Weaker Dollar Lifts Commodities, However, Stocks Start Weak

This morning the S&P 500 e-mini futures(ES-U0) are trading lower 3.25 to $1072.75. This small decline lower comes despite a early rally higher in some leading commodities and commodity stocks. Often when the U.S. Dollar Index declines most leading commodities will inflate and trade higher. Oil, gold, and copper are all catching a bid higher before the opening bell in the New York Stock Exchange. Since 2007 the U.S. Dollar Index has been extremely important as the major stock market indexes have traded inverse to the dollar. Today the U.S. Dollar Index is lower by 0.48 cents to $82.40.

Spot gold is trading higher by $10.00 to $1227.10 and ounce on the back of stock market uncertainty and a weaker U.S. Dollar. Spot crude has sold off sharply all last week is now trading into some important short term support levels. Crude is trading slightly higher this morning by 0.12 cents to 75.51 a barrel. The leading copper stock is Freeport McMoRan Copper & Gold Inc (NYSE:FCX) and this stock is trading by 0.70 cents to $70.70.

It will be important to keep an eye on the U.S. Dollar throughout the trading day. When the dollar declines the major indexes and many commodity and inflationary stocks will usually inflate higher. However, if the U.S. Dollar Index trades higher it would be prudent to watch for further weakness in this market.

Nicholas Santiago

Chief Market Strategist

www.InTheMoneyStocks.com