The markets witnessed a day of consolidation across the boards on Wednesday as investors took a pause to reflect on the gyrations from the past few days. The USD waffled against the major currencies as it displayed early strength versus the EUR and GBP, but gave back its gains as the day progressed. Wall Street turned in a flat affair with mixed results across the indexes. Building Permits data and Housing Starts both came in under their estimates in the States yesterday showing that the vital housing sector remains in tatters and only a shadow of itself during the height of the real estate bubble. Today the weekly Unemployment Claims numbers will be published along with the Philly Fed Manufacturing Index.
Also coming from the States today is the Initial Public Offering via General Motors which will trade as GM. Once the mightiest companies in the world, General Motors was reduced to rubble when the financial crisis hit two years ago. Today it gets a chance to start redeeming itself and this will create a healthy buzz on Wall Street. However, the IPO is unlikely to change overall sentiment that is being generated from an air of caution (confusion) from the Sovereign Debt concerns that are an ongoing story across the Atlantic and the debate that still pervades regarding the Federal Reserve’s monetary policy. There will be little in the way of economic releases from the U.S. tomorrow, thus sentiment is sure to come from the above and given the volatile nature of the market place, participants should expect any degree of consolidation to promptly turn into swift trading. Although the USD did not hold its gains on Wednesday, it didn’t veer off into losses either against most currencies.
Written by bforex.com