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Current Futures: Dow -18.00, S&P -2.70, NASDAQ -3.50
Asian markets are currently trading side-ways, lacking a clear direction after the major U.S. indexes closed barely above the breakeven line earlier, mainly helped by a surge seen during the late cash session. After two weeks of strong gains, investors appear once again cautious, as it seems that the stock market has left behind the fundamental value of most shares, TheLFB-Forex.com Trade Team said. Moreover, a retracement may be expected after two weeks of continuous gains, as the market follows the well-known wave structure.
The Asian market followed the same pattern tonight as the day before. The financial sector continued its uptrend during the Asian session, something that was very well seen over the last few trading sessions. For example, during the U.S. cash session, the financial sector was the only one to advance most of the time out of the 10 industries represented in the U.S. market. However, the industrial sectors continue to be the worst performing in the Nikkei index, since orders for industrial machineries lag behind due to the output gap seen in the economy, which is also known as an economic slack.
In other news, Treasury Secretary Timothy Geithner said that the U.S. economy is seeking ways to reduce the huge deficit the government faces. However, this will probably happen slowly over the next few years, TheLFB-Forex.com Trade Team said. These statements came after the U.S.’s largest bondholders complained about the value of the dollar and its outlook, due to the huge U.S. deficit. In addition, the Treasury stopped complaining about the weakness of the Chinese yuan, which was a major issue until recently. In time, this will hopefully lead to an improvement of the Chinese-U.S. relationships, since this is very important because China is the largest U.S. bondholder in the world, TheLFB-Forex.com Trade Team added.
Overnight, the Japanese Nikkei fell 25.78 points (0.26%) to 10,062.88. The Australian S&P/Asx advanced 7.80 points (0.19%) to 4,147.40
Crude oil for August delivery was recently trading at $68.00 per barrel, higher by $0.10.
Gold for August delivery was recently trading higher by $0.20 to $956.80.
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