Equities and the Economy:

U.S equities began the quarter on a slightly sour note. The Dow fell 54 points to 18,253, the S&P 500 lost 7 ending at 2,161 and the Nasdaq closed down 11 at 5,301. It could have been worse. The Dow was down as much as 104 intraday. Let’s call it a flesh wound. Quite frankly folks, since mid-July the Dow hasn’t done much being range bound between about 18,000 and 18,500. So let’s turn to the economic news of the day. Good news came from the manufacturing sector with The Institute for Supply Management yesterday reporting its index of manufacturing activity rose from 49.4 to 51.5 in August which was 1) much higher than Wall Street’s expectations and 2) above the all-important 50 level indicating expansion. New orders jumped a big 6%. Not so good news came from the Commerce Department, which is what I believe weighed on the major indexes, stating construction spending fell 0.7% in August with economists looking for a 0.1% increase. Residential construction fell 0.3% while non-residential and government construction fell 0.4% and 0.2%, respectively.

This morning with both the Asian markets closing higher and the European markets are trading materially higher, U.S. stocks are being pulled higher with Dow futures up 51 points.

Oil

Oil prices continued their grind higher yesterday with WTI closing up 57¢ at $48.81 and Brent rising 79¢ settling at $50.89. WTI’s close yesterday was its highest in three months! Oil prices are still riding the wave of the OPEC announcement of limiting production. However, I believe this move up is mostly short covering. OPEC is talking a production freeze and if so they’ve got some work (and agreement!) to do. Per Bloomberg, OPEC production in September rose to a record high in September driven by returning output from Libya and Nigeria, both of which will be most likely exempted from any production freeze. OPEC production increased by 170,000 bpd from August reaching 33.75 million bpd. Iran is also increasing production and will also probably be exempt. Saudi Arabia and Russia will have some serious burden to carry. We’ll find out at the end out next month when they all meet in Vienna. Then the question will be whether they adhere to the agreement. This is premature, but I could see Saudi Arabia adhering. Russia; I trust them about as far as I can throw Putin.

Courtesy of MDA Information Systems LLC

Natural Gas

Natural gas closed up 1.7¢ yesterday at $2.923. Chatter. Natty prices were driven higher to near $3.10 driven by the cash market which was driven by power generation demand due to above normal temperatures and a lot of nuclear plant outages due to regularly scheduled maintenance. The weather is now cooling as we move further into autumn and those nukes are returning to service which is putting downward pressure on the cash market. The weather forecast is showing materially above normal temperatures for the next 2 weeks in most of the central and eastern portions of the country and while that would be bullish a couple of months ago, it’s neutral to bearish right now. All above normal temps in October do is bring some absolutely beautiful weather to the Midwest and east, and no-load conditions, in the magnitude of 40 Bcf less demand than normal. Natty remains on the defensive this morning being down 3.5¢

Elsewhere

We’ve all prepared and seen resumes. CareerBuilder conducted a survey of more than 2,000 hiring managers in the U.S. asking them what are some of the most memorable things they’ve seen on resumes.

An applicant listed smoking under hobbies.
An applicant’s name was auto-corrected from “Flin” to “Flintstone”. His name was Freddie.
An applicant stated they pay great attention to detail. “Attention” was misspelled.
An applicant claimed they worked for a federal prison. A background check revealed he was incarcerated at the time.
An applicant listed a skill as “taking long walks.”
An applicant used direct quotes from “Star Wars” in their resume.
An applicant claimed he would work harder if paid more.
An applicant wrote the following at the end of his resume: “I didn’t really fill this out, someone did it for me.”
An applicant used a resume template with cats in the corners.