Will The Turnaround Continue?
Continuing worries over a war with Iraq
and the lowest level of consumer confidence in over nine years initially took
stocks down, but stock index futures later made a dramatic recovery. Bonds ended
higher for the second session, but well off their highs. Meanwhile energies had
a wild ride and gold backed off after hitting resistance.Â
Stock index futures made a huge midday turnaround after weakness brought on
by the much worse-than-expected consumer sentiment number. The continuing threat
of war and North Korea’s testing of short-range missiles also added to
uncertainty in the market. Dow and S&P futures were off more than 155 points
and 15 points respectively during the low of the day. At the close, the March
Dow futures
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939.90, and the NDX
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short covering remains to be seen, but the ability to discount negative news is
positive.Â
The dollar also ended higher as stocks recovered. The March dollar index
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Treasury futures jumped after consumer confidence in February fell to a
nine-year low. The Conference Board’s consumer confidence index dove to a
reading of 64 form 78.8 in January. This month’s drop was the largest since a 17
point drop in September 2001. Worries about the job market, stock market, rising
oil prices, terrorism, and the pending war with Iraq put a drag on confidence.
Both the 10-year and 30-year contracts made new contract highs, but ended the
session near the lows of the day as stock futures made a recovery. The 10-year
contract
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15/32 to 114 2/32. Stochastics readings on both contracts are showing negative
divergence.
April gold back off after hitting resistance. April gold
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4.20 to 352.40 after finding resistance at its 38.2% retracement level.
Energies traded at all time highs early in the session, but headed lower
after the government said that they are ready to release reserves when war
breaks out. April crude
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37.10, April heading oil
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at 118, and April natural gasÂ
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