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Stock Index Futures Higher for Seventh Day

by Archer Financial Services | May 11, 2018

By Alan Bush | Senior Financial Economist at ADMIS   

STOCK INDEX FUTURES

Stock index futures are higher for a seventh consecutive day. In addition, European equity markets are set for the longest winning streak in three years. 

Some of the strength can be attributed to St. Louis Federal Reserve Bank President James Bullard when earlier today he outlined a case against any further interest rate hikes, when he said rates may have already reached a “neutral” level that is no longer stimulating the U.S. economy.

The 9:00 May Consumer Sentiment index is expected to be 99. This compares to April's final reading of 98.8. The University of Michigan's Consumer Survey Center asks 500 households every month about their financial conditions and attitudes concerning the economy.

In the longer term, traders will probably gradually shift their focus of attention more toward corporate earnings and the still overall accommodative global interest rate policies and away from a variety of geopolitical worries, including global trade tensions and now the situation between the U.S. and Iran.

 

CURRENCY FUTURES

The U.S. dollar is lower for a third day on limited news, although James Bullard’s comments were bearish for the greenback.

The Canadian dollar and the Australian dollar are higher due to the increase in crude oil prices.

There was additional support for the Canadian dollar on news that full time jobs in Canada in April increased 28,800, which compares to the forecast of a gain of 20,000.

 

INTEREST RATE MARKET FUTURES

Futures are mostly higher after James Bullard reiterated his case against the Fed pursuing more interest rate increases.

The Federal Open Market Committee remains on track to deliver its second rate hike of the year when it meets next month.

The probability of a fed funds rate increase from the FOMC at the June 13 meeting is almost 100%, which is unchanged from yesterday.  

While a June interest rate hike from the Federal Reserve appears to be fully priced in, the odds of a fourth rate hike in December stands at 90%.

Although some analysts are predicting three more interest rate hikes from the Fed this year, I am still anticipating only two more rate increases this year from the Federal Reserve; one in June and another in December.

 

SUPPORT AND RESISTANCE

June 18   S&P 500

Support    2714.00       Resistance    2731.00

 

June 18   U.S. Dollar Index

Support    92.130         Resistance    92.740

 

June 18   Euro Currency

Support    1.19170       Resistance    1.19980

 

June 18   Japanese Yen

Support    .91410         Resistance    .91830

 

June 18   Canadian Dollar

Support    .78210         Resistance    .78660

 

June 18   Australian Dollar

Support    .7513           Resistance    .7577

 

June 18   Thirty Year Treasury Bonds

Support    143^0          Resistance    143^24

 

June 18   Gold

Support    1316.0         Resistance    1329.0

 

July 18   Copper

Support    3.0900         Resistance    3.1300

 

June 18   Crude Oil

Support    70.91           Resistance    71.88
 

 
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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