Sell-Off in the Oil Futures Markets

The metals with the exception of Palladium closed broadly lower today in a knee jerk reaction to a sell-off in the oil markets and a sympathetic counter surge in the Dollar. To explain today’s events: It started with traders running for the exits in the oil futures markets in response to today’s Congressional hearing surrounding possible restrictions on oil speculation. Congress is putting on a full court press in an effort to stop the volatility in oil trading by limiting speculation. As a result speculators ran for cover. Crude Oil fell $1.48 per barrel to $66.90.

Currency traders pushed up the Dollar in sympathy with the decline in Oil. The Euro gave up it’s early session half cent gain then continued falling by 46/100ths of cent to it’s present level of $1.4169.

Metals traders got spooked pushing the metals complex lower in reaction. Silver closed at $13.78 off 25 cents. Gold fell $15.00 to $938.00. Palladium managed to end the session with a $2.00 gain at $262.00. Platinum dropped by $27.00 to $1189.00. Volume was moderately heavy.

Stocks turned lower today on mixed economic data and another barrage of bad corporate quarterly earnings results. As for the data; the Case Shiller Home Price Index clocked in with a smaller than feared price decline. Prices fell an average of 17.06%. The Street expected the drop to be 17.9%. That was the good news.

The bad news came when Consumer Confidence was reported at 46.6; worse than the estimate of 49. The one two punch of confidence and earnings has the Dow currently down 56 points with two hours left in the trading day. Tomorrow the calendar remains active with Durable Goods, the Weekly Oil Inventories, and the Fed Beige Book.