StockTwits Market Preview 7/6/09

• kileyay
• July 6th, 2009

Overseas

Futures flew lower on declines in key commodities and turbulence overseas.

Indian stocks were slammed after Finance Minister Mukherjee said they’d be upping the credit line on the national Visa. The record stimulus should stretch the country’s fiscal deficit to a wider-than-expected 6.8% of GDP.

Markets were mixed in the Orient. Japan’s Nikkei 225 slid 1.4%, while Hong Kong’s Hang Seng shed 1.2%. China shined –Shanghai’s Composite advanced 1.2% for its fourth straight winning session.

European markets are down, with commodity-centric shares dragging. London’s FTSE 100, Frankfurt’s DAX, and Paris’ CAC-40 are each off more than 1%.

Commodity Correction

Sharp swoons in commodity prices are inflicting losses on oil, mining, and shipping stocks worldwide. Continued corrections in key commodities are fueling worries that a robust recovery remains a pipe dream.

Nigerian thugs bragged Sunday of an attack on a Royal Dutch Shell ($RDS.A) facility – a crude attempt to disrupt the output of Africa’s largest oil producer. Shares of Shell’s ADR are selling off pre-market.

WTI crude is trading around $64 a barrel, a bargain-basement price next to the $73 one might have paid last week. Precious metals are all down. Gold is hovering around $922 an ounce.

Fundamentals & Forex

Fundamentals are thin today, with little on the economic or corporate calendars.

Officials from the Group of Eight countries will convene in Italy on Wednesday. Look for loose-lipped leaders to roil currency markets.

Overnight, the dollar stuck to narrow ranges against major counterparts — losing ground to the yen but edging higher against the euro. Squeamish speculators squared positions ahead of the G8 meeting.

Russian Spies

PepsiCo ($PEP) said it will invest $1 billion in Russia over three years. Pepsi stock has been strong recently, but it looks to gap lower today.

Goldman Sachs ($GS) is subject of a brouhaha involving a Russian spy and a top-secret quant code. Shares are lower in early trade.

Bears & Bulls

A bevy of bears is buying up protection against a 10 percent decline in the S&P. Traders are paying more on bearish bets than at any time since Lehman croaked last fall, says Bloomberg.

The StockTwits community agrees. 28% predict a breakdown this week, according to our weekly Bull Bear Survey:

The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.

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