US equity markets were able to return near neutral levels despite stocks being sold heavily earlier in the session. The Dow was losing as much as 300 points from the highs of the day as European hardships remained front and center of investors’ minds however was able to pare losses to close 0.2 percent lower. However, European equity markets continued to suffer as traders pondered a potential return to recession despite stronger economic feedback from the Euro region. Euro-zone Industrial orders outstripped expectations to rise 5.2 percent against the expected 2.3 percent representing annual growth of 19.8 percent.
To currencies and the Aussie dollar was able to resurface after falling to lows of 80.65 US cents – At the time of writing the Aussie is buying 82.66 US cents. The Euro was also able to take a similar route which was able to regain composure after earlier in the session falling to 4 year lows against the greenback. At the time of writing the Euro is buying US$1.2340.
Economic news from the states saw consumer confidence data surpass expectation to record a rise to 63.3 against a previous 57.9. Analysts had expected confidence to grow to 58.8. US house price index rose 0.3 percent in March against the expected neutral result. The March S&P Case-Shiller house price index rose 2.35 percent in March against the expected rise of 2.5 percent.
Locally, this morning will see the release of the Westpac leading index, however the major barometer of local currency movements are likely to remain with equity market movements. Technically, we are still looking at a currency oversold with the RSI (Relative Strength index) showing the price around the ‘28’ levels. Technical analysts believe an RSI reading of ‘30’ or less suggests a reversal of price action is imminent.