Trader Talk

Dollar Trade Holds as Index Sits at 8-Month Low


Bob Pisani is off; this post was written by CNBC producer Robert Hum.

S&Pfutures were fairly flat Wednesday and pointed to a slightly lower open as European stocks are around the unchanged line in midday trading. But one thing has been quite evident, the dollar trade continues to hold. Stocks continue to move inversely to the dollar’s intraday movements — a correlation traders observed all day yesterday, too.

As the dollar came off its lows after 8:30am ET this morning, futures fell off from their highs.

Speaking of the dollar, the Dollar Index (.DXY) sits at an 8-month low as stocks sit at 4-month highs.

Commodities continue to edge higher, with gold remaining above $1,300 an ounce at record highs, silver hovering at 30-year highs, and copper right near a 2-year high.

Meanwhile, ahead of a 7-year note sale today, but with no economic data scheduled for this morning, Treasury yields are lurking right at record lows.


1) Family Dollar rises 5 percent after beating Q4 estimates ($0.56 vs. $0.51 consensus). Traffic improved as same-store sales rose 6.1 percent.

Looking ahead, the discounter sees earnings of $0.55-$0.60 inline with $0.57 consensus in the current quarter with comps growing 5 percent to 7 percent. Guidance for the full-year is quite strong however — earnings are seen between $2.95-$3.15 vs. $2.96 consensus on comps of 5 percent to 7 percent.

2) Hewlett-Packard rises 1 percent after the tech firm forecasted 2011 earnings and sales to be above Street expectations. Earnings for next year are seen between $5.05-$5.15 vs. $4.99 consensus, while revenues are expected between $131.5 billion-$133.5 billion vs. $131.4 billion consensus.

3) GNC, the health food/vitamin retailer filed for a $350 million IPO. It’s the 3rd time the company has attempted to go public after being acquired by private equity Apollo Management. It had previously filed for an IPO in 2004 and 2006. Goldman Sachs and JPMorgan are the lead underwriters for the offering.

4) The Mortgage Bankers Association reported a 0.8 percent decline in mortgage applications in the latest week despite record low interest rates. The 30-year fixed mortgage rate fell to 4.38 percent (down from 4.44 percent) to a record low. Refinancing applications fell 1.6 percent, but that decline was slightly offset by a 2.4 percent rise in applications to purchase homes.

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