Is There More Upside For Bonds?
The increasing threat of war with Iraq,
worries over North Korea, and heightened alert of terrorist activities took
stock index futures down and treasury futures up. Meanwhile, crude pushed
another two-year high, and gold fell for the sixth-straight day. NATO again
failed to agree on military assistance for Turkey. Then there is speculation
that the U.S. will attack without U.N. approval. Earlier today, there was a
rumor going around that France will now back the U.S. in a war against Iraq.Â
U.S. intelligence officials revealed that North Korea has missiles that could
potentially hit Western parts of the United States.Â
After raising the nation’s security alert to “orange” last week, the Pentagon
has now stationed mobile anti-missile units as well as surveillance aircrafts in
response to possible terrorist activity.
Stock indices futures are once again lower on the news of the increasing
fears of war. Both the Dow and S&P futures traded in a slow and grinding fashion
and took out Monday’s lows. Many analysts are looking for a retest of last
October’s lows. At the close, the March Dow futures
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7735, March S&P
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Treasury futures broke out of the triangle mentioned yesterday. Despite an
increase in supply from this week’s note auction and competition from corporate
bonds, investors are still going to government debt for safe haven. The March
30-year contract
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contract
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Despite an unexpected rise in last week’s gasoline supplies, crude oil
continued its rise. The Department of Energy reported that gas supplies rose by
1.4% or 3 million barrels while many analysts were looking for a drop of 1.5 to
2 million barrels. March crude
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to 35.77.
April gold
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dropped nearly $30 since its high on Feb. 5. The April contract
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dropped 10 to 353.