Will Oil Continue To Slide?
Iraq’s agreement to
destroy missiles cooled off the threat of war. That, along with a
barrage of positive economic data, helped spark buying in stock index futures
while oil slipped for the second straight session.
Stock index futures managed their second
consecutive day of gains, a feat not seen for almost two weeks. News that Iraq
has agreed to start destruction of their Al Samound 2 missiles tomorrow
will make it more difficult for the US to gather more support for an attack.
Positive economic data also helped inspire today’s rally. GDP for fourth quarter
2002 grew at an annualized 1.4% or double previous estimates of 0.7%. The
University of Michigan’s reading of consumer sentiment came in at 79.9
beating estimates of 79.1. Consumer confidence has been weighed down by war and
terrorism threats, rising oil prices, and a stagnate job market. Regional
manufacturing activity as measured by the Chicago PMI came in at 54.9 beating
estimates of 52.5. Readings above 50 suggest growth.
The dollar however did not benefit. The March
dollar index
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Despite positive economic news, bond futures
rallied to new highs. The 30-year contract
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and the 10-year contract
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Crude oil pulled back for the second consecutive
session. April crude
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PowerRating) lost 0.50 to 36.60. Crude slipped as the
potential for war eased. Support comes in at 35.50.