Daily Analysis – Commodities Tumble, World Markets Drop

SamTrader1

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By, BinaryOptionStrategy.com

Equities

Japan announced that the level of the nuclear crisis was at level 7, the same level assigned to the Chernobyl disaster 25 years ago. The hews, coupled with a steep decline in oil prices caused Asian markets to sell off. The Nikkei fell 1.7%, and the Kospi dropped 1.6%. Australian shares fell 1.5%, as miners led the declines.

Similar losses were experienced in Europe. The FTSE and CAC40 both declined 1.5% and the Dax lost 1.4%.

US markets posted narrower losses, as the Dow fell 1% to 12264 and the S&P 500 dropped .8%.

Alcoa’s earnings report disappointed investors, as revenues were lower than expected, even as profits beat estimates. Alcoa shares fell 6%
apr-13-alcoa-tumbles.png

Alcoa Sinks 6% after Missing on Revenues

Goldman Sachs advised investors to lock in commodity profits, noting that oil in particular seemed to be overextended. The report contributed to the commodity selloff and weighed on materials stocks across the globe.

Oil fell more than $3 for a second day in a row. The drop pushed airlines sharply higher as Delta jumped 5% and Continental rallied 5.8%. Conversely, oil companies fell as Anadarko Petroleum sank 4.5% and Chesapeke Energy dropped 4.2%

Treasuries and Commodities

Bonds rallied as investor fear triggered a flight to safety. 10-year notes rose 24/32 to yield 3.49% and 30-year notes jumped 1 10/32 to yield 4.57%. The Treasury will auction 10-year notes on Wednesday.

All major commodities dropped in a widespread selloff. US crude oil fell 3.7% to 105.9, down 4.02. Gasoline futures declined 1.3% to 3.1601, while natural gas was largely spared from the selloff, easing just .2%.

Gold fell 1.1% to 1452.10 and Silver dropped 1.6% to 39.975. Copper declined 1.8% to 4.3785.

Agricultural futures posted steep declines, as wheat fell 4.9$ and corn dropped 3%.

Currencies

Despite the selloff, the dollar ended mixed. Investors have increasingly poured into the yen and Swiss Franc for safety, contributing to the dollar’s demise. The Swiss Franc jand Japanese Yen both jumped 1.1%, while the Euro rose .3% to 1.4478.

The Australian dollar eased .3% to 1.0456, after falling as low as 1.0390 earlier in the day.

Economic Outlook

Import prices rose 2.7% in March, more than the 2.1% analysts had expected. The trade deficit fell to $45.8 billion from $47 billion, but was still larger than expected.

Wednesday’s reports will include Retail Sales, Business Inventories, weekly mortgage applications, and the Beige Book.

Earnings are due from JP Morgan before the market opens.
 
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