Written Commentary
STOCK INDEX FUTURES
Stock index futures are higher on Tuesday, as investors take a breather after a two-day slide prompted by Fed Chair Powell’s hawkish remarks at the Jackson Hole Symposium on Friday. Powell said the central bank will continue to raise interest rates to fight inflation despite a slowing economy.
The 9:00 central time August consumer confidence index is expected to be 97.4.
The 9:00 July Job Openings and Labor Turnover Survey (JOLTS) is anticipated to be 10.4 million. The Labor Department’s JOLTS report tracks the monthly change in job openings and offers rates on hiring and quits.
CURRENCY FUTURES
The U.S. dollar pulled back from fresh 20-year highs that were made yesterday.
The long term trend for the U.S. dollar is higher as interest rate differential expectations remain bullish.
The economic sentiment indicator in the euro area fell to 97.6 in August of 2022 from a downwardly revised 98.9 in July, and slightly below market forecasts of 98. This is the lowest reading since February last year.
Japan’s jobless rate was steady at 2.6% in July, while the availability of jobs increased for the seventh straight month to a more than two-year high.
INTEREST RATE MARKET FUTURES
Thomas Barkin of the Federal Reserve today said the Fed is committed to do what is necessary to lower inflation.
John Williams of the Federal Reserve will speak at 10:00.
According to financial futures markets, there is a 31.5% probability that the Federal Open Market Committee will hike its fed funds rate by 50 basis points and a 68.5% probability that the rate will increase by 75 basis points at the September 21 policy meeting.
The inverted Treasury yield curve continues to flash warnings of economic risks ahead.
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