Written Commentary
Ag Market View for July 26.24
July 26, 2024
STOCK INDEX FUTURES
Stock index futures closed out last week on a strong note despite hawkish comments from U.S. policymakers earlier in the week, including Fed Chair Jerome Powell saying the central bank is “not confident” that it has done enough to bring down inflation. Powell said the central bank will not hesitate to tighten more if needed to bring inflation down to 2.0%.
There are no major economic reports scheduled for today.
However, the October consumer price index report will be released on Tuesday, which is expected to show a 0.1% increase, and on Wednesday the October producer price index will be reported and is anticipated to show a 0.1% advance.
CURRENCY FUTURES
The U.S. dollar firmed today but has underperformed the news in since early October.
Germany’s current account surplus widened in September 2023 from the same month last year.
The Japanese yen depreciated toward 152 per dollar as investors braced for U.S. inflation data and further commentary from Federal Reserve officials this week. So far today there have been no threats of intervention from Japan’s monetary authorities.
INTEREST RATE MARKET FUTURES
The yield on 10 and 30-year U.S. Treasuries increased slightly today as investors reacted to news that on Friday Moody’s lowered its U.S. credit rating outlook from stable to negative, citing increasing fiscal deficits and political standoffs in Washington.
Moody’s said that “without effective fiscal policy measures to reduce government spending or increase revenues” in a high interest rate environment, it expects “that the U.S. fiscal deficits will remain very large and significantly weakening debt affordability.
Financial futures markets are predicting there is an 86% probability that the Federal Open Market Committee will keep its fed funds rate unchanged at its December 13 policy meeting, and there is a 14% probability of a 25 basis point increase.
Interested in more futures markets? Explore our Market Dashboards here.
Risk Warning: Investments in Equities, Contracts for Difference (CFDs) in any instrument, Futures, Options, Derivatives and Foreign Exchange can fluctuate in value. Investors should therefore be aware that they may not realise the initial amount invested and may incur additional liabilities. These investments may be subject to above average financial risk of loss. Investors should consider their financial circumstances, investment experience and if it is appropriate to invest. If necessary, seek independent financial advice.
ADM Investor Services International Limited, registered in England No. 2547805, is authorised and regulated by the Financial Conduct Authority [FRN 148474] and is a member of the London Stock Exchange. Registered office: 3rd Floor, The Minster Building, 21 Mincing Lane, London EC3R 7AG.
A subsidiary of Archer Daniels Midland Company.
© 2021 ADM Investor Services International Limited.
Futures and options trading involve significant risk of loss and may not be suitable for everyone. Therefore, carefully consider whether such trading is suitable for you in light of your financial condition. The information and comments contained herein is provided by ADMIS and in no way should be construed to be information provided by ADM. The author of this report did not have a financial interest in any of the contracts discussed in this report at the time the report was prepared. The information provided is designed to assist in your analysis and evaluation of the futures and options markets. However, any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to ADMIS. Copyright ADM Investor Services, Inc.
