Financial Markets Summary
Thursday, March 9, 2017
- Oil dropped below the trading range low for 2017, which had been near $50.75-51.00 a barrel. The price reached a low yesterday at $50.06 before bouncing a bit and closing near $50.30 a barrel. The $50.06 low was the lowest oil has been since the middle of December.
- The decline in oil seems to be in reaction to a large inventory build and questions about how successful the OPEC oil production cuts have really been or will be. Current support resides near $48.75 a barrel. For those bullish on oil, holding support becomes quite important as a further decline reverses the short term up trend. The intermediate and long term trends are down.
- The stock market as represented by the S&P 500 has dropped four of the past five days since last Wednesday’s surge higher. The pullback from intraday high to intraday low has only been 1.70% or quite mild as buyers have been quick to step up as soon as selling takes place.
- The Russell 2000, which is representative of the small capitalization universe, has been the lagging index during 2017’s rally. The index has been in a long sideways consolidation since early December. A return to strength for this index would be a huge positive for the stock market.
- Gold extended its losing streak to seven consecutive days after hitting resistance. Gold closed yesterday near $1208 an ounce.
Sources: bankrate.com, bloomberg.com, briefing.com, Dow Jones News, Financial Times, finviz.com, Investor's Business Daily, marketwatch.com, seekingalpha.com, Thomson Reuters/First Call, U.S. Dept of Treasury, yahoo.com and individual company web sites and press releases.
Leonetti & Associates, LLC views or opinions are as of a certain date and subject to change without notice. The material contained herein is for informational purposes only and obtained from sources we consider reliable. We make no guarantee as to its accuracy or completeness. References to specific securities and industries/sectors should not be considered recommendations to buy or sell any security or advisory service. Past performance is not a guarantee of future results.