We believe these commodities are seen as attractive investments now not only because of their relatively low price compared to their prices last year, but also as a potential safe haven investment instead of shaky currencies around the world.
Equity index futures are slumping Friday as investors digest the impact of emergency rescue measures by emerging market central banks whose priority it is to alleviate pressures on domestic currencies.
Thanks to the Fed's tapering, a wider public is becoming aware of currency instability in diverse economies, from Turkey to Argentina, and India to Indonesia. Indeed, on Tuesday night Turkey raised overnight interest rates by a whopping 4.5% to 12% in an attempt to stop a run on the lira.
The oil market cheered GDP as it already was supported by old man winter. Led by heating oil and gas increases on refinery glitches and winter woes, WTI gained as the emerging market challenged the Brent crude contract.
Gold and silver tumbled the most in six weeks as signs of faster U.S. economic growth fueled bets that the Federal Reserve will keep cutting stimulus. Palladium capped the longest decline in almost five months.
The market has continued to consolidate higher this morning as it searches to test resistance at 1780-82.25. Yesterday's close was 1771.25, the market must hold this level and truly close above the pivot at 1775.75-1776.25 to keep sentiment positive.
The MAR14 E-mini S&P 500 is up 10.75 points to 1782, after recent corporate earnings reports, as well as an excellent reading on GDP, sparked investors to buy equities. 1775 is our key support level. Even with the second taper yesterday, the stocks are showing resilience, and climbing this morning.