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Markets Show Strength

Posted by Jim Sparrow on Wednesday, May 6th, 2009 at 4:01pm.

NYMEX Crude OilCrude oil futures closed above $56 per barrel Wednesday as inventory numbers indicated storage levels might be leveling off. NYMEX light sweet crude (June delivery contract) settled up $2.50 at $56.34 a barrel, while Brent crude finished $2.03 higher @ $56.15 / bbl. Today's closing price was the highest since November 14, 2008.

Natural gas futures also were up on the day, rising 27 cents (7.5%) to close at $3.88 per Million BTU. It was the largest single day gain for gas in nearly two months.

Meanwhile the Toronto stock market also rallied on the price of oil. The TSX composite rose 265.7 pts to finish the day @ 10,146.4, marking the first time since the beginning of November 2008 the market has closed above the 10,000 level. The Canadian dollar finished the day up 75 basis points at 85.78 cents US.

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3 Responses to "Markets Show Strength"

Marie wrote: @Jim -
Look at oil go today! Over $58/bbl now

Posted on Thursday, May 7th, 2009 at 8:01am.

Morgan Carey wrote: Jim what do you think raised oil prices will do to the Canadian vs US dollar? - I have noticed a trend that the dollar seems to go where the oil goes

Posted on Friday, May 8th, 2009 at 1:57am.

Jim Sparrow wrote: @Morgan - Even though Canadian oil is sold in US dollars, the impact of those sales on the US currency is insignificant *in terms of the much larger global picture*. Looking at it from the other side of the trade, there is a direct relationship between the price of oil AND the strength of the US dollar. Since barrels are sold in US $'s, as the value of the US currency drops, the commodity value increases. This also applies to Gold.

Posted on Friday, May 8th, 2009 at 10:58am.

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