This morning, all of the leading commodity stocks are coming under sharp selling pressure. The catalyst for the decline in the commodity sectors and the major stock market indexes is the stronger U.S. Dollar. Today, the U.S. Dollar Index futures (DX Z1) are trading higher by 0.40 cents to $78.95 per contract. To make a long story short, when the dollar rallies higher the major stock and commodity sectors will deflate and trade lower. Every trade is essentially a trade on the U.S. Dollar at this time.
Some of the leading commodity stocks that are declining today include Freeport McMoRan Copper & Gold Inc (NYSE:FCX), Rio Tinto PLC (NYSE:RIO), and BHP Billiton LTD (NYSE:BHP). These stocks will usually catch an intra-day bounce when the U.S. Dollar Index pulls back. If the U.S. Dollar Index continues to climb and trade higher it would be prudent to expect these commodity stocks to continue to fall.
Nicholas Santiago
InTheMoneyStocks.com
