Gold, Oil Lower, Dollar on the Move
U.S. bond markets were closed in observance of Columbus Day. However, the IEF,
a 7-10 year bond iShare, rose despite Friday’s positive jobs report.
The dollar rose versus the euro and the yen today, as traders dropped bets
that the Fed would cut rates by the end of this month. On Friday, the U.S.
reported an unexpected jobs boost, and also put out revised numbers from August
which were also better than expected. Combined with U.S. equity strength, the
recent jobs number boosted U.S. confidence, and the dollar is rising as a
results. The yen was up slightly versus the euro, but the major action
surrounded the dollar.
Crude oil futures fell nearly 3% to close under $80 a barrel today, as
traders downshift Q4 seasonal demand figures after a strong summer. Crude oil
fell over 10% before rallying to new record highs, but have since plummeted off
of those records. Traders at first were looking for strong demand during Q4
which would not be able to keep up with supplies. Days into Q4, however, traders
are backing off heavy long positions, and crude prices are plummeting as a
result of that. Natural gas futures fell over 3% today.
Gold futures fell over 1% today, on expectations that dollar strength will
run into the week. Gold normally trades inversely to the dollar and with oil,
which is exactly what happened today. Dollar strength led to gold selling today,
as traders turned to U.S. strength instead of gold safety. Copper futures fell
nearly 3% today.
Grains fell across the board today. Soybeans dropped 1.6%, and corn fell
0.7%.
Stocks closed mixed on Monday, with the Dow and S&P 500 posting slight
losses, while the NASDAQ recorded a small gain. Click
here to read the rest of today’s
Stock Market Recap.
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