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Comey Testimony Unlikely to Have a Long Term Impact on Financial Markets

by Archer Financial Services | Jun 08, 2017
By Alan Bush | Senior Financial Economist at ADMIS  

STOCK INDEX FUTURES

Prices are mixed ahead of former U.S. Federal Bureau of Investigation Director James Comey's public testimony today.    

In addition, traders are closely monitoring the ongoing geopolitical tensions in the Middle East.   

Jobless claims in the week ended June 3 fell 10,000 to 245,000, when 248,000 were expected.

The 9:00 central time April wholesale inventories report is anticipated to be down .3% and wholesale trade is estimated to be up .2%.

The main trend for stock index futures is higher. 

   

CURRENCY FUTURES

The euro currency is lower even though the European Central Bank removed a reference to the possibility of it lowering interest rates in its regular monetary policy statement today, suggesting the central bank has confidence in the euro zone's economic recovery.

In addition, it left its key interest rates unchanged.

The central bank of the euro zone said, "The Governing Council expects the key ECB interest rates to remain at their present levels for an extended period of time, and well past the horizon of the net asset purchases."  At its previous policy meeting, the ECB left the door open for reducing interest rates.     

According to The European Union's statistics agency, first quarter gross domestic product increased .6% from the last quarter of 2016, and by 1.9% from the first three months of last year. It was previously estimated that quarter-to-quarter growth would be .5%, and year-to-year growth would be 1.7%.

Longer term, we expect the euro currency to advance, while the U.S. dollar underperforms.

There was short term strength in the Japanese yen after the Bank of Japan said it was thinking about how to handle a future exit from its monetary stimulus.

However, the second estimate of Japan's first quarter gross domestic product suggests the BoJ may be in no hurry to scale back, since growth expanded by 1% in the first quarter, which compares to the preliminary reading of 2.2%.

     

INTEREST RATE MARKET FUTURES

Futures are mixed with limited market moving news in the overnight trade.

The Federal Open Market Committee is widely expected to raise interest rates at its June 14 meeting.

The probability of a rate hike is 96%, which compares to 93% yesterday. 

  

SUPPORT AND RESISTANCE

June 17   S&P 500

Support    2427.00       Resistance    2441.00

 

June 17   U.S. Dollar Index

Support    96.460         Resistance    97.300

 

June 17    Euro Currency

Support    1.11880       Resistance    1.12980

 

June 17    Japanese Yen

Support    .90660         Resistance    .91600

 

June 17    Canadian Dollar

Support    .73880         Resistance    .74300

 

June 17   Australian Dollar

Support    .7511           Resistance    .7575

 

September 17   Thirty Year Treasury Bonds

Support    154^0          Resistance    155^0

 

August 17   Gold

Support    1281.0         Resistance    1296.0

 

July 17   Copper

Support    2.5400         Resistance    2.6000

 

July 17   Crude Oil

Support    45.01           Resistance    46.68


For more information about these markets, please contact Alan at 312.242.7911 or via email at alan.bush@admis.com. Thank you.

 

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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 risk of loss in trading futures and options can be substantial. The views and opinions expressed in this letter are those of the author and do not reflect the views of ADM Investor Services, Inc. or its staff.  Research analyst does not currently maintain positions in the commodities specified within this report. 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.

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