Is The Rising Baltic Dry Index A Sign That Commodities Have Bottomed?
By Bill Luby on March 10, 2009 | More Posts By Bill Luby | Author's Website
On the last day of 2008, I urged readers to Watch the Baltic Dry Index in 2009 for clues about the strength of global trade.
To quickly recap, the Baltic Dry Index (BDI) measures shipping rates for dry bulk carriers that carry commodities such as coal, iron and other ores, cocoa, grains, phosphates, fertilizers, animal feeds, etc.
While I have previously chronicled the dramatic drop in production in several of the world’s most important export economies, according to the Baltic Dry Index, shipping rates started moving up in December and have turned up sharply in the past six weeks. Since the beginning of the year, crude oil and copper prices have begun to firm and commodities in general have been outperforming on a relative basis. To be fair, some of the bullish action in commodities has been due to expectations about an increase in the proposed Chinese stimulus package. Given that recent announcements from Beijing have disappointed those looking for new stimulus measures, however, one now has to consider that the BDI and commodity prices have been able to extend their recent gains without the help of increased government spending plans. This development raises the possibility that commodities may indeed be in the process of bottoming.

[source: StockCharts]
Forex Wrap-up: A Massive Short-Covering Rally In The US Dollar May Just Be Starting
The Message Of The 2-Year US Treasury Note, Deflation And Japan
Video: The Week Ahead
3 Steps To Becoming A More Successful Trader
The Transportation Sector: Here Are Three Investments In A Sector That Are Ready To Soar
Bay Street Stocks Slip Slightly Again - Canadian Commentary - 16 hrs ago
Stocks Close Mostly Lower Amid Disappointing Quarterly Results - U.S. Commentary - 17 hrs ago
Bay Street Stocks Linger Slightly Below Unchanged Level - Canadian Commentary - 18 hrs ago
Stocks Remain Stuck In The Red In Mid-Afternoon Trading - U.S Commentary - 19 hrs ago
European Markets Fall, Led By Banks, Oils - European Commentary - 20 hrs ago


