Weak data in Europe has caused stocks to edge lower this morning while the US dollar surges. The market is anticipating second-tier retail sales figures, consumer confidence numbers, and housing data today. Investors are also looking for further clarification from Fed chairman Ben Bernanke.
90 minutes before the opening bell, Dow futures are down 27 points to 10,347 and S&P 500 futures are off 3.00 points to 1,104.50. Commodities are also broadly weaker with WTI Crude oil trading $1.54 lower to $78.77 per barrel and Spot Gold down $3.07 to $1,111.18.
Meantime, The US$ index is up 21 basis points to 80.71.
Economists from BMO point out that the German Ifo Survey for February unexpectedly dropped, initiating a sell-off. “Though the expectations component edged higher, the coldest winter in over a decade weighed on retail sales and construction causing the index to decline for the first time in 11 months,” they wrote. “Elsewhere in Europe, French consumer spending fell 2.7% in January, much worse than expected.”
Key Events Today:
9:00 ― The S&P Case-Shiller Home Price Index has been rising for sixth consecutive months as of November, most recently inching forward by 0.24%. Compared to one year ago, prices were down only 5.3% ― the slowest pace of price decline since September 2007. Economists hope that annual number narrows further in December.
The RPX house price index ― a leading indicator of house price trends ― suggest prices could be unchanged in December, note economists from Nomura Global Economics.
“We look for a flat monthly growth rate and a year-on-year decline of just 2.8%,” they wrote. “The fact that house prices have held their summer/autumn levels into winter months, when prices typically cool, is a strong sign that the market is on the mend.”
10:00 ― Consumer Confidence is expected to be broadly unchanged in February. The Conference Board’s index moved up slightly to 55.9 last month and in February expectations range from 52.0 to 57.0, a fairly narrow range.
10:00 ― The National Association of Realtors issues their quarterly Commercial Forecast
10:00 ―The Labor Department releases Mass Layoffs data
“The February pause in the stock market rally will reinforce consumers' cautious attitudes toward spending,” said economists from IHS Global Insight. “Looking ahead, a gradual improvement in the labor market will support income growth and sustain the recovery in consumer spending that began last summer.”
5:00 ― James Bullard, president of the St. Louis Fed, speaks on regulatory reform to the Chartered Financial Analysts Virginia Society in Richmond, Va.
Treasury Auctions:
- 11:30 ― 4-Week Bills
- 1:00 ― 2-Year Notes
