Written Commentary
Forecasted Weather A Factor
April 26, 2024
Fed Chair Powell Comments Support Stock Indexes
- May 18, 2020
- Zoe Scott
- Follow us on Twitter @TradeADMIS
STOCK INDEX FUTURES
Stock index futures are sharply higher after Federal Reserve Chair Jerome Powell expressed optimism Sunday that the U.S. economy can begin to recover in the second half of the year, although he acknowledged that it could take more than a year to recover.
Fed Chair Powell said, “We’re not out of ammunition by a long shot” as the Fed could enlarge existing lending programs or begin new ones.
Mr. Powell is due to appear before the Senate Banking Committee tomorrow at 9:00 central time.
The 9:00 May housing market index is expected to be 33.
The technical picture continues to improve for stock index futures.
CURRENCY FUTURES
The U.S. dollar is lower on the belief that the Federal Reserve could do more to stimulate the U.S. economy, especially after Fed Chair Powell’s recent comments.
The British pound is steady despite growing speculation that the U.K. may be next to push interest rates below 0%.
The Japanese yen is lower after a report showed Japan’s economy, the world’s third largest, fell into a recession in the first quarter. The economy shrank an annualized 3.4% in the three months ended March 31 after a 7.3% contraction in the previous quarter. Economists expected a 4.8% annualized contraction. Two consecutive quarters of contraction is one definition of a recession.
INTEREST RATE MARKET FUTURES
Safe-haven longs are being liquidated in light of sharply higher stock index futures, especially at the long end of the curve.
Last week the Federal Reserve said its ’s balance sheet grew to a record $6.98 trillion in the week ended May 13, which is up from $6.72 trillion in the previous week.
The thirty-year Treasury bond futures are in a broadly based congestion pattern, as the main fundamental influences are offsetting.
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.
