U.S. stocks spent almost the entire session on negative ground, but in the end the “bulls” managed to take advantage. The initial drop was caused by the global retreat, the advance of the dollar and the wider-than-estimated loss of UBS AG.
Fundamental news showed that factory orders for September increased 0.9%, which was better than the 0.8% increase that was widely expected. It also marked an improvement from August's 0.8% decrease, but it didn’t manage to influence upon the market sentiment.
Despite the strong dollar, the gold have reached new record high, after the International Monetary Fund sold 200 metric tones of gold to the Reserve Bank of India. Gold future contracts with delivery in December advanced by 2.5% to $1087 per troy ounce. Crude oil December futures also gained 2% to 79.74 per barrel.
On corporate level UBS exert pressure upon the financial sector, after it announced its third-quarter net loss was 564 million Swiss francs, beating the analyst average for 337 million francs loss. Switzerland’s largest bank closed the session 3.2% lower at $16.25 per share.
Meanwhile Intel dropped 2.7% to $18.50 per share, after Morgan Stanley lowered its rating on the semiconductor to “cautious”.
On the other hand Warren Buffett agreed to buy Burlington Northern Santa Fe Corp. фор $100 per share, which sent the railroad company 27.5% higher at $97.00. Banc of America and Citigroup gained 1.2% each to $14.80 and $4.04 respectively.
S&P 500 closed the session 0.24% higher at 1045, while Dow Jones Industrial Average dropped 0.18% to 9771. Nasdaq Composite also closed on positive ground, gaining 0.4% to 2057.
TECHNICAL OVERVIEW
S&P 500 – USA
The short-term picture is natural as S&P500 extended its trading around 1040. On the downside first target remains at 1040, followed by 1010, which is 38.2% Fibo retracement of the 1576-666 drop. On the upside, if 1100 is broken successfully next targets will be the resistances at 1120, which is 50% Fibo retracement of the mentioned drop, and 1160.
S&P 500 – USA (chart, table)
DAX 30 – Germany
The short-term picture is negative as DAX broke below 5400 which is 50% Fibo retracement of the 7229-3586 drop. Next target of the negative movement is 4980, with midterm support seen at 5260. On the opposite direction key resistance remain at 5850, followed by the psychological 6000 and 6250.
