We are watching the MAR14/JUN14 Natural gas spread, which has recently exploded. We believe this may be approaching overbought levels.
Most analysis—I believe correctly—targeted the September meeting as the start of the taper. But in between there were two extremely poor unemployment reports. Just after we had a government shutdown and a threat of default on our debt.
In the end we didn’t see a massive sell-off. Stocks didn’t tank and Treasury yields didn’t soar, … What the market viewed as near-armageddon just this past summer was welcomed with open arms and hands turned inward (metaphorically) indicated buying activity.
The European Union lost its top credit rating from Standard & Poor’s, which cited the deteriorating creditworthiness of the bloc’s 28 member nations.
The dollar strengthened to a five year high against the yen on optimism U.S. economic growth will outperform Japan’s next year.
Since the start of November, a confluence of cold temperatures, production setbacks, and infrastructure maintenance, has conspired to push natural gas prices to the highest level since last April for a front-month contract.
Wheat traded near a 19-month low in Chicago as an increased outlook for Argentine production of the grain adds to signs of record global supplies.
The U.S. economy expanded in the third quarter at a faster rate than previously estimated as consumers stepped up spending on services such as health care and companies invested more in software.
Although next week is a shortened trading week, traders still have a couple of housing reports to watch, as well as durable goods on Tuesday.