While only a small sample of the last Monday emerging market equities are outperforming the SPX despite the bloodletting in commodities. Today Copper (JJC, quote) is -4% and we are seeing industrial metals tank but EM equities are holding serve.
Yeah we know that commodities are suffering with a Strong U.S. Dollar, no China bid, oversupply… Tell me what I don’t know.
The highly anticipated Federal Reserve meeting and statement release later this afternoon has market participants on pause with gold (GLD, quote), silver (SLV, quote) and copper (JJC, quote) futures basically flat ahead of the U.S open.
So much for China (FXI, quote) leading a plunge in copper (JJC, quote) prices as inventories tied to collateral for loans were being dumped. Industrial growth globally is near multi-year highs across Europe US and much of Asia.
A lot of macro data around the world last night into the early morning and while European data missed the mark, China delivered. China continues to deliver and the implications are positive for the commodity space. Meanwhile, the Fed may be asleep at the switch when it comes to inflationary pressures.
Then why even after a 20% move lower today is it still trading like its offering Emerging Markets style growth?
China released PMI data last night for April’s manufacturing that came in at 50.4 which was better than March and slightly higher for the third straight month, but weaker than the 50.5 estimate economists expected.
Copper prices continue their climb higher this morning to an eight week high. Copper, sometimes referred to as Dr. Copper, is considered a benchmark by many as a barometer on the health of the global economy.
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