Stocks are up in early trading today, which means this could be the fifth straight daily gain for Wall Street. There are a few important news items today. One is that the Saudi Oil Minister said that oil needs to be between $60 and $75 a barrel in order to bring new oil resources to the market. I think he’s right. As long as oil is cheap, few people are going to bother with more expensive alternatives. I continue to believe that oil along with many other commodities is poised to climb a lot higher. That’s why our strategy is to focus on commodity stocks.
The other part of the equation involves the weak dollar and it’s trading lower again today. The most recent report on industrial production showed that it fell for the fourth straight month. Over the last 12 months, industrial production is down by 11.2% which is the biggest drop in over 30 years. The euro is now back over $1.30 for the first time in three weeks.