Three Reasons For The Drop Off
In today’s trade, the markets looked as if
they were headed higher. Both the S&P 500 and Nasdaq 100 futures opened
positive and then retreated to test this (Sept.) month’s lows. Three reasons for
the drop off are the usual suspects. A slow economy, weaker corporate earnings,
and a potential war with Iraq. The Dec. S&P 500 futures
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end at 872.50. The Dec. Nasdaq 100
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18.90 point loss.
This morning Iraq announced that they would allow
U.N. weapons inspectors in to its country. This was reportedly without preconditions. This news prompted a decline in Oct.
crude oil
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let weapons inspectors into military sites and nowhere else.
When it looked like Iraq may be reneging on their previous statements, the energy markets
began to rally from the lows of the day. Oct. crude oil ended unchanged at
$29.08 a barrel. Oct. unleaded gasoline
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a gallon, down 1.71 cents, or 2.15%. Oct. heating oil
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1.12 cents, or 1.43% to 77.25 a gallon; and natural gas for Oct.
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News on Iraq and a sluggish Manufacturing Report
sent Treasuries higher. The Dec. 10-year note
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new 20-day high, by closing at 114.01, up .12, and the Dec. 30 year bond
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The Dec. dollar
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been rallying, gave up much of the solid gains that were made overnight and in
the early morning sessions. The dollar closed weaker against the other currencies.
Weaker-than-expected earnings on stocks are the blame for the drop. DXZ2 closed
at 108.81, up .02.
The mixed signals from Iraq made the metals
markets mixed in turn. Dec. gold
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troy ounce. Dec. silver
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Dec. copper
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In the grains, the major players resumed their
rallies from the pullback from the highs. Dec. wheat
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4.50 cents, or 1.12%, to close at $4.05 1/4 a bushel. Dec. corn
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climbed .50 cent to $2.76 1/2 a bushel; and Nov. soybeans
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posted a .50 gain to end at $5.73 a bushel.