Dow Jones futures advanced to a new record high today, although futures are a little lower now. Recent strength is linked to the relatively low global interest rate structure and optimism about global economic growth.
Third quarter earnings season starts tomorrow. Analysts are anticipating another quarter of growth with the earnings growth estimate at 5.5%, while revenue growth is expected to be 4.3%.
The 9:00 central time August Job Openings and Labor Turnover Survey (JOLTS), which is the monthly change in job openings and offers rates on hiring and quits, is expected to be 6.16 million.
The computer models that I use continue to generate bullish signals for stock index futures.
The main trend for stock index futures is higher.
The U.S. dollar is lower and the euro currency is higher with the U.S. dollar trading near a two week low due to uncertainty over President Donald Trump’s tax plan.
The euro currency hit a two week high as a result of relief that Catalonia stopped short of formally declaring independence from the rest of Spain. The euro was also supported by expectations that the European Central Bank will announce that it is scaling back its huge bond buying program when it holds its next policy meeting on October 26.
The Canadian dollar and the Australian dollar are higher due to firming crude oil prices.
Futures are steady to higher as a result of dovish comments from Chicago Federal Reserve Bank President Charles Evans earlier today during a speech in Zurich when he said one more rate increase before the end of 2017 isn’t set in stone. He said, "It makes sense to continue to increase policy gradually as we assess whether inflation is going to get to the 2% objective."
The Federal Reserve will release the minutes of its September policy meeting at 1:00.
The U.S. central bank kept interest rates unchanged at its meeting in September and indicated that it still intended to hike rates in December, in spite of the sluggish inflation outlook. The Fed also announced that it would begin scaling back its $4.5 trillion balance sheet in October.
The Treasury will auction three and 10 year notes today.
San Francisco Federal Reserve Bank President John Williams will speak at 1:40.
The Federal Reserve appears to be on track to raise its fed funds rate for a third time this year, and the fifth since late 2015, to a range of between 1.25% and 1.50%.
According to financial futures markets, the probability that the Federal Open Market Committee will increase its fed funds rate at the December 13 meeting is 93%, which compares to 88% yesterday.
The long term fundamentals for futures are mixed.
December 17 S&P 500
Support 2541.00 Resistance 2553.00
December 17 U.S. Dollar Index
Support 92.730 Resistance 93.250
December 17 Euro Currency
Support 1.18310 Resistance 1.18980
December 17 Japanese Yen
Support .89030 Resistance .89550
December 17 Canadian Dollar
Support .79730 Resistance .80150
December 17 Australian Dollar
Support .7755 Resistance .7811
December 17 Thirty Year Treasury Bonds
Support 151^26 Resistance 153^0
December 17 Gold
Support 1285.0 Resistance 1297.0
December 17 Copper
Support 3.0500 Resistance 3.0850
November 17 Crude Oil
Support 50.73 Resistance 51.78
For more information about these markets, please contact Alan at 312.242.7911 or via email at email@example.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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The risk of loss in trading futures and options on futures can be substantial. Each investor must carefully consider whether this type of investment is appropriate for them. Past performance is not necessarily indicative of future results.