Why Bond Traders Are Relieved
Bond
traders
were relieved
that there was no big jump in consumer prices,
as there was in producer prices
a few days ago. US exports of goods and services were down .4% in September
and imports were down .5%. US consumer prices were
up .3% in October and up 2.0% from a year ago. The core rate gained .2% in
October. The Dec. 10-year note
(
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PowerRating) gained .23 to 114.14
and the Dec. 30 year bond
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rose .56 to 112.09.Â
Two issues that pushed
energies lower today were nervousness about UN inspectors in Iraq and more
conflict in Israel. In addition OPEC said today that they expect 2002 world
demand to come in at 76.5 million barrels per day (mbd) and 2003 demand to come
in at 77.2 mbd. This compares to U.S. Energy Department estimates of 76.3 mbd
and 77.6 mbd respectively.
Crude oil for January delivery
(
CLF3 |
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PowerRating) dropped .32 or 1.24% to $25.50 a barrel. Jan. heating oil
(
HOF3 |
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PowerRating) dropped .45 of a cent to 72.29 a gallon. Jan. unleaded
gasoline
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HUF3 |
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PowerRating) lost .90 of a cent or 1.29%to 69.09 a gallon.
Jan. natural gas
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PowerRating) was unchanged at 4.34.
The Dec. Standard & Poor’s 500 futures
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dropped for a second day in a row on a see saw trading day. The SPZ2 closed at
898.10 below the 900 support level. This was a loss of 1.60.
The Dec. Nasdaq 100
(
NDZ2 |
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PowerRating) took a bigger hit, falling 18.50 or 1.76% to 1032.50.
At the Chicago Board Of Trade (CBOT) Jan. soybeans
(
SF3 |
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PowerRating) rose up 7 cents or 1.24% to $5.73
1/2 a bushel. The move was helped by talk that China may be up for buying more
soybeans from US
farmers. On the daily chart Jan. beans
are forming a cup–and–handle
pattern. Today beans attempted to break the 5.76 resistance level, but pulled
back to close at $5.73 1/2 a bushel. In
addition, the corn and soybean harvests are nearly complete.
March
corn
(
CH3 |
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PowerRating) rallied back above the 2.46 resistance zone to end at $2.46
3/4 a bushel up 2 1/4 cents.
March wheat futures
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WH3 |
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to close right at the 3.80 resistance line. It was a rally of 2 3/4 cents to
$3.80 a bushel.
And Dec. soy meal
(
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PowerRating) attempted to break above 168, but settled down to 167.09, a gain
of 1.
In the metals, Dec. gold
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dropped .70 cents to $318.69 a troy ounce
Dec. silver
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Ivory Coast rebels submitted their proposals to
the peace talks today. The two sides still seem far apart in their
demands.
March cocoa
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PowerRating) was down $4 at $1,748.
March coffee
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PowerRating) was up 1.00 or
1.435 at 70.84 despite a 10-day forecast that shows numerous chances of rain in
southern Brazil. Highs are expected to be in the mid to upper 80s.
March sugar
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PowerRating) shrugged off a
report from the International Sugar Organization, just as it has all the other
bearish reports this year. The report increased the 2002-2003 estimate of world
sugar production to 141.8 million tons, resulting in a surplus of 4.36 million
tons. This is higher than their 3.66 million ton surplus estimate of two months
ago. Sugar rose .48 or 7.04% to 7.29.