Tuesday, 06 November 2007 17:32:11 GMT
The US dollar continued to set record lows against the Euro and Canadian dollar, defying calls for a worthwhile correction on unflappable anti-greenback sentiment. Limited economic data on the day left currency traders to force movements off of broader speculative interest, and dollar-selling remained the dominant theme in broader currency markets. In fact, the downtrodden buck fell against all major foreign counterparts on a daily basis.
Euro bulls sent the single currency to yet another record, touching heights of $1.4569 before a marginal retracement through the
The lack of economic data did not stop traders from forcing strong price movements across major currency pairs, and pure market flows away from the greenback served as the only real justification for the move. One prominent bank claimed that the relative underperformance of US equity markets encouraged many clients to pursue risky asset classes in
US equity markets proved far more fortunate through NYSE price action, with the Dow Jones Industrial Average adding 50 points to 13,591. A surge in energy stocks pushed broader indices higher, and the S&P 500 added 0.5 percent to 1,510. Tech stocks were the smallest gainers through the session, however, with the NASDAQ Composite a mere 0.2 percent improved to the psychologically significant 2,800 mark.
US Government Treasury yields were slightly higher through the trading session, as the 10-year added 2 basis points to 4.35 percent. Yet shorter-dated yields remained relatively unchanged at recent 26-month lows of 3.67 percent. Speculators seem convinced that the Federal Reserve will continue to cut short-term interest rates through the medium term, and money market rates continue to decline through the period. In fact, Fed Funds Futures now show a 64 percent chance of an FOMC interest rate cut on its December 11 meeting.