Traders are pointing to a China induced sell off in Copper for the weakness in Silver. Remember Silver is often mined as a by-product of Copper. Gold is $4.00 lower and changing hands at $934.00. Palladium is $272.00 down $3.00. Platinum is down $21.00 at $1211.00.

While the stock market tries to digest the future of our economy; investment guru Warren Buffet had some positive comments. He stated his belief that “the U.S. economy is out of the emergency room and is on a slow road to recovery.”

In other matters of interest Hurricane Bill has been upgraded to a powerful category 4 storm packing winds of 135 mph. The storm is expected to turn north bypassing the east coast of the United States.

Thursday’s economic calendar:

U.S. Initial Claims
U.S. Philadelphia Fed Survey
U.S. Leading indicators
German Producer Prices

Fed Paints a Happy Face on US Economy

Yesterday the Fed gave the impression that economic activity is leveling out after it’s sharp and prolonged slide. Adding to the positive trading environment are reports out of Europe indicating the Eurozone economy is improving as well. It was reported that Germany and France are officially out of recession. As a result the metals rallied, the Euro climbed, and Oil surged.

The Euro jumped a little over a half cent against the Dollar with the last trade $1.4274. Crude Oil spiked on a presumed jump in future demand. Last trade on Oil $71.72 up $1.56 per barrel.

Over in Europe we find Silver up 23 cents at $14.75. Gold gained $4.00 to $954.00. Palladium jumped $9.00 to $282.00. Platinum is $1252 up $10.00 per ounce.

The Dow finished the Wednesday session up 120 points and appears to be headed for another 103 point rise this morning. The higher indications may temper somewhat as we approach the open.

We have two pieces of fresh economic data for traders to consider before the stock market opens. The Initial Weekly Jobless Claims are expected to show a slight improvement over last week with the latest estimate calling for 545,000 first time unemployment claims versus last week’s 550,000. Next comes Retail Sales for July where the picture is less bullish.

Wall Street expects to see a .7% rise is spending compared to June’s rise of .6%. That’s the good news. If however you strip out the impact of auto sales (Remember Cash for Clunkers is a temporary government subsidized bail out program) the rise in overall retail spending is up a mere .1% versus June’s rise of .3%.

Today’s economic calendar:

U.S. Initial Claims
U.S. Retail Sales
U.S. Import Prices
U.S. Business Inventories

Friday’s economic calendar:

U.S. Consumer Prices
U.S. Industrial Production
U.S. Consumer Sentiment
EZ Consumer Prices
EZ GDP
German GDP

Here’s an insightful video on why the cash for clunkers program hurts most those it was intended to help:

Late Afternoon Pre-Fed bounce in the Euro

With about a half hour to go before the Fed releases it’s data; the metals ended the New York session on a firm note.

The Euro gained 62/100ths of cent versus our Greenback with currency traders front running their expectations of what the Fed will say. The Euro got a little extra support when the U.S.Trade Deficit expanded by $1 billion from the prior month.

Traders took their cue from a surge in Oil and a late afternoon pre-Fed bounce in the Euro. Silver ended the session at $14.56 up 22 cents. Gold gained $4.00 to $950.00. Palladium and Platinum remained slightly down,losing $7.00 per ounce for a close of $1235.00 and $2.00 for Palladium and a close of $273.00. Volume was moderate.

Crude Oil jumped by $1.24 per barrel on the Dollar’s weakness along with a powerful surge in the Dow. The rise in Oil comes despite today’s higher than expected inventories. Last on Crude $70.69.

In the stock market the Dow is presently up 134 points with traders pointing to the warm reception on today’s treasury debt auctions. Other traders are buying in advance of expected optimism on the part of the Fed. More in the AM

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