Global markets are up slightly on very light volume, as traders try not to make any noise ahead of getting a glimpse of the rascally rabbit that is Fed monetary policy this week.
Gold trended slightly downward overnight after closing up 0.5% for the week on Friday, but got a bump at the COMEX opening. In contrast, palladium suffered a flash selloff to $716 at the opening bell, and has recovered slightly.
The Group of Eight industrialized nations are meeting in Belfast, Northern Ireland today, where Syria is likely to be a hot topic, but Mr. Bernanke wields far more power as far as the markets are concerned. The Fed Open Market committee begins its June meeting tomorrow, and Chairman Bernanke will conduct a press conference Wednesday afternoon to explain the conclusions of the committee.
The dollar is firming up, but not above Friday's range, as some safe haven demand leaks out of the yen. The euro still remains above 1.33 against the dollar. Oil continues to show strength, hitting a four month high overnight. The rupee in India continues to fall, which is suppressing gold demand in the world's largest gold importer. This is also traditionally a low-demand month for gold in Asia.
Overnight in Asia, the Nikkei index rose 2.7%, breaking the losing trend and getting out of bear territory. Hong Kong stocks finally see a good day, but Chinese stocks took a hit in energy and heavy pollution industries as Beijing announces measures to combat unlivable smog conditions in its major cities.
In Europe, composite Euro imports are reported to have jumped in April, and German wages in the first quarter rose at the highest rate in almost four years, giving stocks on the continent a boost.
In the U.S., the Empire State manufacturing index gained over nine points to 7.8 in June from May's surprise -1.4. Analysts had expected a small increase to zero. As CNBC notes, however, the numbers inside the numbers are cause for some concern, as new orders and worker hours fell. Wall St. still used the news to open higher. The National Association of Home Builders announced today that confidence among their member companies rose to the highest level in seven years this month, as restricted inventory of homes drives prices higher.
Precious metals are still trading in a tight range, which seems to now be the "new normal" until a major event breaks the "stickiness" of prices. Everyone waits to see what the Fed will say this week, while seemingly ignoring the closure of low-margin precious metals mines and contraction in the mining industry. The big question seems to be not what the Fed will say, but what the equities markets think it said.