The rebound in crude oil and precious metals that started yesterday afternoon has continued through overnight sessions. There hasn’t really been much news to drive this so it may be a combination of short covering and bargain hunting. We could see some action in energy markets later this morning with crude oil and gasoline inventories scheduled. None of the oil or metal contracts have been able to break through new lower resistance levels though, so trading may remain choppy through the rest of the week. Stocks and currencies, meanwhile continue to reflect end of quarter consolidation and repositioning by traders as they take profits in some markets and prepare for next week’s flurry of economic data including PMI and US employment. Uncertainty over US budget negotiations and QE tapering have been getting some of the blame for the malaise as well although these factors seem to be doing more to keep some on the sidelines than actually driving action within markets. FX markets remain active. GBP has resumed its uptrend as stronger than expected CBI sales provide more evidence of a strengthening UK economy. JPY also remains well supported heading into Friday’s inflation data and Monday’s basket of key indicators. Resource currencies remain under pressure, particularly NOK and SEK. The correction in NZD continues after NZ exports fell short of expectations. Economic News Significant economic announcements released yesterday afternoon and overnight include: US durable goods orders 0.1% vs street (0.2%) UK CBI sales 34 vs street 23 NZ trade balance ($1.1B) vs street ($0.7B) NZ Exports $3.33B vs street $3.54B NZ imports $4.52B vs street $4.30B NZ YTD trade balance ($2.0B) vs street ($1.5B) Economic reports due later today include: 10:00 am EDT US new home sales street 420K 10:30 am EDT US crude oil inventories street (1.0 mmbbls) 10:30 am EDT US gasoline inventories street (0.75 mmbbls)

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