The S&P and Nasdaq stock index futures markets have this week produced bullish upside “breakouts” above what was strong support at the recent highs. Both indexes also hit contract and record highs this week. The bulls have now gained good technical power to suggest another solid leg up in prices in the near term. Stay tuned!–Jim
Daily Morning Report
FOMC Meeting on Deck; Many Markets in Pause Mode, Awaiting Fed Decision
Tuesday, October 29–Jim Wyckoff’s Morning Markets Report
Asian and European stock indexes were mostly weaker in quieter trading overnight, as the FOMC meets today. U.S. stock indexes are pointed toward narrowly mixed openings when the New York day session begins. The S&P 500 and Nasdaq indexes scored record highs on Monday. Trader and investor optimism remains elevated early this week amid reports from China and the U.S. that their Phase 1 part of a trade deal is nearly ready for signing.
It’s a very big U.S. economic data week, highlighted by the Federal Reserve’s Open Market Committee (FOMC) meeting that starts Tuesday morning and ends Wednesday afternoon with a statement. It’s widely expected the Fed will cut interest rates by 0.25%. What is not so clear is the glide path the Fed will issue on future monetary policy moves.
On Wednesday the gross domestic product report is out and on Friday comes the employment report from the Labor Department. Other key reports are also out this week.
The key “outside markets” find Nymex crude oil prices weaker in early U.S. trading today and trading around $55.00 a barrel. Meantime, the U.S. dollar index is higher.
U.S. economic data due for release Tuesday includes the weekly Goldman Sachs and Johnson Redbook retail sales reports, the S&P/Case-Shiller home price index, pending home sales, and the consumer confidence index.
–Jim
Big U.S. Data Week Lies Just Ahead
Monday, October 28–Jim Wyckoff’s Morning Markets Report
Asian and European stock indexes were mostly up overnight and are now at or near their highs for the year. U.S. stock indexes are pointed toward modestly higher openings when the New York day session begins. Trader and investor optimism remains elevated as weekend reports from China said the Phase 1 part of the U.S.-China trade deal is nearly ready for signing.
The markets are not reacting to the weekend news the U.S. military eliminated the world’s top ISIS terrorist leader.
There was more downbeat economic data coming out of China, as the world’s second-largest economy over the weekend reported its industrial sector profits declined significantly in September.
It’s a very big U.S. economic data week, highlighted by the Federal Reserve’s FOMC meets that starts Tuesday and the important U.S. jobs report that’s out Friday morning. It’s also the busiest week of the U.S. corporate earnings reports season.
Metals traders will see one of the bigger weeks of the year for their markets, as its LME Week in London.
The key “outside markets” today find Nymex crude oil prices slightly weaker in early U.S. trading today and trading around $56.50 a barrel. Meantime, the U.S. dollar index is slightly down.
U.S. economic data due for release Monday includes the Chicago Fed national activity index, advance economic indicators and the Texas manufacturing outlook survey.
–Jim
Euro Currency Bulls Working on a Price Uptrend
The Euro currency futures is one of the most popularly traded futures market in the world. See on the daily bar chart for the March Euro currency that prices are starting to trend higher and the bulls have gained some strength to suggest a market bottom is in place. It will take a move above chart resistance at the 1.1300 level to give the bulls fresh power to suggest the price uptrend can be sustained. A drop below the support line seen on the chart would negate the fledgling price uptrend and give the bears renewed power. Stay tuned!–Jim
World Stock Markets Mixed Friday; No Geopolitical Hot Spots at Present
Friday, October 25–Jim Wyckoff’s Morning Markets Report
Asian and European stock indexes were mixed overnight. U.S. stock indexes are pointed toward slightly higher openings when the New York day session begins. Trader and investor risk appetite remains mostly upbeat as U.S. stock indexes are hovering not far below their all-time highs scored earlier this year.
The Russian central bank on Friday cut its main interest rate by 0.5%, to 6.5%. The move pressured the Russian currency, the ruble.
In other overnight news, the European Central Bank lower its expectations for Euro zone economic growth in the coming years, at 1.1% in 2019, at 1.0% in 2020, and at 1.3% in 2021. The ECB forecast inflation for the same three years at 1.2%,1.2% and 1.4%, respectively.
Reports say the U.S. and China continue to hash out “Phase 1” of their trade agreement reached a couple weeks ago. The U.S. is pushing China to purchase more U.S. ag products in exchange for the U.S. eliminating some of its tariffs on Chinese imports. While it appears the trade talks have made progress, veteran market watchers know “the devil is in the details.”
The key “outside markets” today find Nymex crude oil prices slightly weaker in early U.S. trading today and trading around $56.00 a barrel. Meantime, the U.S. dollar index is near steady.
U.S. economic data due for release Friday includes the University of Michigan consumer sentiment survey.
–Jim
Central Bank Meetings in Focus Thursday, as Draghi Departs
Thursday, October 24–Jim Wyckoff’s Morning Markets Report
Asian and European stock indexes were mixed but mostly firmer overnight. U.S. stock indexes are pointed toward modestly higher openings when the New York day session begins. Focus in the U.S. stock market is on a heavy slate of corporate earnings reports this week.
The European Central Bank is holding its regular monetary policy meeting Thursday, which is the last one for outgoing ECB chief Mario Draghi. No major changes in ECB monetary policy is expected at this meeting.
The central bank of Indonesia cut its interest rates today, with Turkey expected to do the same today. The central banks of Sweden and Norway held their interest rates steady at meetings today.
The Euro zone October composite purchasing managers index (PMI) came out at 50.2, which was slightly below expectations. The manufacturing PMI in October was 45.7. A reading below 50.0 suggests contraction in the sector. Germany, the workhorse of the Euro zone economy, had a manufacturing PMI reading of 41.9 in October.
The key “outside markets” today find Nymex crude oil prices weaker in early U.S. trading today and trading around $55.50 a barrel. Meantime, the U.S. dollar index is slightly up on a mild corrective bounce from recent selling pressure that drove the index to a nine-week low earlier this week.
U.S. economic data due for release Thursday includes the weekly jobless claims report, durable goods orders, the U.S. flash manufacturing and services PMIs, new residential sales and the Kansas City Fed manufacturing survey.
–Jim