Uncertainty Weighs....
March 22nd, 2010 by Cale McCulloch
Closing Data
| Current | Change | % | |
|---|---|---|---|
| Dow Jones | 10,741.98 | -37.19 | -0.3% |
| NASDAQ | 2,374.41 | -16.87 | -0.7% |
| S P 500 | 1,159.90 | -5.92 | -0.5% |
| FTSE 100 | 5,650.13 | 7.51 | 0.1% |
| Nikkei 225 | 10,824.72 | 80.69 | 0.8% |
| ASX 200 | 4,831.70 | -40.5 | -0.8% |
| COMEX Gold - Dec 09 | 1,107.60 | -19.9 | -1.8% |
| COMEX Silver - Sep 09 | 17.032 | -0.39 | -2.2% |
| COMEX Copper - Sep 09 | 337.25 | -2.3 | -0.7% |
| WTI Spot | 80.89 | -1.49 | -1.8% |
| AUD-USD | 0.9155 | -0.0055 | -0.6% |
| Aluminium | 2,233.00 | -9.5 | -0.4% |
| Copper | 7,461.00 | -27 | -0.4% |
| Lead | 2,210.50 | -34.5 | -1.5% |
| Nickel | 22,700.00 | 575 | 2.6% |
| Tin | 17,675.00 | 120 | 0.7% |
| Zinc | 2,287.50 | -28.5 | -1.2% |
US markets gave back some of the recent gains on Friday night, with the Dow slipping 37 points while the S&P 500 gave back 6 points. Markets don’t like uncertainty, and ongoing concerns about Greece led money into the US dollar for safety, which has, in turn, sparked a sell off in the commodities. Some uncertainty surrounding the Health care reform bill that was due to be voted on Sunday (US time), saw investors be prudent and take some of the recent gains off the table.
News that India increased interest rates by 0.255, along with their repurchasing rate to around 5%, showed the Government is concerned about the countries current growth rate. Markets have been so focused on news out of China of late that India became a sleeping giant with an incredibly high growth rate, and news that the government is attempting to take some heat out of the economy through monetary tightening appears to have shocked the world markets somewhat. The news applied further downward pressure to commodity prices Friday night.
Markets are awaiting the result of the senate vote on Healthcare reform underway at present, with current market expectations of a YES vote sitting at 78%. Personally, I am unconvinced that this will go through but we should know this morning. A yes vote could see some confidence come into the markets today, while a NO will only add to uncertainty and likley trigger bigger sell offs throughout the Asian session.
Weakness in commodities, including a USD 20 per Troy ounce fall in Gold, USD 1.50 a barrel off the price of Oil, along with broad weakness in Base metal (nickel being the only exception) will weigh on the miners domestically this morning. BHP ADR trading in NY shows a close of $42.49 compared with some 43.20 domestically on Friday.
The SPI has us opening lower by just 19 points but we will probably test support at 4840 throughout the session.
Contact your Freeman Fox Stockbroker on 07 3031 9960 or 1800 003 369 Ext 7.
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