Stocks Buoyant Ahead of the Fed – Nasdaq up 0.7%
US stock markets closed the trading day at yearly highs yesterday ahead of the crucial last Fed rate call of the year. All three of Wall Street’s major indexes closed at their highest levels for 2023 despite inflation numbers coming in slightly higher than expected, the Dow added 0.48% on the day, the S&P gained 0.46% and the Nasdaq rose 0.7% to finish above 14,500. US treasury yields dropped lower with the benchmark 10-year settling at 5.215% and the dollar fell against the majors, the index losing 0.2% on the day. Gold lost ground again against the dollar, now trading under $1,980/oz and Oil dropped further on continued demand concerns.
Oil Drops Another 3% as Black Gold Loses its Luster
Oil prices took another hit yesterday dropping another 3% as demand and oversupply concerns continue to weigh on the black gold. Prices hit their lowest levels for six months as US CPI data indicated that the Fed will not be looking to cut rates anytime soon and traders continue to fear that OPEC+ cuts will not be large enough to counteract decreasing demand across the globe. From a technical perspective, WTI is now sitting just above multi-month lows, but a clean break though these levels opens the way for prices to challenge the yearly lows just above the $63 level. Investors are now awaiting the fall out from today’s Federal Reserve meeting conclusion, but traders are still looking for more levels to sell at in the current environment.
More Data Ahead of the Fed
It is set to be another busy day for financial market participants today with the much-awaited Federal Reserve rate decision coming at the end of the New York session. However, before we get to the Fed there is still some tier 1 data for the market to negotiate. The Asian session has little on the schedule with the New Zealand Current account data having already hit the market slight under expectations, but the European session see’s the latest release of UK GDP data which should keep sterling traders on their toes. There is more inflation data out in the US Day in the form of the monthly PPI numbers with expectations for a 0.2% increase priced in for the Core number. But the big event comes towards the end of the session with Jerome Powell announcing the rate decision alongside the Statement and press conference.
