Are Lower Oil Prices In Our Future?
Crude oil dipped lower for the second day
as talks of increased production has put a halt to the 20%+ rally since the
Venezuelan oil strike began on Dec. 2. There is also talk that OPEC will boost
production by half a million barrels a day if oil prices stayed above $28 for 10
more days. Recently Venezuelan Energy Minister Rafael Ramirez said that he
expected production to double to 1.2 million barrels per day or approximately
40% of their normal 3 million barrel production regimen. February
crude
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its 38.2% retracement from the November 14th low. At the close, the February
contract fell 0.17 to 31.20.
Treasuries looked to continued their recent rallies as the worse than
expected December consumer confidence number put a damper on the stock market.
However this was not to be, as stocks later recovered. The March 30-year
contract
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In an environment of geopolitical tension, high oil prices, low interest
rates, and a unstable economic recovery, the dollar had its biggest monthly
decline since this past June against the Euro and Yen. The March Dollar index
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0.00250 while the March Yen slipped 0.000020 to 0.008447.
Stocks index futures had a somewhat volatile session ahead of the New Year’s
holiday tomorrow. Stocks fell sharply after the December consumer confidence
index fell to 80.3 from 84.9 in November. Consumer confidence has fallen the
last six out of seven months. Many economists were looking for a reading of 86.
The March S&P
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points earlier in the session. However the March Nasdaq contract
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didn’t recover and ended lower for the fifth straight session. The Nasdaq
futures were off 9 points to 984.00. Stocks have now had three consecutive
losing years.
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