By Alan Bush | Senior Financial Economist at ADMIS
U.S. and Chinese officials will start another round of trade talks in Beijing next week. The U.S. delegation is scheduled to begin arriving in Beijing over the weekend.
Approximately 71% of over half of the S&P 500 companies that have reported fourth quarter results have exceeded profit expectations, according to Refinitiv.
However, analysts are reducing their earnings expectations for the first quarter of 2019.
Stock index futures have been performing better than the news would suggest lately, with the S&P 500 enjoying its best January in more than 30 years, which should be viewed as a sign of strength.
The U.S. dollar advanced by default. Although the U.S. dollar is a little higher today, it has underperformed the news in recent weeks.
The euro currency is lower over worries that the euro zone economy is struggling.
German factory orders in December fell 1.6%, the steepest decline in six months, contributing to a 7% drop on an annualized basis.
The Bank of England is scheduled to meet tomorrow and is widely expected to keep interest rates unchanged.
The Canadian dollar is lower in spite of news that Canadian building permits unexpectedly climbed 6% in December, marking the fourth consecutive monthly increase. Market expectations were for a 1% drop.
The Australian dollar fell after the Reserve Bank of Australia’s central bank chief signaled a shift to a neutral stance on policy and opened the door for a possible rate reduction in a sudden shift from its long standing tightening bias.
It was only just yesterday that the RBA had steered clear of an easing signal following its policy meeting and issued an upbeat statement.
In spite of lower prices today, longer term the Canadian dollar and the Australian dollar should trend higher, as industrial commodity prices are likely to increase in price.
They Treasury will auction ten year notes today.
At 5:05 central time Federal Reserve Board Vice Chairman for Supervision Randal Quarles will deliver a speech about the Federal Reserve stress testing.
At 6:00 Federal Reserve Chairman Jerome Powell will host a town hall meeting with educators from across the country.
Financial futures markets are predicting an 84% probability that the fed funds rate will remain unchanged at the current level of 2.25%-2.50% this year.
There is a 4% chance of an increase in the fed funds rate by 25 basis points, and there is a 12% probability of a 25 basis point rate cut in 2019.
Futures will probably drift lower, as optimism for a U.S.-China trade deal is likely to increase.
March 19 S&P 500
Support 2722.00 Resistance 2741.00
March 19 U.S. Dollar Index
Support 95.710 Resistance 96.050
March 19 Euro Currency
Support 1.14110 Resistance 1.14550
March 19 Japanese Yen
Support .91080 Resistance .91630
March 19 Canadian Dollar
Support .75710 Resistance .76300
March 19 Australian Dollar
Support .7111 Resistance .7256
March 19 Thirty Year Treasury Bonds
Support 145^16 Resistance 146^12
April 19 Gold
Support 1312.0 Resistance 1326.0
March 19 Copper
Support 2.8100 Resistance 2.8550
March 19 Crude Oil
Support 52.59 Resistance 54.27
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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