FED PRES. ON INTEREST RATES
Investors are hoping to get a better handle on the direction of interest rates after St. Louis Fed president James Bullard spoke with CNBC. When asked about rising interest rates he said “it’s a little bit of the economy and a little bit due to fears of inflation,” says host Melissa Lee.
What does that mean for borrowing costs?
I don’t know if the rising yields in Treasurys are correct or not correct, muses Fast Money trader Joe Terranova. Personally, I don’t expect the government to raise rates in the face of a weak economy and struggling consumer.
I think it all boils down to the next Fed meeting on June 23rd and 24th, he adds. The question is – does Bernanke come in and buy more Treasuries?
COMMODITY STOCKS LEAD MARKET LOWER
Meanwhile, both the S&P 500 and Dow were trading lower after retreating commodity prices drove a sell-off in that space and after Goldman Sachs' downgraded Wal-Mart. Also, investors hammered technology shares.
"It seems to me what's going down the most is the stuff that's gone up the most. There's been enormous moves both in equities and in commodities recently," says Eric Kuby, chief investment officer at North Star Investment Management Corp in Chicago.