Written Commentary
STOCK INDEX FUTURES
Stock index futures are lower due to weak guidance from another chipmaker in light of macro headwinds and supply chain bottlenecks.
Some traders are reluctant to open new positions ahead of the U.S. consumer price index report on Wednesday.
The July National Federation of Independent Business small business optimism index edged higher to 89.9 in July but was still close to a 9-1/2-year low of 89.5 hit in June.
Corporate earnings remain in focus with the second-quarter reporting period more than halfway completed. Approximately 78% of reports have beaten expectations, which is above the long-term average.
Despite an ongoing hawkish tone to Federal Reserve officials’ comments, stock index futures are holding up well.
CURRENCY FUTURES
The Swiss franc is approaching a three-month high due to a hawkish Swiss National Bank. There is speculation that policymakers are considering a 50 to 75 basis point rate hike at the central bank’s next policy meeting.
The Australian dollar is lower on news that the Australian consumer confidence index fell 3.0% in August from July.
INTEREST RATE MARKET FUTURES
The Treasury will auction three-year notes.
The inverted Treasury yield curve continues to flash warnings of economic risks.
According to financial futures markets, there is a 28.5% probability that the Federal Open Market Committee will hike its fed funds rate by 50 basis points and a 71.5% probability that the rate will increase by 75 basis points at the September 21 policy meeting.
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 information and comments contained herein is provided by ADMIS and in no way should be construed to be information provided by ADM. The author of this report did not have a financial interest in any of the contracts discussed in this report at the time the report was prepared. 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.
