As we kick off this Wednesday
morning, the same story exists that has existed for the past several months –
as oil prices go, so go the markets. Have you heard that one before? A search
for headlines and other economic drivers this morning has come up short again
and the oil story continues to be the driver. This morning, crude oil is down
almost 3.5% following a report from the American Petroleum Institute that was
bearish and a statement from Saudi Arabia’s oil minister that a production cut
isn’t happening. This is the second day of bearish oil news and the markets are
following oil to the negative. It played a part in yesterday’s sell-off as the
Dow was off nearly 1.5% and the S&P500 was down 1.4% nearly erasing Monday’s
gains. Today, we are seeing the same trend with both of the major indices
showing all red in early trading. Unfortunately, it’s a light day on the
economic reporting front to distract investors. A report on new home sales hasn’t
provided much for investors to sink their teeth into. Sales of new homes
plummeted 9.2% to a seasonally adjusted annual rate of 494,000 in January.
January’s figure was the lowest since October and missed forecasts of a 520,000
annual rate. This poor report won’t turn the tide on what we are seeing today
and in fact may add to the negative sentiment.
No comments:
Post a Comment