daytrades oct 29 pre-market

Morning traders.

Market wrap: Stocks are likely to open modestly lower after a mixed night on Wall Street off-set a rebound in key commodities.

The December SPI futures contract closed 6 points or 0.13% weaker this morning at 4676. Wall Street was initially cheered by an unexpectedly large fall in weekly jobless claims and a slide in the U.S. dollar after news that the Federal Reserve is consulting bond dealers about plans for further quantitative easing. But profit-taking and a mixed bag of corporate profit results eroded gains by session's end.

The Dow swung from an early 50-point gain to a 70-point loss before closing 17 points or 0.15% weaker as 3M's earnings report disappointed. The S&P 500 added 0.1% and the Nasdaq 0.16%.

"There are too many uncertainties out there and that gets people worried," the co-chief investment officer at Oakbrook Investments in the U.S. told Bloomberg. "On the corporate earnings front, numbers have been good but it's time to get ready for the end of easy comparisons. The market has had a nice run and some investors decided to take some profits before we have more clarity."

Initial unemployment claims in the U.S. dropped by 21,000 to 434,000 last week, a level last seen in early July. The fall was well under economists' expectations for a seasonally-adjusted figure of 450,000.

Expectations for another round of quantitative easing in the U.S. increased after the Federal Reserve sought advice from the bond market over the size of bond purchases needed to stimulate the economy. The news reversed a slide in government bonds and sent the U.S. dollar down more than 1%.
The dollar index was recently off 1.1% at 77.31.

Most metals rallied as the weaker U.S. dollar made them more attractive to foreign buyers. Gold rallied around 1.5% to erase yesterday's fall and reach its highest level this week. Spot gold was recently $18.70 stronger than Wednesday's New York close at $1,343.70 an ounce. Silver for December delivery rallied 51 cents or 2.1% to $23.91 an ounce.

Copper continued to benefit from the threat of industrial action in Chile at the world's third-largest copper mine, but zinc eased from this week's nine-month high and lead also retreated. In late trade in London, copper was up 0.3%, aluminium 0.7%, nickel 1.1% and tin 0.4%. Zinc was off 0.6% and lead 1.9%.

Oil tracked sideways. Crude futures were recently off 1 cent at $81.94 a barrel.

Earlier, the major European markets bounced back from Wednesday's losses as local earnings reports mostly continued to surprise to the upside. Britain's FTSE added 0.56%, Germany's DAX 0.42% and France's CAC 0.5%.

TRADING THEMES TODAY

COMMODITY RALLY REVIVED: The U.S. dollar's brief attempt at a reversal from recent lows was quashed overnight as the market's hopes for rivers of free money streaming from next month's Federal Reserve meeting revived. That's broadly good news for resources, most of which rebounded nicely overnight. Futures traders appear to think we factored in any positive overnight news yesterday and given that it's Friday - often a day for profit-taking - they may well be right. I suspect world markets will come under pressure in the days ahead as the day of the Federal Reserve meeting nears and a "safety-first" mind-set kicks in, encouraging profit-taking.

ECONOMIC NEWS: Monthly private sector credit data is due at 11.30 am. Monthly new home sales are also due some time today. GDP tops the action tonight in the U.S. Also scheduled: regional manufacturing, revised consumer sentiment and revised inflation expectations, and the quarterly employment cost index.

Good luck to all.