Dollar Trades Above Downtrend Line
STOCK INDEX FUTURES
U.S. stock index futures are higher ahead of a big week of earnings from major technology companies, pointing to an extension of last week’s gains.
Recent strength is linked to upbeat earnings, which are outweighing inflation fears.
Of the 117 S&P 500 companies that have reported so far, 84% beat market forecasts, according to Refinitiv.
The September Chicago Federal Reserve national activity index was negative 0.13 when positive 0.29 was expected.
The 9:30 central time October Dallas Federal Reserve manufacturing survey is anticipated to be 4.9.
The longer-term fundamental and technical aspects remain supportive for stock index futures.
The U.S. dollar index is higher and broke out above a 10-day downtrend line.
As we get closer to the November 3 Federal Open Market Committee meeting, traders are likely to refocus their attention to prospects of the Federal Reserve tapering its $120 billion a month in asset purchases.
Higher prices are likely for the greenback in advance of the next FOMC policy meeting.
German business sentiment worsened again in October. The Ifo business-climate index decreased to 97.7 points in October from 98.9 points in September, according to data from the Ifo institute. This was the fourth consecutive decline in the indicator after it peaked at 101.8 in June.
The reading was below a consensus forecast from economists who had estimated the index to decrease to 98.0.
The business expectations component of the index fell to 95.4 in October from 97.4 in the previous month. The measurement that gauges companies’ current business situation also fell, declining to 100.1 from 100.4 in September.
The Ifo index is based on a poll of approximately 9,000 companies in manufacturing, services, trade and construction.
INTEREST RATE MARKET FUTURES
The Federal Reserve Bank of Atlanta’s “GDPNow” model estimate for real GDP growth (seasonally adjusted annual rate) in the third quarter of 2021 was 0.5% on October 19, which is down from 1.2% growth on October 15. The next “GDPNow” update will be released on Wednesday, October 27.
The next leg up for the 30-year Treasury bond futures will likely be after the next FOMC meeting on November 3 is out of the way.
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