header_img

CPI Tame

by Archer Financial Services | Mar 12, 2019

By Alan Bush | Senior Financial Economist at ADMIS   

STOCK INDEX FUTURES

The February National Federation of Independent Business small business optimism index was 101.7, which compares to the estimate of 102.5.

U.S. consumer prices increased in February, as energy and food prices picked up, although the broader trend suggested inflationary pressures remain relatively tame.

The consumer price index rose a seasonally adjusted 0.2% in February, as anticipated, while the volatile food and energy categories, the core prices, increased 0.1%, which compares to the estimate of a .2% gain.

Since the lows were made in late December, stock index futures have been performing better than the news would suggest, which should be viewed as a sign of long term strength.

 

CURRENCY FUTURES

The U.S. dollar declined as Brexit hopes boosted investor demand for riskier currencies.

The British pound initially advanced after an apparent breakthrough in Brexit negotiations between the E.U. and the U.K. encouraged buying of riskier currencies.

The pound fell later as optimism faded.

Pressure on the pound was limited by news that the U.K. economy rebounded in January after a weak December.

The Office for National Statistics said the U.K. economy grew at an annualized rate of 1.1% in the three months through January, which is up from a revised 0.9% in the three months through December.

Higher crude oil prices supported the Canadian dollar and the Australian dollar.

 

INTEREST RATE MARKET FUTURES

The Treasury will auction ten year notes today.

Financial futures markets are predicting an 85% probability that the fed funds rate will remain unchanged at the current level of 2.25%-2.50% this year. There is a 15% chance for a 25 basis point decline in 2019.

Currently, futures are caught between the bullish influence of a weakening global economy and the bearish influence of increased optimism for a U.S.-China trade agreement.

A U.S.-China trade deal, or strong hint of one, would be a catalyst to take futures lower.

 

SUPPORT AND RESISTANCE

June 19 S&P 500

Support    2781.00      Resistance    2803.00

 

March 19 U.S. Dollar Index

Support    96.750        Resistance    97.320

 

March 19 Euro Currency

Support    1.12410      Resistance    1.12980

 

March 19 Japanese Yen

Support    .89690       Resistance    .90110

 

March 19 Canadian Dollar

Support    .74430       Resistance    .74780

 

March 19 Australian Dollar

Support    .7050         Resistance    .7098

 

June 19 Thirty Year Treasury Bonds

Support    145^0        Resistance     146^2

 

April 19 Gold

Support    1290.0       Resistance    1304.0

 

May 19 Copper

Support    2.9000       Resistance    2.9650

 

April 19 Crude Oil

Support    56.55         Resistance    57.78


For more information about these markets, please contact Alan at 312.242.7911  or via email at alan.bush@admis.com. Thank you.

Would you like to open an account with us? Go to our interactive New Account application at Open an Account. It is fast, saves on postage and it’s green.

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.

Offers