Blame It On The Brits
Markets fixated on a reversal of fortunes, or at least a reversal of earnings forecasts, from the British telecom equipment maker Marconi. The company reversed a May forecast and said profits and sales would drop for the remainder of the year.
Stock indexes sold off on the latest round of bad news from the telecom sector as traders pondered what lies ahead for corporate profits worldwide. The news sent Nasdaq futures 90.00 lower to 1758.00 and S&P futures
(
SPU1 |
Quote |
Chart |
News |
PowerRating) down 1222.30 to 23.30.
Signs that the economy may be reinvigorating from its slump sent bond prices down. The NAPM for non-manufacturing rose to above the 50 level associated with economic activity that is slowing or moving toward recession. September bonds
(
USU1 |
Quote |
Chart |
News |
PowerRating) fell to a one-month low as the fresh economic news raised the possibility that the Fed may be near the end of its easing cycle. Many still anticipate the Fed will cut rates an additional 25%.
The slightly stronger economy in the US also sent dollar index futures
(
DXU1 |
Quote |
Chart |
News |
PowerRating) to a new contract high. The DXU1 shot out of a two-step pullback from highs and closed up 1.38 at 121.21.
The most heavily weighted currency in the dollar index basket — the Euro — slumped to claim a new contract low mark, ending down .01140 at .83540.
Crude oil rallied after the API’s weekly inventory report showed the first draw down in oil stocks in weeks. August crude
(
CLQ1 |
Quote |
Chart |
News |
PowerRating) gained .78 to 27.02.
The soy complex is dominating the Momentum-5 List, claiming the number one, two, and three slots after last week’s change in the fundamental picture from the USDA that forecast a smaller carry over of grain stocks. Sep beans
(
SU1 |
Quote |
Chart |
News |
PowerRating) were up nearly 10 before settling 5 1/4 higher at 481 3/4.