Why The Dow Rallied Today
Stocks remained higher Tuesday afternoon
following an expected decision by the Federal Reserve to leave interest rates
unchanged.
In its announcement, the Fed said the economy is “expanding at a significant
pace” and declared the risk of economic weakness equal to that of inflation, a
more upbeat outlook than in previous policy statements.
Blue chips got a further boost from Procter & Gamble, which issued an upbeat
earnings outlook.
Shortly after the central bank’s decision, the June Dow Jones Industrial
Average
(
DJM2 |
Quote |
Chart |
News |
PowerRating) rallied and closed at 10670.000 up 89.000 or .84%.
The June Standard & Poor’s 500-stock index
(
SPM2 |
Quote |
Chart |
News |
PowerRating) rose 7.300 to
1174.500.
The June Nasdaq 100 futures
(
NDM2 |
Quote |
Chart |
News |
PowerRating)
were working their way up to the 1530 resistance line, but the uptrend was
broken and NDM2 ended falling lower to end negative at 1510.500 down .500.
Bonds slipped and the dollar dropped lower. The June 30 yr bond
(
USM2 |
Quote |
Chart |
News |
PowerRating)
slipped .38 to 98.719 and the June 10 yr note
(
TYM2 |
Quote |
Chart |
News |
PowerRating) fell .200 to
102.797. The June dollar
(
DXM2 |
Quote |
Chart |
News |
PowerRating) ended at 117.94 down .010.
May soybean futures
(
SK2 |
Quote |
Chart |
News |
PowerRating) sank midday Tuesday on the Chicago Board of Trade,
extending a significant selloff to a second day.
After taking a hammering on Monday, May soybean
(
SK2 |
Quote |
Chart |
News |
PowerRating) prices opened
slightly higher in a technical correction Tuesday but reversed course when
buying interest turned out to be mild. Weakness in the soyoil market and a
scarcity of new export deals pressured prices. May soybeans fell 2 3/4 cents to
$4.57 3/4 a bushel. Then after putting in a double bottom on the intraday chart
and hitting its low point of the day at 4.56, the beans for May delivery rallied
hard for the last hour of trade to put in a gain for the day closing up at 4.64.
Other grains closed positive also. May corn
(
CK2 |
Quote |
Chart |
News |
PowerRating) rose 1/2 cent to
$2.06 3/4 a bushel on lackluster demand for U.S. exports.
Wheat prices were flat after rain on the Plains, which improved the winter-wheat
crop outlook. Wheat for May delivery
(
WK2 |
Quote |
Chart |
News |
PowerRating) rallied higher to 2.81 a
bushel. A gain of 1.17%.
Crude-oil futures were nearly flat after
breaking into the $25 a barrel range yesterday. April crude-oil futures
(
CLJ2 |
Quote |
Chart |
News |
PowerRating) shed 3 cents to $25.08 a barrel on the New York Mercantile
Exchange in earlier trade, then broke down and closed lower at 24.99. April
heating oil
(
HOJ2 |
Quote |
Chart |
News |
PowerRating) edged lower to .36 to 66.12 and April unleaded
gasoline
(
HUJ2 |
Quote |
Chart |
News |
PowerRating) dropped .20 to 83.16 cents a gallon. Natural gas fell 7
cents to $3.24 per million British thermal units.
Precious metals were trading higher amid an
extension of gains in gold futures. April gold
(
GCJ2 |
Quote |
Chart |
News |
PowerRating) on the Comex
division of the New York Mercantile Exchange traded to a high at $294 early and
was sold down to $293.20 a troy ounce, 90 cents above Monday’s close. May
silver
(
SIK2 |
Quote |
Chart |
News |
PowerRating) rose 2.0 cents to $4.52 an ounce. May copper
(
HGK2 |
Quote |
Chart |
News |
PowerRating) broke above the 76 resistance level yesterday. Today copper
continued its bullish move upward gaining .600 or .78% to 77.050.