Written Commentary
STOCK INDEX FUTURES
U.S. stock index futures are lower due to dampening hopes of a rapid economic recovery.
Also weighing on stock index futures was yesterday’s news that the U.S. is considering imposing tariffs on $3.1 billion worth of products from the U.K., France, Germany and Spain.
Jobless claims in the week ended June 20 were 1,480,000 when 1,380,000 were expected.
The first quarter final gross domestic product report showed a 5.0% decline, as anticipated.
Durable goods orders in May were up 15.8% when a gain of 10.0% was estimated.
The 10:00 central time June Kansas City Federal Reserve manufacturing index is predicted to be negative 9.
Stock index futures will be supported by the belief that any slowdown in the global economic recovery will be met with additional accommodation from the world’s central banks along with more fiscal stimulus internationally.
CURRENCY FUTURES
The U.S. dollar is higher with safe-haven demand supporting the greenback after it was reported yesterday that the U.S. was considering tariffs on exports from Britain, France, Spain and Germany.
The euro currency is lower despite news that German consumer sentiment is likely to rise in July, according a market research group.
Interest rate differential expectations have recently turned slightly more favorable to the U.S. dollar.
INTEREST RATE MARKET FUTURES
Federal Reserve speakers today are Robert Kaplan at 8:30, Raphael Bostic at 10:00 and Loretta Mester at 11:00.
The Treasury will auction seven-year notes today.
In keeping with the global trend of central banks adding accommodation, the Philippine central bank cut its benchmark interest rates to offer additional support for the economy.
According to financial futures markets there is a 97.8% probability that the Federal Open Market Committee will leave its fed funds rate unchanged at zero to 25 basis points at its July 29 policy meeting.
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