Stocks fluctuated Wednesday as positive indicators in manufacturing compensated for a decline in commodities prices.
Investors were encouraged by a key economic indicator that pointed toward growth in the Midwest manufacturing industry for a third month in a row. The Chicago Purchasing Managers Index rose 3.9 points this month to 60. The document revealed that manufacturing, employment and orders all improved in December.
Still the market’s gains were limited by the strengthening dollar the resultant slip in energy and material stocks. Foreign buyers are consistently discouraged by a stronger dollar which pushes down commodities.
Many investors have been putting their funds in the USD lately as economists predict a more stable 2010 along the Federal Reserve finally raising interest rates above next to zero.
This year has been defined by the minimal interest rates, prompting investors to transfer funds into riskier assets rather than cash. The rising of interest rates in 2010 would be a positive sign for the US economy but it may disrupt the advances the market has seen in 2010.
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