Friends
Stocks decided to give back some of this week’s gains today as the Dow Jones Industrial Average finished the day down 179 points to finish just above 11,000 at 11,010. The S&P 500 was down 24 points to close at 1151. Commodities were all down as the dollar strengthened with Gold leading the way, down over $40 to trade near $1600 per ounce. Oil also suffered as WTI was down $3.78 to trade just about $80 at the close.
The trade was really based on a strong dollar day which led to selling in stocks and commodities. We had seen the falling dollar provide fuel for the rise in commodities and stocks earlier in the year, and as the dollar has strengthened in recent weeks, the commodity trade has really unwound and stocks have been under a lot of pressure. Now, a strengthening dollar is good for the average American as it helps to reduce the prices of things that we pay for every day, like food and gasoline, but the stock market has been a “risk on” or “risk off” proposition on a daily basis, mainly driven by the direction of the dollar, which basically has fallen for more than two years.
Nothing earth shattering from overseas today, other than news that the slowing in China may be accelerating. We will get a German vote tomorrow, which should provide some of the fuel for the market’s direction. We’ll see what tomorrow has in store and let you know if anything important transpires.
Have a nice evening everyone.
