Posted on Tuesday, 5th July 2011 by Charlotte W
– The major U.S. index futures are pointing to a mixed opening on Tuesday, with sentiment reflecting caution following advances in each of the five sessions of the past week. The nervousness may be accentuated by the impending release of the non-farm payrolls report due on Friday. Fears that China may announce additional tightening measures may also weigh on the markets. That said, factory goods orders report to be released after the markets open may have very little impact on the markets. Meanwhile, commodities are seen firming up.
U.S. stocks rallied throughout the week ended July 1st, ending notably higher, as the mitigation of concerns about Greek defaulting and the release of a few surprisingly strong manufacturing readings contributed to a strong rebound.
Last Monday, the major averages advanced strongly due to the positive sentiment generated by a plan offered by French banks to roll over some Greek debt for 30 years. Optimism that the Greek parliament would approve the austerity bill and solid earnings from footwear and apparel maker Nike (NKE) helped the markets end higher on Tuesday.
With the Greek government passing the austerity bill on Wednesday, much of the overhang around Greece was removed. Consequently, the major averages extended their gains on the day. A positive housing report offered additional support. A positive regional manufacturing survey helped the markets end higher on Thursday. The major averages advanced yet again on Friday, thanks to the surprising strong manufacturing reading of the Institute for Supply Management’s national survey and solid sales reported by automakers.
For the week, the Dow Industrials added 5.43 percent and the S&P 500 Index rose 5.62 percent, while the Nasdaq Composite Index gained 6.15 percent.
Among the sector indexes, the Philadelphia Oil Service Index rose 8.42 percent for the week compared to a 7.36 percent advance by the NYSE Arca Oil Index. The Dow Jones Transportation Average, the KBW Bank Index and the Philadelphia Semiconductor Index all rose over 6 percent. Additionally, the NYSE Arca Securities Broker/Dealer Index and the S&P Retail Index added over 5 percent each.
Currency, Commodity Markets
Crude oil futures are currently rising $1.07 to $96.01 a barrel after advancing $3.78 or 4.15 percent to $94.94 a barrel in the week ended July 1st. Despite a recent decision by the International Energy Agency to release oil from the strategic reserve, the price of oil rebounded in the previous week, primarily due to the dollar’s weakness.
Gold futures, which fell $18.30 or 1.22 percent to $1,482.60 in the previous week, are currently rising $26.90 to $1,509.50 an ounce.
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