US stocks have slipped today, with technicals in focus and scant key items on the US economic calendar, as the S&P 500 hit yet another intraday record in early trading.
By Paolo Palazzi-Xirinachs
Thursday, May 29, 2014
After hitting a high, the market looks to be taking a little bit of a breather, but the fundamentals of the US market still look strong – and this rally has been all about an adjusting to rosier expectations. At 12:00 PM in New York City the S&P 500 was little changed at 1,912.28. The US equity gauge earlier has fallen as much as 0.2 %. The Dow has retreated 21.65 points, or 0.1 %, to 16,653.85, while the Russell 2000 has slipped 0.4 %.
A report by the Commerce Department tomorrow might show the US economy contracted 0.5 % in the first quarter, following a preliminary estimate of 0.1 % annualized growth, according to economists surveyed by Bloomberg News. GDP rose at a 2.6 % annualized pace in the previous period. Economists forecast growth of 3.5 % during the second quarter. The markets will be strongly focusing on the GDP number tomorrow. There appear to be two camps of investors: those that believe that the economy is at a point where it reaches a self-sustaining path, and those that don’t. But the markets aren’t being driven as much by the tug and pull of these two camps as once would expect.
Low volatility and interest rates that are holding in tight ranges have resulted in an “abnormal” trading market according to Goldman Sachs President Gary Cohn. The Chicago Board Options Exchange Volatility Index climbed 0.4 % to 11.55 today. It is less than 3 points from a record low. “The environment for all the firms is quite difficult right now,” according to Cohn who spoke at an investor conference in New York, today. “What drives activity in our business is volatility. If markets never move or don’t move, our clients really don’t need to transact.”
This information has been prepared by Nadex, a trading name of North American Derivatives Exchange, Inc., prepared by independent third parties contracted by Nadex or reproduced form third party news agencies. In addition to the disclaimer below, the material on this page does not contain an offer of, or solicitation for, a transaction in any financial instrument. Nadex accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication.