Written Commentary
Ag Market View for Apr 26.24
April 26, 2024
STOCK INDEX FUTURES
Stock index futures are higher across the board as earnings are mostly stronger than expected.
The 9:00 central time March housing market index is expected to be 48.
Stock index futures have traded higher this year despite a Federal Reserve that is slow to pivot to accommodation.
The fundamentals are mostly bullish, while the technicals remain supportive to stock index futures.
CURRENCY FUTURES
There is a heavy slate of central bank policy meetings this week.
The Bank of Japan is expected to announce its first rate hike in 17 years at the conclusion of its two-day meeting on Tuesday.
The Reserve Bank of Australia will announce its interest rate decision on Tuesday with analysts expecting the RBA to leave the cash rate at 4.35%.
The Federal Reserve will announce its policy decision on Wednesday. No change in the fed funds rate is anticipated.
On Thursday the Bank of England will likely announce it is keeping its key interest rate unchanged at 5.25%.
The Swiss National Bank will probably announce on Thursday that it is keeping its key rate unchanged.
The euro zone February 2024 consumer price index increased 0.6% is anticipated. The euro area annual inflation rate was 2.6% in February 2024, which is down from 2.8% in January. A year earlier the rate was 8.5%.
Japan’s core machinery orders fell more than expected in January.
INTEREST RATE MARKET FUTURES
The Federal Reserve is anticipated to keep interest rates steady at its policy statement on Wednesday. The focus will be on new economic projections and any clues on the timing of a potential fed funds rate cut.
Financial futures markets are predicting there is a 1.0% probability that the Federal Open Market Committee will lower its fed funds rate by 25 basis points at the March 20 meeting, and there is a 99% chance that the Fed will keep rates unchanged.
Analysts are becoming more confident that any interest rate reductions will probably occur later in the year, especially after recent consumer price index and producer price index reports exceeded expectations.
The fundamentals and technicals remain bearish on balance for futures at the short end of the yield curve.
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