Morning Express
Posted: June 14, 2023, 7:43 a.m.
Our daily research overs the S&P, NQ, Crude Oil, Gold, Silver, Currencies, Corn, Soybeans, Wheat, Livestock, and Softs markets.
Went out to brokerage clients before the bell
- PPI for May is due at 7:30 am CT and expectations are for:
- Headline at -0.1% m/m, disinflating after +0.2% in April, and +1.5% y/y, down from 2.3%.
- Core at +0.2% m/m, unchanged from +0.2% in April, and +2.9% y/y, down from 3.2%.
- The disinflating trend is clear, producer prices are coming down, and are a leading indicator of consumer prices.
- It is Fed Day, and the bank will announce a policy decision at 1:00 pm CT.
- Quarterly economic projections along with the dot plot will be released.
- According to the CME Fed Watch Tool, there is only a 4.7% probability the Fed hikes by 25bps, but there is a 66.1% probability they hike another 25bps by the July 26th
- Fed Chair Powell’s press conference begins at 1:30 pm CT.
- Tonight, a deluge of economic data from China is due at 9:00 pm CT and includes Industrial Production, Fixed Asset Investment, Retail Sales, and Unemployment Rate.
E-mini S&P (September) / E-mini NQ (September)
S&P, yesterday’s close: Settled at 4416.75, up 28.75
NQ, last week’s close: Settled at 15,099, up 112.25
The E-mini S&P is now in full breakout mode heading into today’s Fed policy decision. The real question is whether the Fed uses the recent froth as a reason to surprise markets with a hike today. For this reason, traders must be extremely nimble into the afternoon from a fundamental perspective. However, technically, all systems are a go as long as price action in the E-mini S&P and E-mini NQ stay above first key supports at...
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Crude Oil (July)
Yesterday’s close: Settled at 69.42, up 2.30
Crude Oil’s rebound briefly extended above rare major four-star resistance at 69.95-70.17. This mark will be critical on a closing basis and will help signal whether Monday’s fallout has been repaired. Weekly EIA inventory data is due at 9:30 am CT and expectations are for +1.482 mb Crude, +0.637 mb Gasoline, and +0.922 mb Distillates. Remember, Net Imports, SPR, and Refinery Utilization will play a key role in understanding the report. Tonight’s slate of data from China will also be crucial and released at 9:00 pm CT. As today unfolds, the bulls can regain near-term control by defending major three support at...
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Gold (August) / Silver (July)
Gold, yesterday’s close: Settled at 1958.6, down 11.1
Silver, yesterday's close: Settled at 23.822, down 0.237
Gold and Silver were bludgeoned following a softer than expected headline CPI report. Although Core CPI was in line with expectations it alone would not have called for the precious metals selling. However, we see this as slower inflation calling for less tightening from the Federal Reserve, which will lead to a better economy and less likeliness for rate cuts into next year. The line in the sand support in Gold stands at major three-star support at...
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Silver (July)
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