Pre-Market New And Views
This morning the S&P 500 e-mini futures contract(ES H1) is trading lower by 7.25 points to 1307.75. The futures have come under pressure as the Asian market tumbled last night. The highly important Shanghai Index(China) traded lower by 1.51 percent. Whenever, the leading Asian stock indexes decline sharply this will usually put selling pressure on the leading commodity stocks in the United States. This morning Cliffs Natural Resources Inc.(NYSE:CLF) which is a leading iron ore pellet producer is trading sharply lower before the opening bell. Other leading commodity stocks that are declining before the stock market opens are Freeport McMoRan Copper & Gold Inc.(NYSE:FCX), and United States Steel Corp.(NYSE:X).
Spain was downgraded by Moodys last night to Aa2 From Aa1 as banks continue to be under stress in that nation. The Euro currency is declining sharply lower this morning. The CurrencyShares Euro Trust(NYSE:FXE) is trading lower by 0.95 cents to $137.52 ahead of the opening bell at the New York Stock Exchange. Recently, Greek and Portuguese debt have become the focus of the problems in the Euro-zone and remain unsolved.
The U.S. Dollar Index is catching a bid higher today. The U.S. Dollar Index is trading higher by 0.46 cents to $77.18. It is important to note that since early June 2010 the U.S. Dollar Index has declined by 14.0 percent and is very oversold at this time. Therefore, the bounce in the U.S. Dollar Index could just be a bounce from an oversold technical position on the charts. As long as the Federal Reserve Bank continues to move forward with its quantitative easing program the U.S. Dollar Index could decline again after a small short term bounce.
Gold and silver are both declining early this morning. This move lower in the precious metals is likely caused by an overbought condition on the charts. The stronger U.S. Dollar Index is also putting pressure on gold and silver this morning.
WTI oil is trading lower today by $1.57 to $102.81 a barrel. Crude was very extended and overbought. Please use caution when it comes to oil as any increased violence in the Middle East or Saudi Arabia will cause oil to bounce right back up.