U.S. GDP Stronger than Expected

by Archer Financial Services | Aug 29, 2018

By Alan Bush | Senior Financial Economist at ADMIS   


U.S. stock index futures were a little lower in the overnight trade on uncertainty over Canada’s position in NAFTA. The U.S. and Canada are set for bilateral talks today, as the two nations work to salvage the North American Free Trade Agreement.

Futures recovered when the stronger than expected second quarter gross domestic product report was released.  

Gross domestic product, which is the value of all goods and services produced across the economy, increased at a 4.2% annual rate in the second quarter. Economists expected an unchanged reading of 4.1%

The 4.2% rate marks the strongest pace of growth in almost four years.  

The 9:00 central time July pending home sales index is expected to be unchanged.

The still relatively low global interest rate environment and the mostly stronger than estimated U.S. corporate earnings reports remain long term supportive to U.S. stock index futures.



The U.S. dollar firmed due to concerns that the conflict over trade between the U.S. and China was not about to be resolved any time soon.

There was additional support for the greenback on news of the stronger than anticipated U.S. gross domestic product report.

The Canadian dollar and the Australian dollar are only mixed in spite of gains in crude oil prices.



Futures are mixed with the bullish influence of flight to quality buying being offset by the bearish influence of the stronger than estimated U.S. gross domestic product report.

The Treasury will auction seven year notes today.

The latest reading on gross domestic product bolsters the probability that Federal Reserve officials will raise short term interest rates two more times this year.

Central bank officials have already hiked rates twice this year to a range of between 1.75% and 2%.

According to financial futures markets, the probability of a fed funds rate increase at the Federal Open Market Committee’s September 26 meeting is 96%.



September 18   S&P 500

Support    2895.00      Resistance    2911.00


September 18   U.S. Dollar Index

Support    94.550        Resistance    94.880


September 18   Euro Currency

Support    1.16630      Resistance    1.17260


September 18   Japanese Yen

Support    .89830        Resistance    .90160


September 18   Canadian Dollar

Support    .77270        Resistance    .77600


September 18   Australian Dollar

Support    .7280          Resistance    .7360


September 18   Thirty Year Treasury Bonds

Support    144^8         Resistance    144^30


December 18   Gold

Support    1203.0        Resistance    1217.0


September 18   Copper

Support    2.6900        Resistance    2.7400


October 18   Crude Oil

Support    68.17          Resistance    69.43

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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