(As of 7:25 am PST)
US equities are lower to start
this holiday shortened week as investors waded through a busy economic data
calendar Tuesday. A report on durable goods orders sent stock futures lower
early this morning. The headline number showed US orders for durable goods
falling 0.5% in April, in line with expectations. However, orders for core
capital goods, a representation of business investment, climbed 1% marking the
second straight monthly gain. A report on new home sales showed sales rising
better than expected in April, bouncing back after March’s sharp decline.
Consumer confidence also showed a slight increase in May, enough however to
beat consensus estimates. The positive data all around this morning is putting
pressure on stocks which began to weaken Friday on a stronger-than-expected
inflation report. The positive economic data recently has been received as
negative news for stocks as investors remain worried about the Federal Reserve raising
interest rates as the economy improves. It seems like we’re back in the “good
news-bad news” trade for now, as the Fed’s first rate move remains data
dependent. In other news across the globe, Asian markets finished mixed while
European stocks are trending lower as investors continued to track developments
in the Greek bailout situation. Gold and oil prices are both down 1% this
morning, while interest rates are nudging higher. After a long weekend and a
low volume week last week, traders are back and Tuesday looks like it’s shaping
up to be a busy day.
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