The US dollar remains mixed against most major currencies except the Japanese yen. Data from the University of Michigan Surveys of Consumers said sentiment rose to 73.5 in September from 65.7 in August. Data from the Commerce Department reported durable goods orders tumbled 2.4% in August, the largest decline since January. Durable goods orders provide a measure of overall business health and manufacturing activity. The Commerce Department also reported sales of newly built single-family homes rose 0.7% to a 429,000 annual pace, indicating a gradual recovery of the housing market.
The euro rose against the dollar after hitting an overnight low. The European Central Bank said private sector loans contracted for the second month and hit a record low of just 0.1% in August. Data from the national statistics office INSEE reported consumer sentiment index rose to -36 in September, confirming that the economy grew in the second quarter as French consumer morale hit a 19-month high.
The British pound continues to fall after Bank of England Governor Mervyn King's bearish comments yesterday. Perceptions that the UK currency will be allowed to weaken to help the fragile British economy pushed market players to dump the pound.
The Japanese yen rallied and rose to a 7-1/2 month high vs. the dollar after the G20 pledged to continue emergency stimulus spending, suggesting US interest rates may remain very low. The yen also got a boost after an influential former Japan finance official said that authorities were not likely to intervene on the recent yen gains against the dollar unless it went below 85 yen.
The Canadian dollar continues to lose steam against the US dollar as oil prices dropped to $66 a barrel and global equity markets weakened. In addition, the loonie took a hit after bad economic data was released from the US. Lately, the trend has been that bad economic data helps the US dollar but weakens other currencies as investor's flee from riskier assets.
The Australian and New Zealand dollars clawed back losses after a G20 draft that stimulus measures will remain, to foster economic growth until a strong recovery is seen. Overnight, the Aussie and the Kiwi weakened against the greenback due to a drop in oil prices.
10-Year Treasury Note Yield: 3.352%
Dow Jones Industrial Average: 9,694.44 - 13.00