Monday, June 15, 2009
Futures Drop - Reason
Futures on the S&P 500 expiring in September decreased 1 percent to 931 at 8:44 a.m. New York time, after the benchmark index climbed 40 percent from a 12-year low March 9. Dow Jones Industrial Average futures lost 1.1 percent to 8,643 and Nasdaq- 100 Index futures fell 0.8 percent to 1,473.5. Stocks also retreated in Europe and Asia.
“There is general concern that the three-month rally in equities means that stock prices have got ahead of reality,” said David Morrison, a London-based market strategist at GFT. “Oil and metals are sharply lower this morning and there is a growing realization that China is not yet ready to drag the global economy out of recession.”
In G8 meeting over the weekend - Finance Minister Alexei Kudrin reportedly said Russia has confidence in the U.S. currency. Upbeat dollar comments deflated commodity prices, hitting markets across Europe and Asia. Crude-oil futures fell 70 cents a barrel and silver and platinum futures fell.
The Empire state index fell to negative 9.4 in June from negative 4.6 in May, indicating the downturn broadened to more firms. Readings under zero indicate more firms said business was worsening than said it was improving.
CNN Money Reports
U.S. stocks were set to fall sharply Monday as a stronger dollar took momentum out of the commodities rally.