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As we spoke about earlier in the week then tropical storm Dean was likely to become the first major Atlantic hurricane of the season, and it has done just that. The latest report from the national hurricane center puts Dean at a very strong category 4 storm, with winds of 150 mph. The storm is expected to gain a little more strength and probably reach category 5 status before slamming into the Cancun Mexico area. Where the storm goes after that is still a mystery, though most models have it going toward northern Mexico, or possibly the southern tip of Texas. Here is one forecast eye path from Accuweather.                

Why does all of this matter to you the investor? Because this storm is likely to move a large amount of stocks in one way or another. My earlier article spoke of several stocks who would likely benefit from a strong hurricane such as Dean. There are also stocks who could be hurt by such a hurricane, especially if it makes landfall in the United States and produces widespread damage. American International Group Inc (NYSE: AIG) and The Allstate Corporation (NYSE: ALL) are two insurers who are hurt quite extensively by hurricane damages.

If Dean decides to take a path toward the middle of the Gulf, where many oil rigs are, the price of oil could skyrocket. If Dean goes on a westward path and simply crashes into the Mexican coast without giving much impact to the Texas coast at all, it is possible oil stocks will fall. One way or another, Hurricane Dean is very likely to be a big story on the street in the coming few days. Stay tuned!