Good morning. A second straight lousy day for our 401K’s. The Dow lost 98 points, its biggest one day drop in a month, to 17,014, the S&P 500 fell 13 and back below 2,000 to 1,988 and the Nasdaq really got whacked closing down 40 points, 0.9%, to 4,552. Investors had little economic news to go on so trading was largely dominated by the news out of Apple and its latest batch of product announcements including an updated version of its iPhone, a smart watch and something that would appeal to me, a cell phone payment system eliminating the need to swipe a credit card. Now this type of payment system has been around for a while (I use at Starbucks via their app and it is awesome) but the behemoth credit card companies (that would be the big banks) have been slow to adapt the technology. Apparently the security is better than using a credit card which would reduce hacking and stealing credit card numbers which is exactly what Home Depot stated happened to them which also weighed on stocks yesterday. This comes after Target announced nearly a year ago they’d been hacked. If I was the VP of IT at a major retailer I wouldn’t be sleeping well right now.

This morning equities around the globe are waffling on either side of unchanged. The Asian markets closed mixed but Hong Kong’s Hang Seng got crushed closing down 1.93%. Here in the U.S. Dow futures are bouncing around like a die in a Yahtzee cup being up 5 currently.

Oil stopped falling, well at least WTI did closing up 9¢ at $92.75. Brent though got bludgeoned losing $1.09 closing at $99.16 and trading at a 16 month low on reports that Libyan oil production has risen yet again. After having been stopped entirely in early August because of inter-tribal fighting across the country, crude oil production was res-started mid-month last month and has reportedly risen to 500,000 bpd rapidly. However, yesterday a “spokesman” for the Libyan national crude oil company (you have to careful with the term “spokesman” for one never has complete confidence on who speaks for Libya) that production is approaching 750,000 bpd. Add to this the high and rising supplies of Kurdish crude via the pipeline across Iraq to the Turkish port of Ceyhan and that global demand is flat at best, one can conclude the world is currently amply supplied with oil with traders bidding for storage. This morning WTI is “slipping” being down 56¢.

After rallying 8¢ on Monday natural gas tacked on another 10.8¢ yesterday closing at $3.984. Although not closing above $4.00, yesterday was the third time in the last month that natty traded over that number. Demand for natty in the short term will increase materially in the Midwest over the next few days as heaters kick on (already! can you believe it?) and there was a capacity auction in the New England ISO (grid) yesterday and companies may have been buying gas to hedge those sales.

Do you know what the significance of today’s date is? Well, it’s the statistical peak of the hurricane season, which has been virtually non-existent to date. There is an area of low pressure 600 miles west-southwest of the Cape Verde Islands (a long way from the States!) with a 20% of development in the short term and 70% chance in the longer term as it moves east across the Atlantic so let’s keep an eye on it. This morning natty is down 3.2¢ with traders getting ready for tomorrow’s EIA storage report.

Oil producers continue to find ways around the lack of pipeline (Keystone XL) to move their product, and its via rail. Per our EIA, the amount of crude oil and refined petroleum products moved by U.S. railroads increased 9% during the first 7 months this year compared to 2013. In July 16,000 carloads per week moved. A lot of the crude is being moved out of the Bakken Shale in North Dakota, now the 2nd largest oil producing state, as pipeline infrastructure has lagged production with the formation now providing nearly one out of every eight barrels of oil produced in the U.S. To increase safety, railroads have voluntarily increased inspections and reduced speeds. Additionally, the U.S. Department or Transportation is proposing rules that new oil tank cars constructed after October 2015 have thicker steel as well as requiring retrofitting of existing tank cars. Have a good day.