The relative weakness of today's stock index futures rally back from the abyss is purely from the further plunge in crude oil, not inherent strength from stocks or earnings reports. Even though the index has erased a 100-point Dow deficit, it is still just barely above break-even. This doesn't bode well for the strength of any continuation, if stocks can't gain a stronger foothold on crumbling crude prices. The drop in crude prices is largely due to collapsing crude oil consumption expectations. And if we get more gloomy forecasts and earnings estimates tonight, that big drop in crude oil prices will have been mostly wasted, as stocks are likely to plunge again this evening. And if stocks lead an economic rebound, then what? Won't crude oil demand surge higher again, thus reigniting crude oil and other commodity prices, and with them, inflation expectations?
Several food manufacturers, including Kraft and Sara Lee, in the past few days have announced that they will push through higher prices within the next few months, due to higher commodity prices and other input costs. How much of a price increase? They say about 20%. That's a hefty increase! That doesn't help the inflation picture at all!
Several food manufacturers, including Kraft and Sara Lee, in the past few days have announced that they will push through higher prices within the next few months, due to higher commodity prices and other input costs. How much of a price increase? They say about 20%. That's a hefty increase! That doesn't help the inflation picture at all!
