Trading yesterday felt similar to days earlier in the year as oil/commodities fell, the dollar and treasuries rallied and the major indices declined anywhere between 0.5% and 1.6%, the result of speculation that the FOMC is moving closer to raising interest rates.
Trading was about 25% below average daily volume. As noted earlier trading for the first two days of this holiday shortened week is the slowest of the year.
Was yesterday of any significance? I don’ think so as many dynamics have changed including growth assumptions and the outlook for oil given the massive infrastructure cuts that have occurred. No markets ever move in a linear direction.
Today is expected to be another quiet day given many are leaving early for the three day weekend.
Last night the foreign markets were down. London was down 1.30%, Paris down 1.79% and Frankfurt down 1.35%. China was down 1.39%, Japan down 0.64%and Hang Sang down 1.31%.
The Dow should open moderately lower as oil is down about $1/barrel, partially the result of a raising dollar, a rise brought upon by yet another change in monetary policy assumptions. The 10-year is up 3/32 to yield 1.87%.
Chief Economic Strategist Managing Director
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