Mirror Image Trading Day

[Excerpted from Bill Cara's Daily Report]

Tuesday was the mirror image of Monday. Monday popped higher at the open and then sidetracked all day, while Tuesday plunged at the open and then sidetracked all day. Unless you can see the order flow, or know in advance the tone of the economic data to be published, it makes for a challenging trading day.

At the close Tuesday, the S&P 500 (919.32 -7.91 -0.85%), the DJIA (8,447.00 -82.38 -0.97%), and the NASDAQ (1,835.04 -9.02 -0.49%) were all weaker.

The Toronto Composite (10,374.91 -101.86 -0.97%) and the Toronto Venture Board (1,091.97 -13.59 -1.23%) were also weak on the post Canada Day holiday, ending a string of four winning sessions.

Earlier Wednesdsay, Austral-Asian markets were mixed. China (3,008.2 +1.65%) and India (14,645.5 +1.05%) were very strong on good economic data from China whereas Japan’s Nikkei 225 (9,939.9 -0.19%), and Aussie All Ordinaries (3,872.3 -1.91%) were losers. The Hong Kong market was closed. Commodity prices were higher and that led to much higher share prices in Europe.

As for the European equity bourses, prices were robust at mid day. The French CAC (3,194.1 8:08AM ET +1.71%), German DAX (4,881.9 7:54AM ET +1.52%) and UK FTSE 100 (4,305.1 7:54AM ET +1.31%) were all advancing.

In US trading on the Tuesday, no sectors were higher and only REITs ($DJR +0.6%) was notable among industry groups on the upside. All sectors were down close to -0.9% although the Goldminers ($XAU -3.2%) dropped the most.

The winners among Cara 100s were Electronic Arts and First Solar (ERTS +4.4% FSLR +3.2%), while the losers were by Tata Motors, Starbux, and ICICI Bank (TTM -9.4% SBUX -5.1% IBN -4.2%). TTM had been down -3.5% the previous day as well.

The trade-weighted $USD index was stronger (80.17 +0.31 +0.39%), likely as a result of the Interventionist Fed arresting the growing strength in oil, especially, and precious metals. The Euro (140.35 -0.44 -0.31%), Pound (164.65 -0.93 -0.56%), Yen (103.75 -0.36 -0.35%) and Cdn Loonie (86.01 -0.41 -0.47%) were all soft against the US Dollar.

In quiet bond market trading, the US long Bond was a bit soft ($USB 118.36 -0.20 -0.17%). The yields for 30-year (4.311 +0.04 +0.09%), 10-year (3.523 +0.31 +0.89%), and 5-year (2.558 +0.30 +1.19%) were a tad stronger. Treasury bill yields gained (0.180 +0.20 +12.50%).

After several days of gains, until a small pull-back on Monday, $GOLD pulled back sharply (926.60 -11.20 -1.19%). Crude Oil however was relatively much weaker (69.89 -1.60 -2.24%).

Spot gold, palladium, platinum and silver, however, are in recovery mode this morning: (937.32 +8.47 +0.91% 08:28am ET); (247.0 -1.0 -0.40% 08:26am ET); (1181.5 +9.5 +0.81% 08:26am ET); and (13.6800 +0.0325 +0.24% 08:27am ET), respectively.