Initial Claims Expected to Show Marginal Improvement

Our day to day barometers are trading a shade lower in quiet trading. Euro traders are playing close to the vest in light of of the current economic data estimates. Last on the Euro $1.4216 down 27/100ths of cent against our Dollar.

Crude Oil is also changing hands in quiet fashion after yesterday’s stunning $3.23 surge in price. The last thing oil traders expected to see yesterday was an 8.4 million barrel decline in Crude supplies. Last on Oil $72.23 off 19 cents per barrel.

The metals complex inched higher in listless overnight trading with many participants choosing to stand aside until the release of today’s U.S economic data. Silver is up 7 cents at $13.97. Gold is unchanged at $943.00. Palladium is $278.00 up $3.00. Platinum is $4.00 lower and trading at $1238.00.

Initial Claims are expected to show marginal improvement with 550,000 first time claims for unemployment versus last week’s 558,000. Leading Economic Indicators which projects the expected rate of economic growth 6 months in the future are estimated to clock in +.7%, same as last month. The Philadelphia Fed index of Manufacturing is expected show a reading of -2 compared to the prior reading of -7.5.

In the stock market the Dow finished Wednesday with a 61 point rise in the aftermath of lower Oil supplies and despite worries about China’s economic condition. This morning the Dow is being called to open 16 points higher. On the domestic front contentious health care reform continues to be front page news nationwide.

Friday’s economic calendar:

U.S. Existing Home Sales
Canadian Consumer Prices

Plunge in the Weekly Oil Supplies Sent Crude Soaring

The metals reversed course after an unexpected plunge in the Weekly Oil Supplies sent Crude soaring by $2.56 per barrel lifting the metals in the process. This week’s Oil Inventories clocked in with a decline of 8.4 million barrels. Needless to say traders scrambled to cover their short positions and go long the entire energy complex. Last on Crude $71.75.

The surge in Oil put pressure on the Dollar as well. The Euro is currently up 1.25 cents against our Greenback at $1.4243.

Stocks led by the energy sector bounced from an 80 point Dow loss to an 83 point rise on the day. Traders rationalize the drop in Oil supplies as meaning greater demand. Greater demand implies a stronger economy. Maybe!

As for our metals; Silver ended with a loss of 15 cents at $13.85. Gold erased it’s losses ending the day $3.00 higher at $941.00. Palladium finished the day unchanged at $275.00. Platinum down $2.00 to close at $1230.00. Volume was moderately active.

Traders will now ponder tonight’s Asian open hoping to see the some stabilization in the their markets. As for tomorrow the economic calendar resumes with the Weekly Initial Jobless Claims, Leading Economic indicators, and the Philadelphia Fed Index of Manufacturing. At a glance the early estimates are calling for flat to slightly improving numbers.

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

Today’s Housing Data Below Street Expectations

The dollar is still the premier world currency, and the gold market’s near-term direction could depend on its interactions with the currency market and the overall economic sentiment. The Euro edged higher after today’s housing data clocked in below Street expectations, and inflation continued to be non-existent. Last on the Euro $1.4118 up 36/100ths of a U.S cent.

Gold bounced on Tuesday, following the previous session’s sell-off on doubts about economic recovery, and the strength of the dollar could set the tone for bullion in the near term. Crude jumped $2.02 per barrel reflecting today’s bounce in stocks. Gold rose amid a mixed bag of news as the dollar weakened and the U.S. producer price index fell more than expected in July. Last trade on oil $68.77.

As for the metals; Silver finished the day off 7 cents at $13.95. Gold rose $4.00 to $938.00. Palladium gained $3.00 to close at $275.00. Platinum was $1.00 higher finishing at $1224.00. Volume was light.

Over in the stock market the Dow is currently up 73 points with banking stocks leading the way. As for tomorrow; the economic calendar will be idle, but we will get the latest Weekly Oil Inventories to help stir the energy trading pot.

Thursday’s economic calendar:

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

Sharply Lower U.S Stock Market Open Expected

Apparently Asia was also disappointed by last Friday’s poor U.S. consumer sentiment report with Far East stock averages sustaining sharp losses. China didn’t help matters when it indicated that it’s recent step-up in commodities stockpiling was slowing. This is raising fresh concerns as to the sustainability of an economic global recovery. As a result; the large overseas stock declines are front running an expected sharply lower U.S stock market open.

The Dow which lost a sum total of 48 points last week is indicating a 180 point lower open this morning. Confirmation of the weaker open is being felt in both the Euro and Oil. Crude dropped another $1.76 per barrel adding to last week’s loss of $3.42. Last on Oil $65.75.

In forex currency trading, the Euro is 1.24 U.S cents lower against the Dollar at $1.4061. The metals are broadly lower as well. Silver is off 60 cents at $14.09. Gold is down $11.00 at $936.00. Palladium eased $1.00 to $274.00. Platinum is $1229.00 down $28.00 per ounce.

Traders in all markets are now nervously awaiting this week’s slate of economic data desperately hoping to see some positive economic signals. Traders need a reason to start buying again. Unfortunately today’s calendar is thin with only the New York Empire State Index of Manufacturing for traders to hang on to. The latest estimate calls for the August index to rise into positive territory. Look for a reading of 2.2 versus last month’s contraction on .55.

On the domestic front it seems the White House may now be willing to drop it’s divisive plan for a direct government run health care system. While President Obama continues to defend his plan; he is now leaving the door open to alternative approaches succumbing to public outcries over the matter.

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