February 10, 2010
Stock Indices, gold and crude oil are trading relatively flat overnight. Yesterday’s strong buying has been met with uncertainty following the inability of the European Union to reach
a loan guarantee agreement with Greece.
Investors are taking a cautious approach ahead of an EU announcement. The longer the EU delays the announcement, the more nervous traders will become, thereby forcing weaker longs out
of the market. This could lead to general weakness today.
Today’s focus will be on appetite for risk. Simply stated, if the EU makes the announcement to guarantee Greece against sovereign default, then look for an increase in demand for risk
to send stocks, gold and crude oil soaring. Otherwise, expect these markets to drift sideways-to-lower.
Treasury futures are up slightly. This could be a sign that traders are hedging against a down move in risky assets.
All major currencies are down versus the U.S. Dollar overnight after the European Union failed to deliver a resolution to the Greece sovereign debt problem. Yesterday, currencies, led
by a rally in the Euro, …
