Stock indices were sharply lower on Tuesday as market fear and a poor technical outlook caused investors to sell stocks. Most US indices were sharply lower early in the session but recovered to close down by approx 0.5%. The trend does remain lower so a retest of the lows is probable. Interest rate sensitive sectors such as housings and autos and financials have been the worst sectors , while Utilities and Healthcare have been holding up well.
The US dollar index has made a new 8 week high as the EUR struggles with Italian budgetary concerns and the GBP weakened on the continued Brexit dispute between the EC and even the British cabinet. The stronger economy and higher relative bond yields should continue to push the USD higher in the next month.
US bond yields are at 3.15% for the 10yr , still in the 3.10-3.25% recent range as markets wait for more signals on a potential Fed rate rise in December even in the face of Trump tantrum. Debate still rages about if the Fed should pause the rate rise , but I think they will definitely raise in Dec and then maybe signal that they will wait early in 2019.
Crude oil prices have fallen sharply since the start of Oct primarily on concerns for the Chinese economy and the impact of falling demand along with the ample US stockpiles. Middle Eastern tensions remain but has not yet had any impact on prices.
Latest prices :
Dow Jones - 25264 up 67 / S&P500 2738 down 2 / Nasdaq100 7114 down 6
EUR 1.1403 down 67 / GBP 1.2916 down 66 / JPY 112.59 weaker by 14 / DXY 96.13 up 42.
WTI Crude Oil 67.08 up 65. / Spot Gold 1230 flat
Daily Chart - WTI Crude Oil futures - CLc1 - This market has found some support at the 200 day moving average around 66.60.