Data today showed the Conference Board’s index of U.S. consumer confidence increased to 81.5 in August from 81 the prior month. Growing tension over possible military action in Syria has put stress on the equity markets this morning. All 10 main S&P 500 groups retreated today.
Equities: The SEP13 E-mini S&P 500 (CME:ESU13) is trading down 18 points to 1636, and we have our next downside target at 1623. We have 1648 as a short term resistance level, and we would not be surprised to see this market try to break below 1600 soon, especially if crude oil keeps heading higher, which could be potentially viewed as a drag on the economy. The escalating potential of military action in Syria is likely causing investors to take some profits in the stock market accumulated this year off the table.
Bonds: The SEP13 US30yr bond futures (CBOT:ZBU13) have had a nice rally off of the recent lows right below 130, and are now up 21 ticks on the day to 132’20. We would not be surprised to see this market continue the rally at least one point high to the mid-high 133′s, especially possible if the stock market keeps going down. Our key line in the sand for the bond market is 131’15.
Currencies: The SEP13 USD (NYBOT:DXU13) is weak today, trading down 22.5 ticks to 81.215. The SEP13 Euro is trading up 20 ticks to 133.95. We believe the Euro is gaining overall bullish momentum as the economic data from that region come out stronger and stronger. We believe the Euro might breakout above the 1.34 level and possibly approach the recent high mark of around 134.50, just hit earlier this month. The SEP13 Japanese Yen is also strong today, trading up 148 ticks to 102.87.
Commodities: DEC13 gold (COMEX:GCZ13) is powering higher today, trading up $25 to $1,418. Gold is likely heading higher on an increased potential for military intervention in Syria. $1,395 to us was a key resistance/breakout level, and if gold keeps rallying, we look for a next upside target of $1,443. NOV13 soybeans (CBOT:SX13) are continuing their impressive rally this morning, trading up $.05 to $13.94, actually approaching the $14.10 level this morning before reversing lower. We are very curious to see how the soybeans market reacts to the first week of September when we might see some harvest selling. OCT13 WTI crude oil (NYMEX:CLU13) is up over $3 to $109, and we have our next market profile target at $111.30, which could potentially be hit very soon.