Gold prices pushed to a three-week high Thursday, in the wake of a surprisingly dovish FOMC meeting of the Federal Reserve this week. Gold bulls have gained upside momentum this week and are working on a price uptrend. Look for gold and silver prices to continue to work sideways to higher in the near term. Stay tuned!
Daily Morning Report
Markets Ponder Effects Of More Dovish U.S. Federal Reserve
Thursday, March 21–Jim Wyckoff’s Morning Markets Report
OVERNIGHT DEVELOPMENTS
Asian and European stocks were mixed overnight. U.S. stock indexes are also pointed toward mixed openings when the New York day session begins.
The world marketplace is still digesting Wednesday afternoon’s Federal Open Market Committee (FOMC) meeting conclusion and Fed Chairman Powell’s press conference. Surprisingly, the Fed took another strong step in the direction of easier U.S. monetary policy. The FOMC statement said the Fed would keep U.S. interest rates unchanged and plans no more rate hikes this year. The statement also said the U.S. labor market remains strong but U.S. economic growth has slowed a bit, as evidenced by slower household spending and lower business investment.
U.S. stocks initially were supported on the dovish Fed stance, but then sold off on worries about slowing global economic growth. Gold prices are solidly higher today and hit a three-week high overnight, boosted on the dovish Fed news Wednesday afternoon. Palladium prices hit another record high overnight and are trading above $1,575.00 an ounce.
The world markets are again trying to figure out if the U.S. and China are close to a substantive trade deal. Early-week reports said the U.S. and China were moving closer to a formal trade agreement. U.S. Treasury Secretary Mnuchin and U.S. Trade Representative Lighthizer are traveling to China next week for high-level discussions. However, on Wednesday President Trump said U.S. tariffs on China won’t be lifted right away even if a trade deal is reached soon.
The key outside markets today see the U.S. dollar index higher an upside correction after solid losses and hitting a six-week low Wednesday. The greenback bulls have faded recently. Meantime, Nymex crude oil prices are modestly lower and trading just below $60.00 a barrel. Oil prices hit a four-month high overnight.
U.S. economic reports due for release Thursday includes the weekly jobless claims report, the Philadelphia Fed business survey, and leading economic indicators.
–Jim
Markets Quieter at Midweek as FOMC Meeting Conclusion Awaited
Wednesday, March 20–Jim Wyckoff’s Morning Markets Report
OVERNIGHT DEVELOPMENTS
Asian and European stocks were mostly higher overnight. Risk appetite in the world marketplace remains upbeat, as there are no major geopolitical matters moving the world markets. U.S. stock indexes are pointed toward narrowly mixed openings when the New York day session begins.
Trader and investor focus is on the FOMC meeting of the Federal Reserve, which began Tuesday morning and ends Wednesday afternoon with a statement. The FOMC is not expected to change its monetary policy at this meeting. The Fed has become more dovish the past few months. As usual, the marketplace will glean the FOMC statement and Fed Chairman Jerome Powell’s wording for clues on the future path and timing of monetary policy changes.
News reports are saying the U.S. and China are moving closer to a formal trade agreement after the two largest economies in the world fought a trade war for months. Reports said U.S. Treasury Secretary Mnuchin and U.S. Trade Representative Lighthizer are traveling to China next week for high-level discussions to try to get a deal wrapped up. Some are now speculating that a deal will be reached, but it won’t include important demands the U.S. had made, such as theft of intellectual property.
The key outside markets today see the U.S. dollar index slightly firmer on an upside correction after hitting a three-week low Tuesday. The greenback bulls have faded recently. Meantime, Nymex crude oil prices are modestly lower and trading just below $59.50 a barrel. Oil prices hit a four-month high Tuesday.
U.S. economic reports due for release Wednesday include the weekly MBA mortgage applications survey, the weekly DOE liquid energy stocks report, and the FOMC statement and Powell press conference.
–Jim
Palladium Prices Push to Record High
Palladium prices soared to a record high above $1,150 a ton this week, due in part to Russia, the world’s largest producer, banning the export of scrap and tailings of precious metals from May until November. There are no early chart clues that the market is close to topping out. Stay tuned!
Still Not Much Risk Aversion in World Marketplace
Tuesday, March 19–Jim Wyckoff’s Morning Markets Report
OVERNIGHT DEVELOPMENTS
Asian and European stocks were mostly higher overnight. Risk appetite in the world marketplace remains elevated, as there are no major geopolitical matters jolting the world markets. U.S. stock indexes are pointed toward firmer openings when the New York day session begins.
Trader and investor focus is on the FOMC meeting of the Federal Reserve, which begins Tuesday morning and ends Wednesday afternoon with a statement. The FOMC is not expected to change its monetary policy at this meeting. The Fed has become more dovish the past few months. As usual, the marketplace will glean the FOMC statement and Fed Chairman Jerome Powell’s wording for clues on the future path and timing of monetary policy changes.
The unresolved Brexit matter continues simmer on the back burner of the world marketplace. The latest development saw a Member of Parliament block for voting a plan presented by Prime Minister Theresa May. It’s becoming more likely that the U.K.’s exit from the European Union will be a long, drawn-out affair.
In other overnight news, the closely watched German Zew economic expectations index rose to -3.4 in March from -13.4 in February. The March number beat trade expectations for a reading of -10.0.
Palladium prices soared to a record high above $1,150 a ton overnight, due in part to Russia, the world’s largest producer, banning the export of scrap and tailings of precious metals from May until November.
The key outside markets today see the U.S. dollar index weaker. The greenback bulls have faded recently. Nymex crude oil prices are modestly higher and trading around $59.50 a barrel. Oil prices hit a four-month high overnight.
U.S. economic reports due for release Tuesday include the weekly Johnson Redbook and Goldman Sachs retail sales reports, and manufacturers’ shipments and inventories.
–Jim
Quiet Start to Trading Week; FOMC Meeting On Deck
Monday, March 18–Jim Wyckoff’s Morning Markets Report
OVERNIGHT DEVELOPMENTS
Asian and European stocks were mostly higher overnight. There were no major geopolitical developments during the weekend to move the markets, and trading is quieter to start the week. U.S. stock indexes are pointed toward mixed openings when the New York day session begins.
Trader and investor focus is turning to this week’s FOMC meeting of the Federal Reserve, which begins Tuesday and ends Wednesday afternoon with a statement. The FOMC is not expected to change its monetary policy at this meeting. The Fed has become more dovish the past few months.
The Brexit matter continues to play out but it’s on the back burner of the world marketplace. The U.K. has no “soft Brexit” deal in place ahead of the March 29 “hard exit” (no deal) for the U.K. to leave the European Union. Look for Prime Minister Theresa May to soon propose another plan for a soft Brexit to the Parliament.
The key outside markets today see the U.S. dollar index weaker. Nymex crude oil prices are modestly lower and trading just above $58.00 a barrel. Oil prices hit a four-month high last Friday.
U.S. economic reports due for release Monday are light and include the NAHB housing market index.
–Jim