Stocks are set to extend yesterday's gains and precious metals crashed, but a much-worse-than-expected GDP report could throw the markets off.
The government's final estimate for US GDP fell far short of estimates. The US economy grew by just 1.8% in the first quarter. Economists expected to see that the measure matched previous estimates of 2.4% growth.
After US stocks rose on an improving eoconomy, Dow
(INDEXDJX:.DJI) futures were up 0.48% at 14,761 this morning. Futures contracts on the S&P 500
(INDEXSP:.INX) gained 0.59% to 1,590.70 after hitting a nine-week low yesterday. Nasdaq
(INDEXNASDAQ:.IXIC) futures climbed 0.70% to 2,878.25.
Today is already a brutal one for precious metals. Spot gold hit a three-year low this morning. The price is down 3.75% at $1,229.76/ounce. Silver is trading for $18.64 on COMEX, down 4.66% today. The SPDR Gold Trust (ETF)
(NYSEARCA:GLD) fell 3.56% in the pre-market. One reason for this could be the much-better-than-expected economic data yesterday that sent up stocks, but worried some that an improving economy strengthens the Federal Reserve's case for tapering off stimulus. Today's GDP report might temper those fears.
Also today, Federal Reserve Presidents Jeffrey Lacker and Richard Fisher will both give speeches that investors could scrutinize for clues about the Fed's direction for the near term.
China's central bank further calmed markets, reiterating that it will inject cash into the system as needed "based on the market's actual situation." It is providing financing support to some institutions to stabilize interbank lending rates.
European equities are moderately higher and Asian shares were mixed. France's economy shrank by 0.2% in the first quarter, coming in line with previous counts. Germany's GfK consumer confidence survey rose to 0.3 points to 6.8, its highest level since 2007. Japan's Nikkei 225
(INDEXNIKKEI:.NI225) declined 1%.
Gold miners declined today on the falling price of gold. Barrick Gold Corporation (USA)
(NYSE:ABX) and Goldcorp Inc. (USA)
(NYSE:GG) fell 4% to$16.11 and $23.44 in pre-market trading, respectively.
No positions in stocks mentioned.
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