U.S. Premarket for August 26: Another rally in the stock markets at the moment
What is a rally in the stock markets? U.S. stock index futures traded lower on Friday and Treasuries retreated from their highs as many U.S. policymakers began setting the stage for Chairman Jerome Powell’s highly anticipated speech. The Fed chief’s statements will help shape opinion on the pace of monetary policy tightening.
Rally in the stock markets at the moment
S&P 500 and Nasdaq 100 futures are down 0.2% and 0.3%, respectively. The yield on the 10-year Treasury note rose about five basis points to 3.08%. In addition to Powell’s speech later Friday, traders will take a look at a slew of fundamental statistics, including personal spending by citizens and the Fed’s preferred inflation gauge, which will record a decline in price pressure.
Mining stocks continued to rally in stocks Friday as prices of iron ore, copper and other industrial metals rose after China’s latest effort to stimulate its weakened economy.
Going back to Powell, who may confirm the Fed’s determination to keep raising interest rates to combat high inflation, it is not just the willingness to raise them, but also the pace of further tightening. Many experts are already claiming a hawkish scenario, rejecting expectations of moderate tightening.
This is the backdrop for the rebound in stocks and the decline in bonds. Another question is whether Powell will try to reset market expectations to make sure that economic activity slows further. Obviously, a dovish reversal would play well in the hands of buyers of risky assets who are looking forward to further stock market recovery.
But if the Fed backs off its targets now, the fight against inflation could drag on for years to come, and then the economy has a chance of not only slipping into recession, but everything spilling over into a full-blown crisis, starting with the housing market and ending with the labor market and stagnant manufacturing and services sectors. If Powell leaves any hope of a dovish reversal, we could see yields plummet and stock markets end the week at their highs.
Other central bankers have already stressed the need for further rate hikes. Kansas City Fed President Esther George said interest rates cannot be ruled out even above 4%.
Earlier we reported that major U.S. stock indexes are moderately rising in anticipation of the Fed’s decisions.
Wall Street futures rise after the U.S. Fed meeting
U.S. stock index futures are rising Thursday, trading data showed. Markets are assessing the outcome of the U.S. Federal Reserve (Fed) meeting.
The Dow Jones Industrial Average (DJIA) futures rose 0.22% to 32,329 points, the NASDAQ high-tech index rose 0.96% to 12,828.5 points and the S&P 500 broad market index rose 0.48% to 3,989.75 points.
The Fed on Wednesday expectedly raised its benchmark rate by 25 basis points to 4.75-5% per year. The regulator noted that it does not expect the rate reduction this year, but allows it next year. U.S. exchanges were down 1.6% in Wednesday trading.
According to the CME Group, 55.8% of analysts now expect the Fed’s discount rate to remain unchanged in May, while 44.2% expect it to rise another 25 basis points. Thus, markets concede that the Fed may interrupt the cycle of hikes that began last March.
At the same time, shares of cryptocurrency exchange Coinbase were down 10.6% in pre-bid trading. The exchange this week received notice from U.S. authorities of an impending charge of violating laws.
Later in the trading, statistics on initial jobless claims in the U.S. for the week through March 18 will be released. Analysts forecast that the figure would increase by 5 thousand to 197 thousand applications.
Earlier we reported that the US budget deficit was $262bn in February.
ITB (International Trading Brachium) Broker Announced Its YouTube channel
(Mahe, Seychelles-March 08, 2023) – ITB BROKER, LLC, an international forex broker, has announced that with our community growing, we believe that this will be the most effective medium to communicate with and so, we’re proud to announce the launch of ITB YouTube channel .
When a picture speaks a thousand words, How about a video?
- Throughout our community building initiative, we strongly believe in video as our means of communication. Video has played a pivotal role in describing our futuristic services to our audience and in communicating our disruptive vision to potential traders or investors.
- Over the next few weeks, we will be launching interesting videos on upcoming ITB features, bonuses, partnership or IB announcements and financial market expert interviews.
- YouTube is a great place to pick up forex trading tips and learn how to use them in the real world.
There are a number of YouTubers that make great educational videos, perfect for beginners or those considering taking up forex trading. ITB group with over 10 years of financial experience provides you with useful tips and hints of forex trading via its YouTube channel.
ITB Broker or ITBFX is a leading provider of online foreign exchange (FX) trading, CFD trading, and related services.
Founded in 2017, the company’s mission is to provide enthusiastic traders with access to the world’s largest and most liquid market by offering innovative trading tools, applying excellent trading platform, meeting strict financial standards, and striving for the best online trading experience in the market.
In addition, ITB offers educational courses on FX trading and Cryptocurrencies on academy section of ITBFX website.
U.S. budget deficit totaled $262 billion in February
According to a report from the U.S. Treasury Department, the U.S. budget deficit in February was $262,434 billion compared to a $38.8 billion deficit in January. The Dow 30 also had problems.
Analysts at DailyFX suggested that the nation’s budget deficit for February was expected to be $256 billion. A year earlier, in February, the U.S. posted a budget deficit of $216,590 billion.
According to the GAO report, U.S. government spending rose 3.5 percent year over year last month to $524.548 billion, while revenue, in contrast, declined 9.5 percent to $262,114 billion.
Earlier, the U.S. edition of the Washington Post published an editorial stating that the new draft budget proposed by the Biden administration undermines U.S. national security and its ability to invest in the future, because it suggests a further growth of the U.S. national debt.
The WP editorial board noted that the new draft budget assumes a $2 trillion budget deficit, including due to the high cost of providing health insurance to the elderly of the baby boomer generation.
Earlier we reported that the EU has agreed to reduce energy consumption by 11.7% by 2030.
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