Market Snapshot: June 20

Market Snapshot:
Fed will meet next Tuesday for a 2 day meeting. The rate decision is expected on Wednesday. The market consensus is that the Fed will leave the rate unchanged after cutting the rate 7 times since Sep 2007 from 5.25% to 2%. Yesterday, oil prices dropped by almost $5 dollars on the news that China lifted oil prices which will likely curb consumer demand. However the drop turned out to be short lived. Oil prices are up again today as investors move into commodities as a currency hedge against the declining dollar.

Citigroup warned that it will take a big second-quarter mortgage-related write down and Merrill Lynch downgraded a number of regional banks. Israel had conducted a military exercise over the eastern Mediterranean Sea which appeared to be in preparation for a potential bombing attack of Iran's nuclear facilities. The stock market stumbled to a 3-month low led by concerns over financial sectors and threats of increased violence in the Middle East. The Bond market is up moderately as stocks tank.