Why Traders Are Reassured Today
Futures led the charge on the first day of
the last Quarter of 2002. US stocks rallied after Fannie Mae, the largest
home-mortgage buyer, reassured investors falling interest rates won’t crimp its
earnings and Verizon Communications
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profit forecast. At the end of trade, Dell Computer
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it will exceed earnings expectations for the third quarter.
In a separate newsworthy story, UN officials said Iraq agreed
to terms for the return of weapons inspectors, helping send the Standard &
Poor’s 500 Index
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PowerRating) to its biggest gain since August and the
Dow Jones Industrial Average to its largest advance in more than two months. The
S&P futures for Dec.
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retracement drawn from the July low to the August high. This is also above where
the 2.0 Volatility Band is on the S&P 500 cash index. SPZ2 closed higher by
39.50 or 4.85% at 854.10.
After hitting extreme lows yesterday, the
Nasdaq 100 futures for Dec.
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PowerRating) rallied back strongly today, moving up
by 6.29% to 886.50. the Nasdaq 100 futures had a gain of 52.50.
US Treasuries dropped for the first day in three after Fannie Mae said it increased its
protection against falling interest rates. This is fueling speculation the
mortgage financier would buy fewer government securities. Treasuries briefly
pared losses as an industry report showed US manufacturing contracted for the
first time in eight months. Bonds are on the decline. The 10-year note for Dec.
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PowerRating) is trading at 115 070 down 220 and the Dec. 30 year
bond is trading at 113’10 down ’30.
In the energies, Nov. crude oil
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$30.82 a barrel. Nov. heating oil
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a gallon; and Nov. unleaded gasoline
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at 82.70 a gallon. Nov. natural gas
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close at 4.07.
In the grains, Corn futures at the Chicago Board
saw mixed action, before moving higher later in the day, with prices closing 4
cents up in a mild rebound off Monday’s steeper sell-off. Dec. corn
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PowerRating) ended at $2.55 1/2 a bushel. Nov. soybeans
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the 5.40 support level and then retraced back up to close at $5.41 1/2 a bushel
down 2 2/4 cents. Dec. wheat
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PowerRating) challenged the 4.00 resistance
level, then slipped below it to close at $3.97 a bushel, an increase of .50 of a
cent.
In precious metals, gold and silver gave up some
of yesterday’s gains. Dec. gold
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a troy ounce. Dec. silver
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close at 4.48 1/2 an ounce, a loss of 6.29 or 1.39%. Copper for Dec.
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PowerRating) rebounded off of the 84% retracement level (.66176). Copper rallied
to close at 67.04 a pound, up .45.