Today saw yet another day of frustration in the equity market as the Dow Jones Industrial Average suffered its worst week in roughly a year. The day also saw Barack Obama issue a statement urging Congress to set aside their differences and to pass a bill in order to prevent a catastrophic default from hitting bond markets around the world. However, this plea did little to help boost investor confidence as the S&P 500 finished below 1,300 points to close Friday trading. With just days left before we reach our the final debt ceiling deadline, rumors of a U.S. downgrade have been circulating, and seem to be gaining momentum as the days go on. No matter what decision is made in Congress, it will have a significant impact on our economy, and investors can only wait in limbo until something is put into place.
Thursday started off as the first solid day of the week, but as the trading session progressed with little to no information on the U.S. debt deal, major equities gave back their gains to finish yet another day in the red. As we draw ever closer to the August 2nd deadline, many analysts have begun to worry that both sides are deadlocked, and with a Republican House and a Democratic Senate, that will make it next to impossible to pass any legislation unless one side gives way to the other. While it seems highly unlikely that the U.S. will default on its debts, it is still a possibility at this point in time, a situation that could put the already beleaguered economy into an even bigger hole.
Today saw most equities take another major hit today, as the government seems no closer to a debt deal than it was yesterday. While markets seemed to be somewhat resilient to the rather urgent situation, today saw them finally break, lead by the NASDAQ which lost a shattering 2.7% on the day. The S&P 500 lost nearly 2% and the Dow dropped just under 200 points to cap off one of the worst trading sessions in recent memory. One brand new company weathered the storm though, as Dunkin’ Donuts’ IPO shot up 40%, leaving their stock as a diamond in the rough for the day. As for commodities, today has gone in the opposite direction of yesterday’s strong gains, as numerous commodities sank amid fears and a major economic crisis and a rebound in the greenback against most major world currencies.
Today truly proved to many investors why commodities are such an important aspect of any portfolio; major equities struggled due to yet another day without a debt deal, while nearly every major commodity finished up on the day. Though the strong commodity performance was partly due to a struggling dollar, a number of other factors converged to give some futures an especially robust day as far as performance is concerned. While gold put in a positive day, oil finished relatively flat, while the UBS Bloomberg CMCI index gained a healthy 15.7 points in today’s session. Though many commodity indexes are down from their April highs, the past few weeks have slowly formed an upward trend, giving investors hope for a strong future performance.
Today saw another busy trading day, with most major equities finishing down on continued worries that Congress will not agree on a debt plan in time. The deadline to raise the debt ceiling is set for August 2nd, leaving little time for major snags or debates among our legislators. Aside from these fears, the market saw Apple (AAPL) shares touch $400 for the first time ever, much to the delight of the wealth of investors with shares in the company. Today also saw the busiest week for IPO pricing since 2007, with industries represented everywhere from “food services, biotech, energy, and defense to even farming in Uruguay” writes CNBC.
Today saw equities finish mixed as the Senate rejected a House GOP plan to cut the budget and pass an increase to the debt ceiling. Though this was an expected move, it certainly did not help markets, as investors continually wait for the government to make tangible progress on the debt crisis before the looming deadline. Friday’s trading session also saw oil touch the $100 per barrel mark before finishing just under the triple digit level, likely boosted by strong earnings reports. Likewise, gold had a solid day, finishing above the $1,600 per ounce mark on continued uncertainty over debt. The majority of commodities saw a strong day as well; over five separate futures contracts posted gains of 1% or more. But among all of the winners and losers on the day, two stood out in particular, due to various supply reports from across the globe.
Equities surged forward today as solid earnings reports from a number of key firms helped to boost sentiment. Phillip Morris International rose by nearly 5% on a solid outlook while Union Pacific gained a similar amount on price increases as well. To top things off, Morgan Stanley showed a robust increase in trading revenues which helped to carry the financial sector higher overall and sent MS soaring by over 11%. Also helping markets in their 1%+ gains were actions to help Greece through yet another round of its debt crisis. While not all information has been released, initial reports from Brussels suggest that Greece will receive a bailout valued at 109 billion euro, alleviating fears that the nation would default altogether. Commodities saw an interesting day as well, as crude oil is again flirting with the $100 per barrel mark while other products took a hit during the trading session … See the full story here
Crude oil: America’s addiction. Since the introduction of the automobile, America has become incredibly dependent on fossil fuels to power our various transportation services. We use gasoline to operate our cars, airplanes, and even machinery that make our everyday lives possible. While we are the third largest producers of crude as a nation, we are by far the largest consumers; more than doubling the usage of the second-placed China, as we burn through more than 18 million barrels on a daily basis. But as we have continued our dependence on oil, consumers seemingly have taken the brunt of the blow when it comes to gas prices at the pump. Though we complain about the average cost of a gallon here, our prices do not come close to some of those abroad, so why the discrepancy?
Today saw major equities finish slightly down, which is to be expected after posting their largest gains in a year yesterday. American government officials continue to debate over a debt ceiling deal, although many are now predicting that the latest plan will need to be revised before it can pass through the Senate. While investors hope for a deal to be struck soon, only time will tell how long it will take for Congress to approve the legislation that will dictate how our nation moves forward with the current debt levels. As a result of this focus on debt, many commodities saw a relatively slow day, as the UBS Bloomberg CMCI index gave up just 1.9 points while the S&P GSCI finished up by about seven points in total.
Markets saw a healthy rebound today as earnings season helped to lift equities from their dismal spin that has been in effect for the last few trading sessions. After gold made yet another historic run yesterday, it fell back below the $1,600 per ounce mark as investors gained some optimism on the U.S. plan to handle the enormous debt and the ceiling which we have just hit. Oil, on the other hand, made strong gains on the day, as it turned a gain of over 1.6% moving nicely along with equities. As for major commodity indexes, the UBS Bloomberg CMCI Index gained 14.5 points while the S&P GSCI saw a drop of about 6.3 points. While the strong economic indicators were good news for a handful of futures, it put downward pressure on others that are more closely aligned with safe haven appeal, as the risky commodities saw inflows at their expense … See the full story here