Wall Street started the day rather flat. The three most important announcement for the day were cancelling each other.
Jobless claim fall and markets like to rally when jobless claims fall, because signals improving conditions in the labor market. And that was perhaps the early curve up at the market opening.
The morning rush was quickly vanished as gross domestic product (GDP) in the second quarter was revised down to 1.3% from an expected annual rate of 1.7%. Equity Markets prefer healthy GDP growth, other wise, markets will fall.
New factory orders for durable goods fell more than 13% . The news put pressure on the market. Durable goods orders are a good indication of industrial production and capital spending. The market will be concerned as the report highlight weak figures but bond traders will be smiling about it.
After mixed news from different fronts and without a proper direction, who better to direct the market lately than Europe. Indeed, Spain announced that it will go ahead with its latest package of austerity measure to please the conditions demanded by the European Bailout fund, like this, working to guaranty that Spain is sticking to the plan on exchange for a bailout.
The news has been welcomed by the Dow Jones and even the Eur/Usd pair has reacted well.
It will be interesting to see where will the market go from here as most economist has been predicting a pull back after many have been taking out of the market the profit from last month.
The Wall Street chart is certainly showing mix sign. Astute investor will step aside and look for a confirmation.