Daily Futures Commentary November 9, 2009

Monday, November 9, 2009

Demand for higher risk assets is helping to trigger a strong rally in U.S. stock markets. Although the markets are still below their highs for the year, appetite for risk is expected to continue for some time which gives the indices plenty of time to attack the major highs. The action by the Fed last week combined with bearish unemployment report is expected to keep pressure on interest rates which is helping investors build confidence in the long side of the market.

Interest rate futures are under pressure this morning. Increased supply from this week’s Treasury auction is helping to attract selling pressure. The stronger stock market is encouraging treasury traders to shift money into higher yielding assets.

The U.S. Dollar is getting trounced overnight after the G-20 finance ministers failed to discuss the value of the Dollar, thereby effectively offering no support. In addition, they decided to keep stimulus measures in place until the global economy can show sustained gains.

The real selling pressure hit the Dollar after an IMF report issued at the meeting said, …
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