We are seeing a nice rebound in S&P 500 equity futures this morning, as investors appear set to buy into yesterday’s sell-off despite the remaining questions and concern still surrounding the Boston Marathon bombings. Numerous factors are helping increase sentiment prior to the open including: encouraging U.S. corporate earnings, very strong U.S. Housing Starts data and a rebound in Gold prices.
As of 8:50AM ET, we are trading approx. +1% higher in S&P futures while the front-month Gold contract has firmed up by approx. 2.5% to $1,395 an ounce.
However, it will be interesting to see if this early support for the equities can last throughout today’s trading session…
Main Factors Driving Early Trade:
– Strong Round of U.S. Corporate Earnings – On the corporate earnings front, better-than-expected results were seen from BlackRock, Goldman Sachs, Johnson & Johnson & Coca-Cola. Please be aware that after today’s close, investors are awaiting reports from Intel, Yahoo & railroad operator CSX.
– Encouraging Read on U.S. Housing Starts – Groundbreaking to build new U.S. homes rose in March to the highest level since 2008, adding to evidence of a healthier housing market. The Commerce Department said on Tuesday that starts at building sites for homes rose 7.0 percent last month to a 1,036,000-unit annual rate. That was higher than analysts’ expectations of a 930,000-unit rate. However, building permits, a proxy for future construction, fell.
– Rebound in Gold Prices – Gold prices are nicely higher today after posting their biggest one day fall yesterday. The sell-off was said to be driven by concerns about Cyprus being forced to sell its gold reserves and the impact this could have on other European countries. In addition, it was also rumored that a large hedge fund or foreign bank was forced to unwind a massive long position, which intensified the sell pressure across numerous financial markets yesterday.