Where is the Dow & others heading in 2005?

Racer said:
At least 15 refineries in Texas and Louisiana, accounting for about 24 percent of U.S. capacity, shut as Rita approached. Valero Energy Corp. said its Houston and Texas City plants may restore processing within seven days. Another 5 percent of the nation's refining capacity remains closed from Katrina, with four plants scheduled to resume output in November or December.

http://quote.bloomberg.com/apps/news?pid=10000006&sid=aZ7H15xL19OI&refer=home
Click to expand...
Oil down almost 2%, to $63, on Nymex today.
 
OFFICE OF ELECTRICITY DELIVERY AND ENERGY RELIABILITY (OE)
U.S. DEPARTMENT OF ENERGY
Gulf Coast Hurricanes1 Situation Report #2
September 25, 2005 (3:00 PM EDT)

I picked up the report above on another BB.

Relief rally for the dow or more bearish result ? Futures seem to indicate a relief rally.

Refinery closures will reduce demand for crude in the short term. The price of WTI crude is sitting at the 50 dma - a possible test of the 200 dma could see a big rally in the indices.

Any thoughts ?
 
Last edited:
Short squeeze and stops triggered in overnight thin trading.
Oil going up today, so the real indicator will be a follow through in proper trading, not this out of hours rubbish
 
Racer said:
Short squeeze and stops triggered in overnight thin trading.
Oil going up today, so the real indicator will be a follow through in proper trading, not this out of hours rubbish
Click to expand...


Oil may have been going up today but it is still down 26c ($63.94) on the day. It has fallen from $68 last week, so I think the market will view this as a positive.

There is no data out today, so the "short squeeze" could be quite a squeeze. I think some traders will be taking profits on oil and gold and covering shorts in the Dow/S&P.

Any consumer confidence data later in the week is likely to be poor.
 
Thoughts only
Damage compared to RITA negiable A(Apparently)
Market appears to have taken effect as good news
Oil gone down but only slightly
Reports so far from rigs /refineries only superficial
Thr real damage caused by Ivan only became apparent after 2 weeks
Market discounting any bad news to come
Pre Rita there was no slack in refinery capacity
As reports filter in if their is further disruption to oil supply via undersea pipelines(2 weeks assessment) or difficulties at refinery the market SHOULD adjust upwards
As i understand it still loss of 5% refining capacity as result of Katrina should the Good news be that Rita has caused similar drop it is very hard to see how the loss can be made up
If damage caused to undersea pipelines repair could take up to 6 months however it is difficult to see how this can be achieved as resources are being directed toward Katrina
The market imo is adopting positive view of Rita purely on Compassionate grounds compared to Katrina
All of this has to balanced against the possibility of another Big H before the nov end of H season
Bi partisan lobbies are forming in Washington to cut large parts of the budget to pay for K and R
If the deficit is capped or cut the perceived impetus to GDP will not materialise
Politics is raising its head and may yet have an impact on the markets direction
Q for anyone,when does greenspan hand over the reins? It was only a month into his term as Fed Head when he had to deal with stock market crash of 87.Will he end as he began or will his succesor have to face a similar crisis
Joules has presented a savagely bearish technical theory on trading SPX with 26 october the crucial date.He may well be assisted by events over the next month
 
Racer said:
I think it is possible that oil could continue to go up today
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I think that the market factored in a class 4 or 5 hurricane, so clearly the damage to refineries has been less than might have been. I also think with the EIA and Government using reserves to make good any shortfall the pressure is off oil prices at the moment. In fact you almost feel that there is some sort of concerted effort by governments to get the price of oil down.

On the other hand we have the EIA and API figures out on wednesday, who knows what they will throw up? Realistically, I can't see oil getting below $57-58 easily.
 
macbonzo said:
I think that the market factored in a class 4 or 5 hurricane, so clearly the damage to refineries has been less than might have been. I also think with the EIA and Government using reserves to make good any shortfall the pressure is off oil prices at the moment. In fact you almost feel that there is some sort of concerted effort by governments to get the price of oil down.

On the other hand we have the EIA and API figures out on wednesday, who knows what they will throw up? Realistically, I can't see oil getting below $57-58 easily.
Click to expand...

Yes it worried about a much stronger hurricane, but.. oil was open for trading yesterday. Today the price is recovering, if it is doing that, then it will go higher, they had the opportunity to sell it a lot yesterday and continue today... they aren't.

And oil is an excuse for the markets going down last week, not a reason.
 
It should open UP at least 40 points and go a bit higher in the first hours before stalling imho
 
Racer said:
Yes it worried about a much stronger hurricane, but.. oil was open for trading yesterday. Today the price is recovering, if it is doing that, then it will go higher, they had the opportunity to sell it a lot yesterday and continue today... they aren't.

And oil is an excuse for the markets going down last week, not a reason.
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Yes your right, it seemed to be the FOMC decision and more crucially, it's wording on Tuesday that knocked the market most last week. It certainly surprised me. I'm not sure what the market was expecting (clearly a future pause in interest rates) but it is quite evident that stagflation could soon be a problem. My guess is that Q3 results may be OK but forward guidance could be a different matter.

Oil and Rita were only relevant towards the end of the week.
 
macbonzo said:
Yes your right, it seemed to be the FOMC decision and more crucially, it's wording on Tuesday that knocked the market most last week. It certainly surprised me. I'm not sure what the market was expecting (clearly a future pause in interest rates) but it is quite evident that stagflation could soon be a problem. My guess is that Q3 results may be OK but forward guidance could be a different matter.

Oil and Rita were only relevant towards the end of the week.
Click to expand...

So the fact that the damage wasn't so bad means that the fed has less reason to pause. Today will be interesting, will they sell into this, after an initial spike up?

How rosy are those bull specs? 🙄

One thing worth noting.. the FTSE 250 is hardly on fire today... it has struggled to get as high as +16 at 7884
 
Racer said:
So the fact that the damage wasn't so bad means that the fed has less reason to pause. Today will be interesting, will they sell into this, after an initial spike up?

How rosy are those bull specs? 🙄

One thing worth noting.. the FTSE 250 is hardly on fire today... it has struggled to get as high as +16 at 7884
Click to expand...


Boeing up 2.6% pm. However futures quite a bit off their high. To be honest if Dow can't finish up 75+, today, I would consider this market to be very weak. There is only positive news out at the moment.
 
All positive news? Greenspans comments on Saturday far from positive, just the market seeing things only as positive 😉
 
Do I need some coffee, or does this seem to be a rather choppy session on the Dow? It seems to me as if there is more volatility than usual for this time of day.
 
XOM up 0.6% hmm, that's a bit odd..
oil no prob after the hurricane, well that's what they say... and oil going down....

😱
 
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