Summary
Equity markets were hammered as a combination of weaker than expected earnings and a disappointing consumer sentiment index, hurt investor sentiment. Bank of America's 8% drop led financials lower, erasing the S&P 500 index's weekly gains amid concerns the economy is expanding too slowly to spur corporate growth. Adding to the jitters was a morning report that showed consumer sentiment dropped to its worst level since March 2009. The S&P 500 lost 13 point or 1.3%.
Tomorrow's Events
EUR
8:00
EMU Current Account
May
-5.1B
USD
14:00
NAHB Housing Index
July
15
17
Trading Opportunities
USD/JPY
A combination of inflationary fears, poor earnings and risk aversion, pushed the dollar to an 86 handle the lowest weekly close in more than 2 years. CPI, according to the Labor Department slid 0.1% last month, dragged down by a decline in energy prices. In May, consumer prices were down an unrevised 0.2%. Core consumer prices, closely watched by the Federal Reserve, were up 0.2% as prices for apparel, medical care and cigarettes rose. The Thomson Reuters/University of Michigan preliminary index of consumer sentiment decreased to 66.5, estimates for the confidence measure ranged from 71 to 78.
Gold
Gold was hammered on Friday as investors pushed the yellow metal to the lowest level since mid-May. On a weekly chart, Gold still looks like it is solidly within an uptrend, and can fall to the 1150 level before long investors should become nervous. Gold has been hit by reinvestment back into European currencies, as fear has abated in this market and gold has suffered accordingly.