Daily Morning Report

Wednesday, September 26–Jim Wyckoff’s Morning Markets Report

OVERNIGHT DEVELOPMENTS

World stock markets were mixed to mostly firmer overnight. U.S. stock indexes are also pointed toward firmer openings when the New York day session begins.

Traders and investors are awaiting the conclusion of the two-day FOMC meeting that began Tuesday morning and ends Wednesday afternoon with a statement. The FOMC is widely expected to slightly raise U.S. interest rates at this meeting, marking the third rate rise this year. Fed Chairman Jerome Powell will also hold a press conference after the meeting. As usual, the marketplace will parse the Fed’s and Powell’s wording for clues on the pace of future Fed rate hikes and the Fed’s inflation expectations.

Focus in Europe is now on the new Italian government’s economic plans to address its fiscal and financial problems, which are required by European Union law. Many believe Italian lawmakers won’t comply with EU rules on the matter.

The key outside markets today find the U.S. dollar index slightly higher. Meantime, November Nymex crude oil prices slightly lower and trading just above $72.00 a barrel. Supply worries have boosted oil recently. U.S. sanctions against Iran begin in early November, which will likely take much of that country’s oil off the world market. President Trump has singled out Iran in front of the United Nations this week as being a terrorist state that needs heavy economic sanctions. Trump also called out the OPEC oil cartel for holding prices artificially high, saying OPEC countries may not get financial or military support from the U.S.

Other U.S. economic data due for release today includes the weekly MBA mortgage applications survey, new residential sales and the weekly DOE liquid energy stocks report.

–Jim

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Tuesday, September 25–Jim Wyckoff’s Morning Markets Report

OVERNIGHT DEVELOPMENTS

World stock markets were mixed to mostly firmer overnight.
U.S. stock indexes are pointed toward firmer openings when
the New York day session begins. There are lingering
worries U.S. and China’s trade war will escalate to the
point of damaging world commerce. Meanwhile, President
Trump is negotiating bi-lateral trade deals with other
Asian countries and has signed an agreement with South
Korea.

Focus early this week is on the Federal Reserve’s two-day
Open Market Committee (FOMC) meeting that begins Tuesday
morning and ends Wednesday afternoon with a statement. The
FOMC is expected to slightly raise U.S. interest rates at
this meeting. Fed Chairman Jerome Powell will also hold a
press conference after the meeting.

The key outside markets today find the U.S. dollar index
slightly lower and hovering near last week’s 2.5-month low.
The greenback bears have downside technical momentum to
suggest a market top is in place for the USDX. Meantime,
November Nymex crude oil prices are higher and trading
around $72.50 a barrel. Supply worries have boosted oil
recently. U.S. sanctions against Iran begin in early
November, which will likely take much of that country’s oil
off the world market.

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The Euro currency futures is one of the most popularly traded markets in the world. See on the daily bar chart for the December futures contract that prices are in an uptrend and have just hit a 2.5-month high. It appears a near-term market bottom is in place for the Euro currency and that prices will trade at least sideways, of not sideways to higher, in the coming few weeks. Stay tuned!

Monday, September 24–Jim Wyckoff’s Morning Markets Report

OVERNIGHT DEVELOPMENTS

World stock markets were mostly lower overnight. U.S. stock indexes are pointed toward weaker openings when the New York day session begins. There is a bit more risk aversion in the world marketplace to start the trading week, as U.S.-China trade tensions are back on the front burner after China accused President Trump of being a trade bully and cancelled trade talks that had been set up for this week. And tariffs on $200 billion more in Chinese imports to the U.S. are set to kick in today. Stocks markets in China, Japan and South Korea were closed Monday for a holiday.

Focus this week will also be the Federal Reserve’s two-day Open Market Committee (FOMC) meeting that begins Tuesday. The FOMC is expected to slightly raise U.S. interest rates at this meeting. Fed Chairman Jerome Powell will also hold a press conference after the meeting.

The key outside markets today find the U.S. dollar index lower. Prices Friday hit a 2.5-month low. The greenback bears have downside technical momentum to suggest a market top is in place for the USDX. Meantime, November Nymex crude oil prices are solidly higher and hit a contract high today, and trading just above $72.00 a barrel.

U.S. economic data due for release today includes the Chicago Fed national activity index and the Texas manufacturing outlook survey.

–Jim

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Friday, September 21–Jim Wyckoff’s Morning Markets Report

OVERNIGHT DEVELOPMENTS

World stock markets were mostly firmer overnight. U.S. stock indexes are pointed toward slightly higher openings when the New York day session begins. The S&P 500 and Dow stock indexes are at record highs. There is little risk aversion in the world marketplace at present.

Goldman Sachs is predicting the U.S.-China trade war will be extended and will eventually see the U.S. putting tariffs on all Chinese imports into the U.S. Earlier this week, Alibaba founder Jack Ma said the U.S.-China trade war could last many years.

A feature in the marketplace this week has been falling U.S. Treasury prices (rising yields). The U.S. 10-year T-Note is presently yielding around 3.07%.

Traders and investors are looking ahead to next week, when the Federal Reserve’s Open Market Committee (FOMC) meets to discuss U.S. monetary policy. Many believe the Fed will make a slight interest rate increase at the meeting.

The key outside markets today find the U.S. dollar index mildly up on a corrective rebound from this week’s selling pressure that drove prices to a 2.5-month low on Thursday. The greenback bears have downside technical momentum to suggest a market top is in place for the USDX. Meantime, Nymex crude oil prices are firmer and trading just below $71.00 a barrel. Around present price levels rallies have been capped several times this year.

U.S. economic data due for release Friday includes the flash services purchasing managers index (PMI) and the flash manufacturing PMI.

–Jim

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he U.S. Treasury bonds and notes futures markets are trending lower and hit four-month lows this week. The U.S. Treasury bears have the near-term technical advantage, which suggests more sideways-to-lower price action in the coming days, or longer. Stay tuned!