Equity markets in the U.S. managed to hold onto gains Monday as the trading session progressed. Starting off on a weaker foot the major indexes were able to rebound and show some resilience on Wall Street. Citigroup released their quarterly earnings and they did beat expectations, today Goldman Sachs and Coca Cola are among many that will release reports. Retail Sales came in slightly better than expected as Core data showed an increase of 1.1% compared to the estimate of 0.6%. However, the Empire State Manufacturing Index reading fared worse with an outcome of minus -6.2 compared to the forecast of minus -4.5. Besides corporate earnings today from the States, a few rather interesting data sheets will be published including Core CPI, Industrial Production, and the TIC Long-Term Purchases report from the Treasury. On top of that will be the second debate between President Obama and his challenger Mitt Romney late in the day.
While the status quo held yesterday and the EUR showed some resiliency against the USD, Gold continued to be pressured downwards. The Single Currency traded in range effectively within its short-term boundaries. The precious metal however slide further and finds itself near 1739.00 USD as of this writing. Commodity prices like forex showed mixed results yesterday, Crude Oil highlighted this with a rather choppy session. Today the German ZEW Economic Sentiment reading will be brought forth and the estimate being looked for is minus -14.6 after last month’s minus -18.2 figure. The economic sentiment reading from Germany could prove significant with any surprises. The European crisis has certainly not vanished. The European leaders summit will be getting underway in two days time. And while investors continue to grasp on to what has become normal circumstances within a giant ‘confidence game’ there are several potential straws that could break the camel’s back – poor economic data from Germany, besides the staggering debt ratios that are well-known among certain E.U. nations.
Tonight’s debate between President Obama and Mitt Romney could prove not only worth a view, but vital to the outcome of the U.S. election. Recent polls have shown that Romney has begun to gain in key swing States that are a huge factor in the race for the Presidency. After what is widely accepted as a poor performance in the first debate President Obama will have many critical eyes examining his candor and substance tonight. Many analysts have already penciled in a Obama victory in November, if Romney continues to make strides and actually were able to pull out a come from behind victory in three weeks time it could turn investment perspectives on their head.
GDP numbers will come from China tomorrow and the results could prove significant. Investors have become somewhat accustomed to the rather lackluster global economic data that has been making its way through the turnstiles. Preparation is a key element of trading and market participants will continue to have full plates in front of them to inspect in what could become a rapidly changing landscape in the coming weeks.