US and European indices are trading lower again this morning as potential obstacles to further progress continue to mount. In the day after the S&P 500 and the NASDAQ 100 reached to within a few points of their respective 2,000 and 4,000 big number barriers, stocks have started to retrench on a combination of political, market and financial factors. Gains by indices over the last two weeks have been powered by a positive response to the latest round of corporate earnings. Now that many of the biggest names have reported and focus moves toward mid and small cap companies, the impact of earnings on indices may fade particularly as we move into August and September, historically the two weakest months of the year for stocks. meanwhile, may come under pressure today following a big miss. As the earnings halo effect fades, attention may fall back on some of the risk factors that have been roundly ignored in recent weeks but have not gone away, particularly in Europe. Yesterday, Portugal’s Espirito Santo Financial filed for bankruptcy while Ukraine’s Prime Minister resigned. Today traders have reacted negatively to disappointing Germany IFO survey results. Meanwhile, turmoil continues in Ukraine on reports of Russian artillery fire, threats of Russian sanctions against British companies, threats the US and Canada will try to block financing of Russian projects at the World Bank, and a Russian interest rate hike combine to suggest things are getting worse not better. Better than expected US durable goods orders have not had much of an impact on trading, a sign that the rally of recent weeks may be nearing exhaustion. Today finds traders taking money off the table from stocks ahead of the weekend, although we aren’t seeing a stampede back into defensive havens either. Gold has rebounded a bit but remains well short of its $1,300 breakdown point. Base metals like copper, aluminium and zinc plus the Hang Seng had another strong day as attitudes toward China’s economy continue to improve. Crude oil is holding steady. In currency markets today, NZD is under pressure again after soft business survey reports suggested the RBNZ could now potentially go on hold for a while after four consecutive rate increases. SEK is on the rebound in response to better than expected Swedish retail sales and trade figures. As we head into next week, focus may start to turn from corporate earnings back toward the US economy and monetary policy. It’s a huge week for economic news with particularly big days on Wednesday with ADP payrolls, Q2 GDP and a FOMC meeting, and Friday with nonfarm payrolls and manufacturing PMI. Corporate News Baidu $1.73 vs street $1.37 Visa $2.17 vs street $2.09 Starbucks $0.67 vs street $0.66 Amazon ($0.27) vs street ($0.16) Celestica $0.25 vs street $0.23 Economic News Economic reports released overnight and this morning include: In a surprise move, Russia’s central bank raised its benchmark interest rate to 8.00% from 7.50% blaming higher inflation risks US durable goods orders 0.7% vs street 0.5% US durables ex transport 0.8% vs street 0.5% UK GDP 3.1% as expected Germany IFO business climate 108.0 vs street 109.4 Germany IFO current 112.9 vs street 114.5 Germany IFO expectations 103.4 vs street 104.4 Sweden retail sales 3.3% vs street 3.2% Sweden trade balance SEK 5.2B vs street SEK 0.2B Japan consumer prices 3.6% vs street 3.5% NZ activity outlook 45.1 vs previous 45.8 NZ business confidence 39.7 vs previous 42.8 Singapore industrial production 0.4% vs street (0.9%) Economic reports due later today include: There are no major announcements scheduled for North America later today