SubscribeDaily Futures Commentary May 26, 2009
Tuesday, May 26, 2009
The tone of the markets is negative this morning as geopolitical events dominate the news. The major geopolitical events helping to drive equity and commodity markets lower are the North Korean underground nuclear bomb and missile tests. These events have been condemned worldwide and are the major focus of a United Nations emergency meeting. Greater trade sanctions on North Korea are expected. In a lesser event compared to nuclear tests, OPEC is meeting. Traders are reacting to the news that OPEC may leave production cuts unchanged despite the global recession.
Equity markets are called lower this morning as nervous investors are pulling money from equities because of geopolitical issues regarding North Korea and OPEC. Traders are more risk averse this morning and seeking shelter in lower yielding assets such as the Yen and U.S. Dollar. The global sell-off began in Japan which faces the greatest threat from North Korea. Investor uncertainty is expected to exist until the market receives direction from a new United Nation resolution condemning North Korea or until prices hit a level attractive to investors.
Despite closing flat to slightly better last week, stock indices …
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