🚀 AI-picked stocks soar in May. PRFT is +55%—in just 16 days! Don’t miss June’s top picks.Unlock full list

Gold Rallies As Traders Lose Patience With Politics More Canada Earnings

Published 2017-02-24, 02:14 a/m
GBP/USD
-
USD/JPY
-
NDX
-
UK100
-
XAU/USD
-
DE40
-
GC
-
MGA
-
HSE
-

Stock markets around the world, but particularly in the U.S. have staged major rallies in recent wee‎ks. Gains were driven by speculation that President Trump would bring in sweeping pro-business change. Traders are starting to find out, however that the speed of government is a lot slower than the speed of business let alone the speed of markets.

Although some indices have managed to reach new all-time highs this week, the pace of gains has slowed suggesting markets may be getting priced for perfection, and it wouldn't take much to spark a correction.

Overnight action suggests that profit-taking may be getting underway. The NASDAQ turned down Thursday and this morning, U.S. index futures are trading down 0.3% to 0.5% while the FTSE is down 0.6% and the Dax is down 1.0%.

On Thursday, U.S. Treasury Secretary Mnuchin indicated he hopes to pass tax reform by the end of August but tjat this could slip to late in the year. Meanwhile, ‎other reports suggested Congress may not get to infrastructure funding until 2018. Action in indices and in sectors that have benefitted from "Trump trade" anticipation like industrials and construction could indicate if traders are getting tired of waiting. Next Tuesday, President Trump is scheduled to address a joint session of Congress. The street may be looking for something big and could be disappointed if he doesn't deliver.

Currency trading finds gold and JPY rallying overnight and building on Thursday's gains as ‎political risk concerns return for the U.S. and Europe. GBP continues to attract support with Cable holding above $1.2500. The Brexit cause got a big boost from a by-election that saw a big swing to the Conservatives enabling them to take a seat that Labour had held for about 80 years. Meanwhile, on the continent, France and Italy apparently have come out in support of taking a tough stance but as this early stage that is to be expected and both countries could have new leadership within six months anyway.

‎Canadian markets could attract attention today especially with U.S. news flow light. Consumer price inflation is due, one of the last major reports before next week's Bank of Canada meeting.

It's also another big day for Canada earnings. Royal Bank has picked up where CIBC left off beating the street by a wide margin and raising its dividend. ‎Husky Energy Inc. (TO:HSE) had a positive report while Magna International Inc (TO:MG) disappointed badly.

Latest comments

Loading next article…
Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.