Daily Futures Commentary COMMODITIES 021309

Friday, February 13, 2009

EQUITIES

Equity markets are trading better overnight and are expected to open better this morning. Late yesterday the stock indices reversed a huge sell-off to erase close to half of the week’s losses. Since early in the week the stock indices have been under pressure. Traders have been selling equities since the announcement of the U.S. banking rescue plan failed to spur investor demand because the new plan lacked clarity and conviction.

News that a new plan will focus on helping homeowners has provided a little more detail as to who the plan will target. This was enough to trigger short-covering. As more details are revealed, the market is likely to continue to regain its current loss for the week.

CURRENCIES

March Euros are trading weaker overnight. News that the European Union GDP declined by 1.5% is a strong indication that the European Central Bank will have to cut interest rates by as much as 50 basis points next month.

Rumor of a U.S. banking bailout plan is triggering a short-covering rally in …
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