-- Posted Tuesday, 30 September 2008 | Digg This Article | Source: GoldSeek.com

The Day Ahead: September 30, 2008

Market Movers:  

• The failure of the TARP on the floor of the House of Representatives has moved action towards overnight trading in Asia and early morning action in Europe. With the credit markets currently jammed up, volatility should be expected to shape the overnight action and the direction of US markets in early morning trading Tuesday.
• News flow will provide direction for the markets as Congress dithers over what action to take to stem the tide of the growing crisis. It does appear that the plan in its current form, or in another, will not be resubmitted to House until Thursday at the earliest. 
• Look for possible Treasury or Fed announcements during the pre-market hours. Traders have priced in a full fifty basis point cut in the federal funds rate. While we do not think it a likely event, overt concerns in the market regarding  the fragility of the financial system and the economic fallout of the credit panic, it cannot be completely discounted. 
• Lingering concern over the condition of the US banking system and growing concern of the status of the financial sector in Europe should be the major economic factors that drive pricing action during the day. 
• Macro data will see the July Case Schiller estimate of price action in the housing sector and the September Chicago PMI and Consumer Confidence reports.  ISCS same store sales estimate and the Redbook survey will provide information on the condition of the retail sector and the appetite for retail goods among the public. These data will be second order questions during the upcoming trading day.
• The US Treasury will conduct a four-week bill auction at 1:00 PM and settle a two year and five year note. 

Joseph Brusuelas
Merk Investments
Chief Economist/VP Global Strategy
555 Bryant St. #455
Palo Alto, CA 94301
650-323-4341 Ext 107
323-481-6720 (Cell)
650-745-7045 (Fax)
jb@merkinvestments.com

This report was prepared by Merk Investments LLC, and reflects the current opinion of the authors.  It is based upon sources and data believed to be accurate and reliable.  Opinions and forward-looking statements expressed are subject to change without notice.  This information does not constitute investment advise nor a solicitation or an offer to buy or sell any products or services. 
-- Posted Tuesday, 30 September 2008 | Digg This Article | Source: GoldSeek.com

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