Tech Futures Bolt Back
Traders jumped back into tech futures with both feet as their equity
counterparts snapped up some of the recently best names in the growth complex
what some perceived as bargain prices. Big-ticket winners, stocks such as SDLI,
Juniper Networks
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PowerRating) tallied gains between 10% and 17% higher, making a comeback from recent batterings as positive
results from French Alacatel enhanced the sales outlook for their networking
hardware and software. Sun Micro
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PowerRating), Cisco
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the best gains among the biggest cap Nasdaq 100 index stocks. December Naz
futures
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More evidence of economic slowing–including a consumer
confidence rating coming in at a one-year low–worked to boost the view that the
Fed is done with its interest-rate raising campaign. A slower National
Association of Purchasing Management-Chicago reading also helped forward the
view that interest rate hikes by the Fed are through and that we could possibly
see a loosening of monetary policy in the not-too-distant future.Â
Blue chips also caught on after poor earnings hit Dow
component Procter & Gamble. Dow futures
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PowerRating) closed up 125.0
at 11,022.0 and
December S&P futures
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T-bonds
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PowerRating), from the Momentum-5
List, initially rose on news that the economy is slowing. But the strong
rally in techs caused traders to rotate out of bonds to participate in the rally
in beaten down growth stocks. T-bonds
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one-point range to close 16/32 lower at 99 27/32.
However, December dollar index futures
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did not confirm the rally in tech futures. Dollars did come back from a dip on
the large rally in blue chips Monday, so their action may act as an indicator
confirming the up-movement in blue chip equities (should that trend continue).
The apparent slowdown in the US economy, and evidence that the European Central
Bank may raise interest rates to cool higher wholesale inflation (four countries
comprising 40% of Europe’s GDP reported their PPI-equivalent was an average 1%
higher on Tuesday) are also boosted
euro FX
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PowerRating) futures at the expense of the dollar. ECZ0 closed .00650
higher at .85080 while the DXZ0 finished down .58 at 116.62.
Energies contracts
seeped lower for a third day but came off their lowest levels leaving Turtle
Soup-like tails in the heating oil and unleaded gasoline contracts. Since most
OPEC members are producing at near-capacity, Ali al-Naimi, Saudi Arabia’s oil
minister, said his country would be ready “to meet the need” should
additional output be required, ostensibly to match the $22-$28 price-band
mechanism agreement that has recently mandated an increase of 500,000 barrels
per day. The market may also not want to be caught short ahead of Tuesday
evening’s weekly API report on oil and distillate stockpiles. December crude oil
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.0093 to .9358, and
unleaded gasoline
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Forecasts for mild temperatures across the central and
eastern parts of the United States, areas that are the largest consumers of natural
gas for heating fuel purposes, sent the December contract
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(from the Implosion-5 List,)
to a two-month low. NGZ0 rallied from lows despite some analysts’ predictions
that Wednesday’s storage injection figures would sharply narrow the current
perceived storage shortfall. NGZ0 managed to finish the day .015 higher at
45.000.
In grain trading, corn staged its best gain in
three months, adding 5 1/2 to 206. No buyers were found after December contract
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dipped briefly below the $2 a bushel level. Funds were said to be large buyers,
snapping up over 50,000,000 bushels. Corn hinted it could make a
larger-than-normal move by registering on the Multiple Days Low
Volatility List.Â
Orange juice
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PowerRating), from the Implosion-5 List,
closed at a three-year and contract low and on the bottom of its range, down .65
at 66.20. The USDA’s report that Florida’s crop would be the second
largest ever continues to weigh on the contract.