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PPI Increases Less Than Expected


September S&P 500 futures advanced above a double top pattern yesterday.

Stock index futures were higher the overnight trade as corporate earnings season kicks off.

There was additional support for futures when the June producer price index report showed an increase of 0.1% when up 0.2% was expected.

Jobless claims in the week ended July 8 were 237,000 when 249,000 were anticipated.

Many analysts continue to lean to the bearish side, which from a contrarian point of view suggests higher prices, at least in the short term.


The U.S. dollar index fell to its lowest level since April 2022.

Industrial production in the euro area increased 0.2% month-over-month in May 2023, easing from a 1.0% increase the month prior and slightly missing market expectations of 0.3% growth.

The U.K. economy contracted 0.1% month-over-month in May 2023, following 0.2% growth in April and compared to forecasts of a 0.3% decline.

Yesterday the Bank of Canada raised its overnight interest rate by 25 basis to 5.00% from 4.75%, which is a new 22-year high. Canada’s central bank said the path toward its 2.0% inflation target would take longer than planned.


Futures are higher in response to today’s bullish producer price index report.

Christopher Waller of the Federal Reserve will speak at 5:45 central time this afternoon.

The Treasury will auction 30-year bonds.

Financial futures markets are predicting there is a 92% probability that the Federal Open Market Committee will hike its fed funds rate by 25 basis points at the July 26 meeting, and there is an 8% chance that the fed funds rate will remain unchanged.

Traders are becoming increasingly confident that the end of the Fed’s tightening cycle is close.


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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 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.

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