The three major indexes closed mostly flat on the day, paring losses by the session’s end. Durable goods, or sales of long-lasting, big-ticket items like refrigerators and washing machines, fell 2.8% in February. The currency fell down when Fed policymakers announced and revised the interest rate increase to two from four.
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The hot streak extended after St. Louis Fed President James Bullard joined a chorus of officials in highlighting the chance of at least two rate hikes this year, with the first perhaps as soon as April. With another speaking engagement scheduled today the market anticipates further support for the greenback with hints towards a move as early as April. Traders are refocusing on the U.S. economy to evaluate whether incoming data can sustain a rebound in the currency. “The big story over the past couple months has been an absolute loss of confidence and then all of a sudden the return of that confidence”.
“If there was a massive rate hike and a jump in the dollar, it would be very hard for gold to move higher, but any rate increase will be gradual”.
Most exporters in the country finished down, with Nissan off 0.98%, Toyota down 1.56% and Honda falling 1.6%. There is now some speculation on April, as Mr Bullard adds to the relatively optimistic Fed rhetoric this week. “Shares fell in a re-pricing of interest rate risk”, said Michael McCarthy of CMC Markets in a report. “That’s what’s helping the dollar”.
Hong Kong – Asian shares dropped on Thursday, with energy stocks taking a hammering from a slide in oil prices while a stronger dollar piled pressure on commodity producers. The dollar was 0.4% higher against the Japanese yen at Yen112.87.
The dollar advanced 0.2 percent to 112.64 yen and was little changed at $1.1171 per euro. The sector is down about 18 percent over the past year.
Equities may be losing momentum after a five-week rally erased the worst start to a year ever. Devon Energy slid $2.43, or 8.7 per cent, to $25.58.
Bombings in Brussels that killed 31 people and injured more than 200 also hit tourism stocks, adding to jitters about economic growth already rippling through world markets. Nike Inc. dropped 3.8 percent after its annual forecast missed analysts’ estimates. Benchmark U.S. crude was down $1.01, or 2.5 per cent, to $38.78 a barrel in NY.
ENERGY: After a period of sustained gains, oil prices were headed lower again as concerns over excess supplies returned following the latest USA stockpiles data. “The culprits are not hard to find a rising USA dollar and weaker oil prices”.
The single currency was down at 1.1158 dollars, while sterling was at 1.4090 dollars. Natural gas declined 7 cents, or 3.7 percent, to close at $1.79 per 1,000 cubic feet.
The CBOE Vix volatility index – often described as Wall Street’s “fear gauge” – was up 6.4 per cent at 15.90, having ended the previous week at its lowest closing level since August. Can it continue trading higher?
The Dow Jones industrial average fell 36 points, or 0.2 percent, to 17,546 as of 11:16 a.m. Eastern Time. The nation sold 810 million euros of 30-year securities in an auction that failed to draw enough bids to meet its target. On the Nasdaq, 1,594 issues fell and 1,055 rose. Wells Fargo, JP Morgan Chase and Citigroup were among the biggest drags on the S&P 500 index Thursday.
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Chinese stocks rose in late trading amid a revival in margin lending.
