Weak economic data from the US triggered another decline in the stock market, as a result of which Nasdaq Composite, S & P 500 and DJIA dipped by 2%, 0.55% and 0%, respectively.
At the same time, oil underwent a strong upward rebound, which ended the long-standing bearish wave.
Clearly, the main reason for the abrupt fall (in the stock market) is the lower-than-expected orders for durable goods, which, according to reports, fell by 1%.
And today, new data on unemployment came out, which indicated that jobless claims have stabilized at 4.1 million for two weeks. This suggests that incentives from both the Fed and the US government failed to have a strong impact on economic growth or recovery.
Going back to oil, price grew by approximately 7% yesterday, completely winning back the losses it had the previous day. Apparently, demand has started to pick up amid support measures from major central banks. As long as this continues, there is no reason for another collapse in the oil market.
Forecasts:
Dow Jones - the DJIA is currently at 32.420. Analysts predict that it would range around 32.100 - 32.600 today.
US GDP - latest reports indicated that Q4 GDP is 4.1%.
WTI - oil should dip by 1.7% today, moderately correcting after the 7% increase yesterday.
USD - the dollar is currently trading at 60.20, but analysts believe that it would fluctuate around 59 - 61 today.
USD/CAD - loonie showed no gain yesterday despite a sharp rise in oil. Nevertheless, experts predict it to trade between 1.2500 - 1.2700 today.
USDX - The dollar index broke through 92.50 yesterday, showing the strength of the US dollar. Analysts forecast it to range around 92.00 - 93.00 today.