DARTLINE INVESTOR

November 18, 2009, 6:30 am … The Standard & Poor’s 500 index futures up 2.20 to 1109.10, as the weakening dollar increases trader appetite for stocks and commodities like gold and oil, which are priced in greenbacks and can provide a hedge against ‘dead money” U.S. currency. Early action in Europe — Britain’s FTSE 100 rose 0.2 percent, Germany’s DAX was up 0.4 percent and France’s CAC 40 climbed 0.5 percent — suggests market overheating remains in the distance. … South Korea’s key index rose 1.1 percent to 1,603.97 and Shanghai’s benchmark was up 0.6 percent to 3,303.23. Shares in Taiwan and Australia were modestly higher as well, while Japan and Hong Kong led the Asia’s declines, with Tokyo’s Nikkei 225 stock average losing 53.13 points, or 0.6 percent, to 9,676.80 and Hong Kong’s Hang Seng shedding 73.82, or 0.3 percent, to 22,840.33. … Benchmark crude for December delivery was up 61 cents to $79.75 a barrel at late afternoon Singapore time in electronic trading on the New York Mercantile Exchange. The contract rose 24 cents to settle at $79.14 on Tuesday. U.S. crude inventories unexpectedly fell last week, the American Petroleum Institute said late Tuesday. Crude stocks fell 4.4 million barrels while analysts had expected a rise of 1.2 million barrels. Dartline remains bearish as weak global economic growth should keep commodities such as oil from surging much higher. Global growth will likely average 1.9 percent a year during the next three years, less than half the rate between 2002 and 2007.

The U.S. Treasury Department is discussing ways to keep in reserve some emergency bailout funds even if the TARP isn’t extended beyond the end of the year. Treasury Secretary Geithner may opt to extend the program, which expires on Dec. 31. But even if the program isn’t extended, officials want to keep at least some of the money that has yet to be committed to any particular program on hand in case financial conditions worsen and the government is forced to step in. The decision of whether to extend TARP has become embroiled in a debate over the unpopularity of the $700 billion bailout and the nation’s mounting fiscal woes. Mr. Geithner hasn’t yet determined whether to extend the government’s TARP authority, Treasury officials said. Even if TARP is allowed to expire, the program won’t technically end until the government’s investments are repaid and the U.S. is no longer a shareholder in financial institutions. Treasury officials are discussing whether there is any way to preserve that money without extending TARP. While there is no plan to spend additional bailout funds, Treasury officials want the ability to respond in case financial conditions deteriorate. Neal Wolin, Treasury’s deputy secretary, said it was too early to make a decision on whether to extend TARP. “We will be looking at and making judgments about [extending TARP] in the weeks and months ahead.” … With Standard & Poor’s 500 index closing above 1,100, don’t discount further gains even as the market lacks fundamental underpinning. However, weak consumer confidence remains a “game changer” as the holidays approach and could initiate a wave of profit taking in the U.S. — the impact of which would doubtless be felt on markets across the globe. Therefore, change support to 1081.10 from 1044.80 as near -term level.