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Retail Sales Better than Expected

by Archer Financial Services | Apr 16, 2018

By Alan Bush | Senior Financial Economist at ADMIS   

STOCK INDEX FUTURES 

Stock index futures are higher, as they look past geopolitical risks. There are hopes that the weekend U.S. led missile attack on Syria would not escalate into a broader conflict.

In addition, there is support from expectations of strong corporate earnings.

Investors are expecting tax cuts to help U.S. corporations show their biggest quarterly earnings growth in seven years.

Some analysts are predicting quarterly earnings for S&P 500 companies will increase 17% to 18.6% from a year ago.

Retail sales rose .6% in March from the previous month, after three preceding months of declines. Economists expected a .3% increase.  

The general business conditions index in the Empire State manufacturing survey fell to 15.8 in April from 22.5 in March, according to the New York Federal Reserve. Consensus expectations had been for a reading of 18.2.

The 9:00 central time April housing market index is expected to be 70 and the 9:00 February business inventories report is anticipated to be up .6%.

Longer term, traders will probably gradually shift their focus of attention more toward earnings and the still accommodative global interest rate environment.

 

CURRENCY FUTURES

The U.S. dollar is lower in spite of the recently increased probability that the Federal Open Market Committee will increase its fed funds rate in June.

The U.S. dollar is lower in spite of the bullish U.S. retail sales report, which should be viewed as a sign of weakness for the greenback.

The Canadian dollar and the Australian dollar are higher in spite of lower crude oil prices.

 

INTEREST RATE MARKET FUTURES

Futures are lower as flight to quality longs are liquidated as a result of reduced Mideast tensions.

Earlier today Minneapolis Federal Reserve President Neel Kashkari said recent steps by the federal government to spur economic growth have made him more confident the Federal Reserve will achieve its 2% inflation target soon, which would allow the central bank to push ahead with planned interest rate hikes.        

Atlanta Federal Reserve Bank President Raphael Bostic will speak at 12:15.

The probability of a fed funds rate hike from the Federal Open Market Committee at the June 13 meeting is 95%, which is unchanged from Friday.

 

SUPPORT AND RESISTANCE

 

June 18   S&P 500

Support    2657.00       Resistance    2685.00

 

June 18   U.S. Dollar Index

Support    89.020         Resistance    89.640

 

June 18   Euro Currency

Support    1.23730       Resistance    1.24660

 

June 18   Japanese Yen

Support    .93210         Resistance    .93770

 

June 18   Canadian Dollar

Support    .79200         Resistance    .79730

 

June 18   Australian Dollar

Support    .7745           Resistance    .7795

 

June 18   Thirty Year Treasury Bonds

Support    144^8          Resistance    145^16

 

June 18   Gold

Support    1339.0         Resistance    1355.0

 

May 18   Copper

Support    3.0400         Resistance    3.1100

 

June 18   Crude Oil

Support    66.01           Resistance    67.88


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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