Crude Rises on the Dollar’s Decline

The metals closed the New York trading day only marginally higher after Gold was unable to hold the magic $1000 level.v Despite the sharply higher Euro and a $3.00 jump in the price of Oil; the metals finished the day only a shade higher and well below the session highs.

Silver closed up 8 cents at $16.42. Gold finished at $997.00 up $1.10 per ounce. Palladium slipped $3.00 to $292.00. Platinum rose by $16.00 to $1280.00. Volume was moderate.

Over in the currencies the Dollar continued to weaken on fears of Chinese Dollar liquidations and growing concerns of U.S inflation. Last on the Euro $1.4504 up 1.69 cents against our Greenback.

Crude rose on the back of the weak Dollar gaining $3.38 per barrel to $71.40. Remember tomorrow’s OPEC meeting. Stocks are also well off the session highs with the Dow Jones industrial Average currently sitting at 9469 up only 27 points.

When we return tomorrow traders will have two fresh pieces of data to contend with. We get the Weekly Oil Inventories and the latest Fed Beige Book. The Beige Book; named for the color of it’s cover is an anecdotal compilation of business conditions in the 12 Federal Reserve Bank districts.

Tomorrow’s economic calendar:

RESERVE BANK OF NEW ZEALAND Rate Decision
OPEC Meeting
Weekly Oil Inventories
U.S. Fed Beige Book

Will PMI Break 50? Traders Waiting to See

In the currency market, last on the Euro $1.4274 down 76/100ths of a U.S cent. The Dollar is trading on a firm note with Wall Street expecting to see further improvement in the manufacturing sector this morning. The Chicago Purchasing Manager’s Index of Manufacturing (PMI) is expected to clock in with a reading of 47.2, up again from the prior month’s 43.4. Some traders think we might actually break the 50 level. A reading of 50 or higher represents expansion in manufacturing sector. This would be a very positive economic signal.

Metals are trading flat to lower this morning after last Friday’s sharp gains. Traders are pointing to a 6% decline in Chinese stocks; and a bounce in the U.S Dollar for this morning’s lower levels. Silver is down 10 cents at $14.65. Gold is $3.00 lower and trading at $954.00. Palladium remains $1.00 higher with the last trade at $287.00. Platinum is $1234.00 down $11.00.

Over in the energy markets the price of Crude is down $1.66 per barrel on nervousness surrounding severe Chinese stock market losses. Last on Oil $71.08. U.S stocks finished last Friday with a 36 point loss snapping an 8 or 9 day run of positive closes. On an overall basis the Dow gained 38 points for the whole of last week. This morning the index is being called to open 62 points lower in sympathy with Asian and European markets.

On the geo-political front; Japanese voters ushered in a new era in Japanese politics with a sound thrashing of it’s Liberal Democratic Party at the polls. Voters have decided to turn to new leadership after 50 years of business as usual.

Today’s economic calendar:

U.S. Chicago PMI
U.K. Markets Closed

Traders Nervous in Advance of Bernanke’s Speech at 10AM

Metals are changing hands in a mixed and quiet fashion. Silver is 7 cents higher at $13.99. Gold is $943.005 up $1.25 per ounce. Palladium is $1.00 lower at $275.00. Platinum is down $3.00 and trading at $1239.00.

The lack of activity is being ascribed to nervousness in advance of today’s scheduled speech by Fed Chairman Bernanke at 10 am eastern. Expect Dollar volatility. The head of the Fed is expected to make remarks about the economy at the Annual Fed Symposium in Wyoming. Of greater concern should be whether Mr. Bernanke gets a second term, with President Obama to make that decision shortly. Early indications warn that a change at the helm of the Fed would cause a major stock market shake out.

Speaking of the stock market; the Dow ended Thursday with a 70 point gain and appears to be headed for another 40 point gain this morning with traders expecting to see a slight improvement in this morning’s release of Existing Home Sales. The latest estimate calls for a reading of 5 million units compared to June’s 4.89 million. Just another example of bad but better.

Meanwhile over in the energy markets the price of Oil continues to rise with electronic trading showing a gain of 76 cents to $73.74. Keep in mind the recent rise in the price of Oil is a two edged sword. Rising prices implies higher demand and greater economic activity, but rising prices also tend to divert consumer spending dollars which will ultimately hurt economic expansion.

In currency trading we find the Euro up 76/100ths of U.S cent in advance of the Bernanke speech; and in line with the weaker Dollar and higher oil. Last trade $1.4320.

In global matters; Iran has suddenly agreed to allow greater monitoring by U.N. inspectors of a uranium-enrichment facility, ending a long standing diplomatic impasse. You get the sense that Iran is trying to divert world attention from it’s current social unrest. In a final note; Cash for Clunkers will officially end next Monday.

Oil Breaks the $70 Psychological Barrier, Dollar Continues to Slide

The new trading week opens with the metals trading on a positive note. Silver leading the complex. With the U.S economic outlook brightening; commodities across the board are rising in the anticipation of higher demand. Silver is up 28 cents at $14.20. Gold is $2.00 higher changing hands at $956.00. Palladium is $265.00 up $3.00. Platinum is up $6.00 at $1217.00.

Metals are keying off of Oil which has broken through the $70.00 resistance level. Last on Crude $70.01 up another $1.56 per barrel. In the currencies the Dollar continues to slide against the Euro reflecting the rise in Crude prices. Last on the Euro $1.4292 up 32/100ths of a U.S cent.

Over in the stock market the Dow looks about 88 points higher on the growing positive economic sentiment which includes today’s economic data. Traders are anticipating more bad but better economic numbers with June Construction Spending expected to show a decline of .6%; better than the prior month’s decline of .9%. Wall Street also expects to see added improvement in manufacturing when the Institute for Supply Management index of Manufacturing (ISM) reports for the July period. Look for a reading of 46.5 compared to June’s 44.8.

Later today the auto manufacturers will report their July sales. Given the positive response to the Cash for Clunkers stimulus; the Street expects to see a surge in July auto sales. Truck sales are in question. This weeks trading activity will also reflect and lead up this Friday’s U.S Employment data where traders around the world expect to see a sizable improvement in the number of lost jobs. More on that later in the week. On the global front Iran continues to hold mass trials for reformist leaders charging them with attempting to overthrow the current regime.

Dollar Hits a 7 Week Low

The dollar hit a seven-week low versus a basket of major currencies on Wednesday as steady stock markets and data showing stronger U.S. home prices offset weak bank earnings, denting the greenback’s safe-haven allure.

Gold is quiet and trading at 952.00 unchanged. Silver is 13.75 up 5 cents, platinum is now 1173.00 down 2 dollars and the Euro is 142.20 down 10 points.

The Nasdaq rose on Wednesday for the 11th straight day, buoyed by solid profits from Apple Inc and Starbucks Corp,while disappointing bank results and declining energy shares weighed on the broader market.

DATA EVENTS * The following data is expected on Thursday: – French business climate for July – Euro zone current account data for June – UK retail sales for May) – Weekly U.S. jobless claims – U.S. existing home sales for June.

Next Page »