By Alan Bush | Senior Financial Economist at ADMIS
S&P 500 and NASDAQ futures advanced to record highs today.
U.S. retail sales increased 0.4% in June from a month earlier, which compares to expectations of a 0.1% gain.
Prices for foreign-made goods imported to the U.S. declined 0.9% in June, which is the latest indication that inflationary pressures remain limited. Economists expected prices to fall 0.8%.
Industrial production in June was unchanged when a .1% increase was expected and capacity utilization in June was 77.9%, which compares to the anticipated 78.2%.
Two 9:00 central time reports are scheduled. May business inventories are expected to be up .4% and the July housing market index is anticipated to be 65.
Federal Reserve Chairman Jerome Powell will speak at 12:00.
My view remains that the global reflation scenario is on track and easier credit conditions from most of the world’s central banks, including the Federal Reserve, are coming and will be the dominant fundamental that supports stock index futures in the long term.
The U.S. dollar index advanced when the stronger than expected U.S. retail sales report was released.
The British pound fell to its lowest level against the U.S. dollar since June of 2017 due to Brexit uncertainties and increasing prospects of easier credit policies from the Bank of England.
The Australian dollar is lower after the Reserve Bank of Australia, in the minutes of its July 2 policy meeting, left open the prospect of additional interest rate cuts in coming months, if conditions in the labor market do not improve.
In addition to Fed Chair Powell, Federal Reserve speakers today are Atlanta Federal Reserve Bank President Raphael Bostic at 9:05, Dallas Federal Reserve Bank President Robert Kaplan at 11:20 and Chicago Federal Reserve Bank President Charles Evans at 2:30.
Financial futures markets are predicting there is almost a 100% probability that the Federal Open Market Committee will lower its fed funds rate by 25 basis points or more at its July 30-31 policy meeting. A second rate cut is anticipated by financial futures markets later this year.
I expect at least a partial price recovery now that the bearish U.S. retail sales report is out of the way.
September 19 S&P 500
Support 3009.00 Resistance 3027.00
September 19 U.S. Dollar Index
Support 96.500 Resistance 97.000
September 19 Euro Currency
Support 1.12580 Resistance 1.13240
September 19 Japanese Yen
Support .92800 Resistance .93230
September 19 Canadian Dollar
Support .76600 Resistance .76880
September 19 Australian Dollar
Support .7030 Resistance .7064
September 19 Thirty Year Treasury Bonds
Support 153^4 Resistance 154^12
August 19 Gold
Support 1408.0 Resistance 1423.0
September 19 Copper
Support 2.7000 Resistance 2.7300
August 19 Crude Oil
Support 59.07 Resistance 60.13
For more information about these markets, please contact Alan at 312.242.7911 or via email at firstname.lastname@example.org. 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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