Daily Analysis – Commodities Under Pressure, Nasdaq Leads Equities Lower

Mar 18, 2010
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By, BinaryOptionStrategy.com

EquitiesAsian markets ended lower, as investors focused on Europe’s debt troubles and the recent weakness in commodities. The Nikkei fell .9%, the Kospi dropped .8%, and the ASX 200 sank 1.3%. China’s Shanghai Composite closed down .8% and the Hang Seng lost 1.4%.

European markets closed down as well, led lower by banks with exposure to Greek debt. The CAC40 fell .7%, while the DAX eased .2%. The FTSE managed to close flat following a late day rally in miners. The weekend arrest of IMF head Domonique Strauss-Kahn on sex charges is not expected to impact on the debt situation in Europe.

US markets fell unevenly, with the Nasdaq bearing the brunt of the losses, dropping 1.6%. The Dow closed down 47 point to 12548, and the S&P fell .6%


Nasdaq Sinks 1.6%
Amazon shares fell 5% and Ebay dropped 3.6% in a broad Nasdaq selloff.

NYSE Euronext tumbled 12.6% on new that Nasdaq and the ICE would withdraw their takeover bid due to regulatory issues.

Lowe’s fell 3.6% after reporting weak earnings, and JC Penney fell 3.2% even though it beat earnings expectations.

Treasuries and Commodities
US bonds rose as investors fled riskier assets. 10-year notes gained 6/32, yielding 3.15% and 30-year notes rose 17/32, yielding 4.28%. German bonds slumped, with 10-year notes down .33 and 30-year notes slumping .925.

Commodities ended mostly lower, as another wave of selling pressured the asset class. Crude oil fell 2.6% to 97.06 and gasoline futures tumbled 5% to 2.9215, while natural gas gained 1.5%.

Silver slumped 3.6% to 33.745, and gold ended fractionally lower at 1492.50.

Agricultural futures ended mostly higher, as cotton jumped 4.1% and corn gained 2.3%.

Currencies
The Swiss Franc rallied 1% to .8834, as the dollar fell against most global currencies. The Euro rose .4% to 1.4177 and the Pound inched up .1% to 1.6204. The Canadian Dollar fell .6% to .9738, its lowest level in 6 weeks. The Yen and Australian dollar both rose .2%.

Economic Outlook
The Empire State Manufacturing Index fell to 11.9, well below estimates of 20.7. The Housing Market Index remained at 16, less than the 17 analysts had expected.

Tuesday’s reports will include Housing Starts and Industrial Production. The IMF is expected to approve Portugal’s bailout on Tuesday.

Earnings are due from Home Depot, Wal-Mart, and Dell.