Global Economic Daily - 10/25/2024
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Quote of the Day: Out of difficulties grow miracles. – Jean de la Bruyere
Equities: Stocks were mixed but overall up on Thursday. The S&P 500 bounced back on Thursday, posting its first positive day in a week that has been beset by higher rates. The?S&P 500?added 12.44 points to 5,809.86 and snapped a three-day run of losses. The?Nasdaq 100?jumped 12.44 points and closed at 20,232.87. The?Dow Jones Industrial Average?lost 140.59 points to end at 42,374.36. The blue-chip index notched a four-day losing streak, its first since June. Roughly 160 S&P 500 companies have posted quarterly results so far, but their?earnings growth has been underwhelming. The blended growth rate, which tracks reports that have already come out and estimates for those set to report, indicates an overall S&P 500 earnings growth rate of 3.4% from the year-earlier period. That result came up short of analysts’ projections. Treasury yields moved lower, easing from three-month highs reached in the previous session. The 10-year Treasury yield topped the 4.25% threshold on Wednesday at the high of the session. Stocks are coming off a losing session, with the Dow suffering its biggest one-day drop since early December, falling more than 400 points on Wednesday. The S&P 500 shed nearly 1% and the Nasdaq lost 1.6%. TECHNICAL OUTLOOK – The Dow and S&P are still above the 14, 21 day moving average.
Metals: Gold prices are higher and silver prices are a bit lower in midday U.S. trading Thursday. Gold is benefitting from the bullish daily outside-market elements that include a weaker U.S. dollar index and a dip in U.S. Treasury yields. Safe-haven demand remains a major underlying supportive factor for the precious metals and is keeping a solid floor under gold and silver prices. t the BRICS summit in Kazan, Russia, Russian President Vladimir Putin introduced a new international payments framework aimed at reducing reliance on the U.S. dollar, which he accused of being used as a “weapon” by Western powers. The proposed system, known as “BRICS Bridge,” would utilize blockchain, tokens and digital currencies as an alternative to the SWIFT system. This initiative reflects a broader interest among non-Western countries to avoid potential exclusion from global financial systems dominated by the United States. Despite the ambitious proposal, practical implementation remains uncertain. The U.S. has warned that cooperating with Russia’s financial system could result in losing access to the dollar, complicating efforts to establish a sanctions-proof network. Meanwhile, Chinese President Xi Jinping said Beijing supports more global south countries joining the BRICS group as he called on the bloc to take the lead in reforming the global economic governance system. This “de-dollarization” is a bullish longer-term factor for the gold market. The key outside markets today see the U.S. dollar index lower. The benchmark 10-year U.S. Treasury note yield is presently fetching around 4.25%. Crude oil prices are weaker and trading around $70.00 a barrel. Technically, December gold bulls have the strong overall near-term technical advantage. Bulls’ next upside price objective is to produce a close above solid resistance at $2,800.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $2,650.00. December silver futures bulls have the solid overall near-term technical advantage. Prices are in an accelerating 2.5-month-old uptrend on the daily bar chart. Silver bulls' next upside price objective is closing prices above solid technical resistance at $37.50. The next downside price objective for the bears is closing prices below solid support at $32.00. TECHNICAL OUTLOOK – Gold and silver are back above the 14, 21 day moving average.
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