Written Commentary
STOCK INDEX FUTURES
Stock index futures are higher, although they came off their highs when the weaker than expected retail sales report was released.
Retail sales in April unexpectedly stalled, coming in at unchanged when a 1.0% increase was expected.
April industrial production increased 0.7% when up 1.2% was anticipated and capacity utilization was 74.9% when 75.2% was predicted.
The 9:00 central time May consumer sentiment index is estimated to be 90.3 and the 9:00 March business inventories report is expected to show a 0.3% increase.
Stock index futures are performing well on the news.
CURRENCY FUTURES
Yesterday the U.S. dollar index futures could only close steady in spite of the bullish larger than expected producer price index. The greenback is lower today in reaction to the weaker than anticipated retail sales report.
In spite of the larger than expected increases in consumer price and producer price indexes, Federal Reserve officials have persistently played down inflation risks, saying they are transitory. These comments tended to exert downward pressure on the greenback.
INTEREST RATE MARKET FUTURES
Futures advanced yesterday despite news that the producer price index increased more than expected.
There are follow-through gains today that were inspired by the unchanged retail sales report.
Robert Kaplan of the Federal Reserve will speak at 12:00.
GOLD AND SILVER FUTURES
Most major central banks will probably keep their accommodation for longer, which remains a bullish longer term influence on the precious metals.
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