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Lower U.S. Dollar a Good Sign International Funding Needs are Being Met

by Archer Financial Services | Mar 24, 2020

By Alan Bush | Senior Financial Economist at ADMIS   
 

 
STOCK INDEX FUTURES

U.S. stock index futures were limit up in the overnight trade due to optimism that Congress will soon pass a virus rescue bill.
Overseas equity markets are also higher with the German DAX up 6.5%.
The 8:45 central time March PMI composite is expected to be 45.1.
The 9:00 February new home sales report is anticipated to be 750,000 and the 9:00 Richmond Federal Reserve index is estimated to be negative 10.
After ignoring weeks of various stimulus plans from central banks, stock index futures are finally positively responding, which is very encouraging.

CURRENCY FUTURES

The U.S. dollar is lower after surging in recent weeks due to flight to quality buying and international demand for U.S. dollars.
A weakening greenback is an encouraging sign that international funding needs are being met.
Keep a close watch on the U.S. dollar since it is the bellwether indicator for the state of the global financial outlook.

INTEREST RATE MARKET FUTURES

Yesterday the Federal Reserve announced an unlimited quantitative easing program, which appears to be having the desired impact on financial markets.
The Treasury will auction two year notes today.

GOLD

Gold is sharply higher and is back to being a  safe haven asset again. Recently gold and many other assets were sold to raise cash. Now these assets don’t need to be liquidated, since the Federal Reserve has stepped into this roll by adding sufficient liquidity to the international banking system.



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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