Indices and Commodities Under Pressure

Indices and Commodities Under Pressure
Thursday was a day of significant market activity. The Swiss GDP report exceeded expectations at 0.5%, while the US preliminary GDP figure came in at a solid 1.3%. However, the US pending home sales were disappointing, showing a drop of -7.7%. In the earnings spotlight, Costco delivered better-than-expected results, but its stock fell by 2% post-market, likely influenced by the broader negative sentiment.

As we head into Friday, the markets opened with a series of critical data releases. China's manufacturing PMI came in below 50, signaling contraction and adding to the concerns about global economic health. Conversely, the Eurozone provided some positive news with its inflation data: Core CPI was reported at 2.9%, and the CPI flash estimate came in at 2.6%, both beating expectations and boosting the Euro.

Later today, we anticipate further economic indicators, including Canada’s GDP, expected to show no growth at 0%, and the US Core PCE Price Index, forecasted at 0.3%. These figures will be closely watched as they provide further insights into the economic landscape and potential central bank actions.

The indices continue to show signs of a bearish correction. Despite some attempts to stabilize this morning, the overall sentiment remains negative in the mid-term. On the currency front, the Euro and commodity currencies like the Australian and Canadian dollars are showing strength, while the Japanese yen and Swiss franc are weaker, indicating a shift from safe havens to riskier assets.

Commodities are not faring well either. Oil has failed to maintain its bullish momentum, with the price dropping after a false breakout earlier in the week. Precious metals like gold and silver are also trending lower. The current market sentiment suggests that commodities will continue their bearish corrections in the coming days.


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