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Monday, November 9, 2009

Morning Market Report

Friday was an interesting day in the market. They all are following the release of the jobs report. The market initially looked like it was headed for a bloodbath. The Dow was down near 100 points in the morning. Then, it turned around. It got up about fifty points. Then, the markets bounced up and down until the Dow was up 17 points in the end. The NASDAQ and S&P were also up on the week. It was the best week for the Dow in about a month. It ended above 10,000.

Futures are pointing upward this morning. First, there's news that the G20 has made a commitment to continue with stimulus until the recession ends. Those sorts of commitments are usually meaningless and the worth of such a policy is dubious but the Dow is up about two thirds of a percent following the news.

Oil is rising from fears of Hurricane Ida. It's currently up 91 cents a barrel to $78.34 a barrel. It lost about five dollars a barrel over the previous week plus and so this will be one to watch. The ten year U.S. Treasury bond continues to hover around 3.50%. It's currently at 3.49%. That's down just slightly but still represents a rise of just below 20 basis points over the last week and a half. The yield spread between the two and ten year has tightened slightly to 2.65% but still represents a massive intermediate rise and is still just below the all time record of 2.75% set in June. So, it still represents plenty of long term inflationary pressure. Bonds in Britain were mixed while in Germany they got slightly better. Finally, $90 billion worth of new bonds will be auctioned this week, including $30 billion in three year bonds today, and that usually drives the bond market.

Markets everywhere looked good today. In the Far East, the Hang Seng in China was up 1.73%, the NIKKEI in Japan was up .2%, and the Straits Time Index in Singapore was up 1.32%. In Europe, the FTSE in London was up 1.37%, the DAX in Germany was up 1.58%, and the Spanish index was up 1.06%.

The dollar is showing weakness this morning. It's down 1.03% against the Euro, down the same against the British Pound, and even against the Japanese Yen.

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