Intermarket: Wall Street closed a great deal lower on strong DXY

Wall Street closed a great deal lower today with poor earnings seasons results with Alcoa Inc. ( shares closed down more than 11% due to poor earnings) a poor show while at the same time, the dollar rose sharply this week with the DXY popping the 97 handle.

The U.S. dollar has been strong and is concerning Wall Street due to translation risk for the multinational companies. ICE U.S. Dollar Index was very strong today and moved up around 0.8% through the half way point on the 97 handle reaching as high as 97.68 and the highest level for more than 7 months, up 2.3% so far this month in fact. 

Oil prices  were down by 1.1% at $50.79 due to  producing nations such as Libya, Iran and Nigeria that have all said they aim to pump additional volumes that could total 700,000 barrels of oil a day over August levels.

This all leaves doubts as to whether the Organization of the Petroleum Exporting Countries (OPEC) can really achieve production cuts that had been agreed last month to end a crude glut that has decreased the price of oil and petroleum related products for the last two years. 

As a result of all the above, the Dow Jones Industrial Average dropped a huge 200.38 points, or 1.1%, to close at 18,128.66 while the S&P 500 Index closed down 26.93 points, or 1.2%, at 2,136.73. The Nasdaq Composite index fell 81.89 points, or 1.5%, to close at 5,246.79 while the dollar jumped 0.7%.