PMI Data From Germany

Global equity markets achieved some gains on Monday, but one day of positive trading doesn’t equate into a full rally and there is still plenty of time this week for investors to make their nervous sentiment known. Speculation that the Federal Reserve will begin to propose a new stimulus package the end of this week was a common view on Wall Street yesterday, but it should be noted that any plan Fed Chairman Ben Bernanke comes up with will be met with a fierce amount of debate. Taking into consideration the lack of success from the first two quantitative easing policies, a large amount of skeptics particularly from the Republican side of the political aisle can be expected. The fact that Washington is nearly into full election campaign mode for the 2012 Presidential race will not enhance matters.

The EUR lost some ground to the USD on Monday and today Germany and France will release important PMI reports. The Manufacturing and Services readings will help give investors further insight into the prospects of a recession in Europe. The most recent German GDP numbers did nothing to help sentiment. The EUR has done remarkably well the past few months taking into consideration that not only is Sovereign Debt a genuine concern, but Europe's entire banking fundamentals are now coming under the microscope. Today's PMI numbers will be important and could cause some volatility for the Single Currency. The German numbers will be watched particularly close since Germany is regarding as the 'engine' of Europe.

Gold remained on a record pace Monday as it broke through the 1900.00 USD an ounce mark for the first time. Gold trading is fast and furious and its value has been directly brought about because of safe haven seekers, but there should be no doubt that speculators are enjoying themselves also and taking advantage of what has nearly been a one way trend. The precious metal will continue to find a variety of reasons to be volatile and it stands to reason that as long as huge questions persist about the health of the European Union's monetary structure and the U.S. is considering another round of quantitative easing that investors will have questions about the long term value of 'paper money'. The AUD gained on Monday and has inched upwards as equity markets have shown some ability to stabilize. The prospects of a global turndown have certainly affected the AUD and it remains an interesting trading opportunity as its range gets tested.

The U.S. will release New Home Sales today and no good news is expected from this data. The housing market in the States remains a vastly depressed entity and investors have likely buffered themselves for any surprises that could transpire. A good result would be of interest from the housing sector but is not widely anticipated. Tomorrow the U.S. will present Core Durable Goods Orders and these results will move the market. A poor number could be enough to send Wall Street into another tailspin, while a good outcome would give impetus to investors who believe equities are undervalued and a good buying opportunity.

While the Forex market remains range bound in many respects, the Commodity markets have been a fertile ground for courageous traders. Crude Oil found another round of fast trading on Monday and this is likely to remain a testing area for investors and speculators who displaying their outlooks on the health of the U.S. economy.

The GBP should be watched today. The Sterling has gained recently and is near the higher end of its short term trend. Today the CBI Industrial Order Expectations reading are on the schedule and if the number were to come in below its estimate of minus -12 it could set off some shockwaves for the GBP. The U.K. economy is doing no better than its counterparts. Yes the U.K. is practicing a tough austerity policy, but its growth numbers have been miniscule.

Monday proved a rather calm day of trading in comparison to the past couple of weeks, but traders should remain fully alert for all data and news making its way across the wire.