Daily Market Analysis – SNB Takes Hawkish Tone

Equities:
Equities continue to earn back their gains that they lost over the last six weeks. In Japan, the Nikkei 225 closed down 67.75 point to 9,999.40 while European markets edged higher. The FTSE 100 added 15.97 points to close at 5,253.89 and the Stoxx 50 gained 7.79pts to close within 31.06pts of the 2,500 level. In the U.S, traders again were net buyers as the DJIA advanced 24.71 points to 10,434.17. The Technology sector lead the way Thursday with Vonage surprising to the upside by 12.61%. The ration of advancers to decliners was even.

Commodities & Treasuries:
Gold soared higher today after several quiet days. Gold gained $15.75 an ounce to close at a new all time high of 1,245. Oil unable to close above the 50 day moving average for a second day, fell to 76.58 after giving up nearly a $1.00 a barrel. Copper fell by $8.95 to 292.40 after making a wild run over the last two and half weeks. In the Bond market today, Spain was able to sell all of their bonds set for auction and thus easing concerns that it would run into potential financing difficulties. In the U.S, the benchmark Treasury 10-yr note yield slid more than 7bps ending a nice run. The 10-yr gained 20/32nds.

GOLD Rises

GOLD Rises


Currencies:
The CHF made a strong run at the Green back yesterday as it gained 1.70% to close at 1.1122. The EUR firmed as well to close at 1.2387, a .61% gain. The DXY fell back through the 86 handle to trade 85.66. The CAD retraced part of Wednesday’s advance to close at 1.0280. The JPY gained on the U.S Dollar for a fourth straight session, to close out the U.S session at 90.97

Economic Outlook:
The SNB left key interest rates unchanged yesterday at .25%. However, their hawkish tone set the stage for a CHF rally as it remained bid the entire day. In the U.S, CPI data reported in-line with expectations however, Initial Jobless Claims continue to rise while Continuing Jobless Claims  were down moderately.  Analysts attribute the weekly modestly lower Continuing Jobless Claims to unemployment benefits expiring among long term unemployed persons. It will be a quieter Friday as only a few releases will hit the wire. German Producer Prices will print and in Canada the Leading Indicators will be released.

- Alex Perlmuter

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