Dave Fry's Market Outlook for Wednesday

by: David Fry posted on: November 07, 2007 | about stocks: DBA / DBE / EWZ / FXI / GDX / GLD / IEF / IGM / IGN / INP / RSX / RYT / SPY / UDN / USO

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One headline reads, “Blame China if Oil Hits $100”. Given the US has had no domestic energy or proactive drilling policy for three decades while Chinese demand has grown, I suppose that’s “sort of” right.

But who cares today with oil pushing $100 when the DJIA is up 100 points? Not too many evidently.

Breadth was okay Tuesday, with advance decline rather narrow on the NASDAQ given the rise. The latter demonstrates the Big Cap nature of current conditions.

You must wonder at the low of shipping levels of crude oil tankers listed below. With futures markets in backwardation [back month prices lower than front months] there is a mystery here. Supplies are tight by all accounts yet there’s little being shipped.

Now to the troubled sectors:

And elsewhere:

Then a walk around the ‘ol BRIC yard once again.

Sure, I’m bugged at US politicians and their lack of promulgating an aggressive energy policy. Some thought me a Pollyanna a few months ago when I suggested we were facing a national energy emergency. Still? Politicians will start blaming big oil when they have only themselves to blame. The markets rallied smartly today and putting your finger on why is more difficult than usual.

So you know what? I won’t even try.

Disclaimer: Among other issues the ETF Digest maintains long or short positions in: SPY, USO, DBE, DBA, DBC, IEF, GLD, GDX, UDN, IGM, RYT, FDN, IGN, EWZ, RSX, INP, FXI and HSI.