can any of the regular econo-poster offer any sense to this?
The economists and financial/trading wizards need to be replaced by the psycho-analysts.
We sold lots of 10 year debt to foreigners today!
Markets rally!
Except for new cars, consumers bought nearly nothing last month!
We sold minimal 5 year debt to foreigners Wednesday!
Oil hits $66 a barrel!
Gold goes higher!
Dollar weakens on bad retail data!
Interest rates raised 10th time in 1 year - more to come!
Stocks Catch an Afternoon Wave
Bond Auction Goes Well,
Relieving Worried Traders;
Oil Touches $66 a Barrel
August 11, 2005 4:48 p.m.
The market Thursday was a mirror image of Wednesday.
Stocks rallied in afternoon trading shortly after a Treasury bond auction for 10-year notes drew strong interest from foreign buyers. Wednesday, stocks declined after an auction of five-year notes attracted the second-lowest level of overseas buyers since the Treasury Department started monitoring foreign-interest in mid-2003.
The Dow Jones Industrial Average rose 91.48 points to 10685.89. Shares of McDonalds paced the Dow, surging 6.1%. The Standard & Poor's 500-stock index gained 8.65 to 1237.83 and the Nasdaq Composite Index added 16.74 points to 2174.55.
Traders were worried that China may cool its purchases of greenbacks as it values the yuan against a basket of currencies, rather than just the dollar, and recent light foreign interest had been fanning the flames on those concerns. Thursday's auction put those worries on the back burner, however, and bonds rallied, lowering their yields, which move inversely to prices.
"All of the fears were placated by the success of the auction," said Steven Shobin, chief investment strategist at AmeriCap Advisors.
Earlier, stocks struggled after a gush in oil prices. Light, sweet crude oil gained 90 cents to $65.80 a barrel on the New York Mercantile Exchange after briefly touching $66 a barrel, another in a string of nominal daily records.
"Oil up at these levels is having a psychological effect on the market," said Brian Williamson, an equity trader at Boston Company Asset Management.
Gold soared $9 a troy ounce to $447.90, helped by a weakening dollar, which declined against the euro and yen after a report showed weaker-than-expected retail sales in July.
Investors also dealt with a report showing retail sales were lower than expected in July -- propped up by auto makers and their significant discounts -- and another showing business inventories were flat in June as the surging auto sales cut into companies' stockpiles of goods. Initial jobless claims, meanwhile, fell last week.