Friends

With tensions brewing once again in the Strait of Hormuz, the market averages moved lower during today’s trading session. Another headwind for stocks was the long bond moving above 4.50%, a level that had provided resistance for the bond market. It will be interesting to see how stocks react if bond yields move higher off that 4.50% level.

As for today, by the close the Dow Jones Industrial Average was down 130 points to finish the day at 52,925. The S&P 500 was down 33 points to close at 7,503. The Nasdaq Composite Index was down 302 points to close at 25,818. Gold was down $46 to trade at $4,120 per ounce, while oil was up $3.48 to trade at $72.03 per barrel WTI.

Higher oil prices and higher bond yields is not a good recipe for higher stock prices, so today’s weakness makes total sense. Again, earnings season will soon be upon us but for now the markets may be more inclined to react to macroeconomic developments. Let’s see if the bulls can keep this train on the tracks despite the obstacles ahead.

Have a nice evening everyone.

Jim