Which Traders Believe In This Rally…
As good a day as it was for the equity
market, it was a hard day for the Treasury market which experienced
the heaviest losses in months. It really looks like
bond market participants clearly believe in this stock rally: The Dec.10-year
note
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165. The yield rose 20 to 4.01%, almost a full half percentage point
higher than the recent low of 3.54%. The Dec. 30-yr bond fell down 2’05 to
110’05. There have been rumors surfacing about a “large account” (Warren
Buffett’s name has been tossed around amid the rumors). This has some
investors shifting out of bonds and into stocks since last Friday and has been a
catalyst for the weakness in the Treasury market and the strength in the equity
market.
The Strong Dec. S&P 500 futures
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Citigroup
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earnings. The SPZ2 closed at 882 up over 4.80% a 40.39 move.
Click here for some key levels from Carolyn Boroden’s Futures
Perspectives.
The Dec. Nasdaq 100 futures
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were fueled in the morning by positive comments from a Goldman Sachs analyst on Microsoft
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expected to either meet or beat their earnings estimates. NDZ2 closed at 950 up
42.50 or 4.68%.
In the grains traded at the Chicago Board of
Trade (CBOT) there were some powerful moves to the upside. The improving stock
markets and economic tone in Asia this morning combined with hot and dry weather
trend developing in Brazil were factors which helped spark the rally in grains.
The Nov soybean contract
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3/4 cents or 2.96% to end at $5.84 a bushel. The big move higher maybe confirmed
that a harvest low is in place. The USDA has forecast a sharp drop in usage this
year and extremely tight ending stocks; world and US. If demand numbers need to
be adjusted higher, prices appear too cheap and we could see more movement to
the upside. Initial resistance is at 5.49 with secondary resistance at 5.62.
December corn
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9 cents or 3.67% to $2.54 a bushel. Support for December corn comes in at 245
today with 255 as initial resistance — the 50% retracement.
December wheat
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a bushel.
The energy market’s were weaker today. Crude oil
fell on expectations that the American Petroleum Institute later today would
report a rise in US inventories.
Supplies probably rose between 1.9 million and 2.6 million barrels in the week
ended Friday from 273.3 million barrels a week earlier, according to 10 analysts
surveyed by Bloomberg.com. Ports and production platforms along the Gulf of
Mexico returned to normal operations last week after closing for Hurricane Lili.
Nov. crude oil
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close at $29.69 a barrel down .33 or 1.10%. Nov. heating oil
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lost .99 of a cent down to 79.90 cents a gallon a 1.22% loss. Nov. unleaded
gasoline
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.84 cents a gallon and Nov. natural gas
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4.24 down .06.
The metals were mixed, with Dec. gold
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a troy ounce. Dec silver
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Dec. copper
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