Tuesday, September 22, 2009
Crude drops for third straight day
Firm dollar takes its toll on crude
Crude prices ended lower for third straight day at Nymex on Monday, 21 September, 2009. Prices fell following dollar's gains. Prices fell despite comments in the market that current recession was easing gradually.
On Monday, crude-oil futures for light sweet crude for October delivery closed at $69.71/barrel (lower by $2.33 or 3.2%). Last week, crude ended higher by 4%.
For the month of August, 2009, crude ended higher by a marginal 0.7%. For the second quarter, crude ended higher by 40%. Crude prices had rallied 11.3% in the first quarter of 2009.
Oil prices had reached a high of $147 on 11 July, 2008 but have dropped almost 56.8% since then. Year to date, in 2009, crude prices are higher by 48.2%.
In the currency market on Monday, the dollar index, which measures the strength of dollar against a basket of other currencies, rose by 0.5%.
Federal Reserve starts its two day meet on monetary policy tomorrow. The FOMC will release on Wednesday a statement on monetary policy that may clarify how the central bank plans to unwind its quantitative easing programs.
Also on Monday, October reformulated gasoline gave up 8.1 cents, or 4.4%, to $1.7514 a gallon and October heating oil sank 7.62 cents, or 4.2%, to $1.7517 a gallon.
Also on Monday, October natural gas lost 20.2 cents, or 5.3%, to $3.576 per million British thermal units. Natural gas soared 28% last week, the biggest weekly gain in nearly three years.
Crude prices had ended FY 2008 lower by 54%, the largest yearly loss since trading began at Nymex.
Precious metals drop for third straight day
Gold and silver continue to drop as dollar surges
Precious metal prices ended lower for third straight day on Monday, 21 September, 2009. Prices fell as dollar firmed up ahead of Federal Reserve's two day meet starting tomorrow.
Generally, a stronger dollar pressures demand for dollar-denominated commodities, such as crude oil and gold, which become more expensive for holders of other currencies and also vice versa.
On Monday, gold for September delivery ended at $1003.7, lower by $5.5 (0.5%) an ounce on the New York Mercantile Exchange. During intra day trading, it fell to a low of $998. Last week, gold ended higher by 0.4%. Year to date, gold prices are higher by 15%.
Gold ended August, 2009 higher by 0.2%. Before this, for the second quarter, gold ended higher by 0.5%. The metal had gained 4.3% in the first quarter of this year.
On 17 March, 2008 prices had skyrocketed to a high of $1,034/ounce. But prices have dropped somewhat (2.8%) since then.
On Monday, Comex silver futures for December delivery fell 18.5 cents (1.1%) to $16.88 an ounce. Last week, silver ended higher by 2.2%.
Silver ended 7.1% higher for August, 2009. For second quarter, silver rose 4.5%. Year to date, silver has climbed 47.4% this year. For 2008, silver had lost 24%.
In the currency market on Monday, the dollar index, which measures the strength of dollar against a basket of other currencies, rose by 0.5%.
Federal Reserve starts its two day meet on monetary policy tomorrow. The FOMC will release on Wednesday a statement on monetary policy that may clarify how the central bank plans to unwind its quantitative easing programs.
In 2008, gold prices ended higher by 5.5%. The dollar index had gained 12% that year.
Inox Leisure
We recommend a buy in the stock of Inox Leisure from a short-term perspective. It is evident from the charts of the stock that following a medium-term correction between early June and mid July from Rs 71 to Rs 37, it found key support around Rs 40. Later, it resumed its intermediate-term uptrend that has been in place from March low of Rs 18.9. Since July, it has been on a medium-term uptrend too. Recently, the stock surpassed its 21-day moving average and is trading well above 21 and 50-day moving averages. On September 18, it breached its near-term resistance at Rs 55 by gaining 5 per cent with good volume. The daily relative strength index (RSI) has entered in to the bullish zone and weekly RSI is on the brink of entering this zone. The daily moving average convergence and divergence indicator has signalled a buy and is hovering in the positive region. We are bullish on the stock from a short-term horizon. We anticipate it to rally until it hits our price target of Rs 63. Traders with a short-term perspective can buy the stock while maintaining a stop-loss at Rs 54.
via BL
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