The US Dollar was mixed in today’s trading session as it continued to trade sideways against the Euro and the Swiss Franc, and remains resilient against the Yen as it held onto Friday’s gains. Against its other counterparts, the US Dollar was not able to hold up as it retraced about half of its gain against the British Pound, and plunged against the Canadian dollar as the disappointing increase in the Challenger Job Cuts lowered growth speculation for the sluggish US economy.
Today’s economic release continues to reflect a worsening labor market for the US as the Challenger Job Cuts increase by 19.1 percent as firms began to trim down on costs. The huge increase added further evidence to the drop in Non-Farm Payrolls, and may lead to another fall in the ABC Consumer Confidence due out tomorrow. Amid the pessimistic buzz surrounding the labor force, Factory Orders were upbeat as it rose the most in five months to 2.3 percent. The increase provided support that US durable goods orders are able to fend off a slowdown in employment, and that business investments have not shown any signs of decline amid a weakening economy.
There was a major downturn in the securities market in as the DJIA fell 108.03 points with the S&P500 following with a 30.51 point decrease in today’s trading session. American Express Co. shares fell as UBS downgraded the security, and bank stocks were also sent under water as Merrill Lynch downgraded the value of Wells Fargo & Co. and Wachovia Corp. stocks. Google shares fell by 4 percent as they continue to bash on Microsoft’s lavish $44.5B proposal to buyout Yahoo Inc. which may put Google’s current position as the Internet leader in jeopardy, and suggested that Microsoft is attempting to gain a monopolistic dominance in the World Wide Web.
The decline in the securities market along with the release of more pessimistic economic releases for the US economy sent Treasury yields up and sent prices down. The 10-Year Treasury yield climbed to 3.64 percent today with the 2-Year yield climbing to 2.05 percent. For tomorrow, the ISM Non-Manufacturing release is expected to show the services sector still under pressure from the aftermath of the credit crisis, will keep a watchful eye on the Australian dollar as many economic releases such as retail sales, building approvals and the RBA’s rate decision will help to determine whether the AUD will hold on to its gains.