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Thursday, September 28, 2006

Markets to Watch Today

Crude Oil: November Crude Oil rose to nearly $63 a barrel on Wednesday, as traders reacted to fears that OPEC may cut production. The expectations of the OPEC output cut outweighed news of rising U.S. inventories. U.S. gasoline inventories rose by 6.3 million barrels last week, far exceeding expert estimates. This data led to an early low of $60.10 a barrel, before OPEC fears took control of the trading action. Despite today’s gains, Crude Oil remains well below its July high of $78.40. November Crude Oil futures gained 3% or $1.95, to settle at $62.96 a barrel.

Natural Gas: Natural Gas futures fell to their lowest level in nearly four years on Wednesday. The recent declines are attributed to record supply levels, with little demand. As supplies remain high from last year’s mild winter, the mild hurricane season has eased any possible fears of an interruption to future supply. October Natural Gas futures fell 32.5 cents, to settle at $4.201 per 1,000 cubic feet.

Gold: Gold futures rallied on Wednesday, rising back above the psychologically important $600 mark for the first time in two weeks. Today’s gains mark the sixth consecutive day Gold futures closed higher, rebounding from its recent bear market. Firming Crude Oil prices, coupled with strong overseas demand continue to provide strength to the contract. Crude Oil’s gains were enough to override strength in the U.S. Dollar, as Gold continues to attach itself to movement in the energy sector. Also contributing to the buying effort is the recent conclusion of European central bank sales on Tuesday. December Gold futures closed the day with gains of $6.20, to settle at $603.30 a troy ounce.