With all of the hot air floating around Washington, D.C., we saw natural gas drop from $3.800 MMBtu in mid-September to test the waters below $3.500 for one day, Sept. 26. Last week November natural gas opened at $3.755 and closed the week at $3.589.
Sugar prices are in a free fall now at prices we have not seen since July 2010. A major reason for last week’s drop was that it was reported the output nearly tripled in April at the main growing area of Brazil.
Last week the Dec. E-mini S&P 500 opened at 1767.00 and closed the week making new highs along the way at 1793.50. No close yet above 1800. Now I agree that PE ratios do look goods, so why does it seem that tapering talk spooks the market, or does it?
In the May WASDE global ending stocks are projected to be at 186.4 million tons, up 6.2 million tons from last year. The 51.2 million ton increase in foreign production will more than offset the lower forecast production in the U.S.
This past Thanksgiving trading week, the December 2013 E-mini S&P 500 opened at 1802 and closed at 1804. We could be seeing an early month correction along with end of the year profit-taking. December is the second best month for equity returns averaging an estimated 1.5%.
The Federal Reserve knows how a weaker U.S. dollar helps U.S. exports. Any threat to U.S. exports — a strengthening U.S. dollar — could hurt exports, in turn hurting the U.S. economy, which could hurt jobs.