Investors Cautious Ahead of Fed and ECB Decisions

Investors Cautious Ahead of Fed and ECB Decisions

By Niall King - Sales Trader CMC Markets Sydney

The local share market has traded lower in the early part of today's session with a combination of profit taking and mixed economic data taking the gloss from yesterday's bank fuelled rally. The major US markets were higher again overnight in spite of the mixed data. US consumer confidence grew more than expected while Eurozone unemployment reached dreary record high's. While global fundamental economic signals remain confused, the bulls appear content to lay their hopes in central bank stimulus.

Locally, the miners have been the main drag on the market this morning following lower commodity prices overnight while the major banks have been unable to sustain yesterday's optimism.

The Aussie Dollar has sauntered higher over the past few days mostly on the back of equity market cheer and a weaker US dollar. This morning's weak local manufacturing data has done little to damage the Aussie while Chinese manufacturing figures came in as expected. Currently fetching $1.0375 despite increased expectations of RBA intervention next week, local unit's recent strength remains intact.

The next major economic checkpoints are almost upon us, with Fed and ECB meetings imminent and the market is expectant rather than hopeful. Investors will have their fingers close to the trigger in case either of these events disappoint and a spanner is thrown in the stimulus works.

ENDS

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