Written Commentary
CURRENCY FUTURES
The U.S. dollar index was higher in the overnight trade, and there were additional gains when the smaller than estimated jobless claims number was reported.
Interest rate differentials remain supportive to the greenback.
The Japanese yen was sold today in response to comments from the deputy governor of the Bank of Japan when he said the central bank was “unlikely to raise interest rates aggressively, even after ending its negative interest rate policy.”
STOCK INDEX FUTURES
Jobless claims in the week ended February 3 were 218,000 when 222,000 were expected.
The 9:00 central time December wholesale inventories report is anticipated to show a 0.4% increase.
The fundamentals and technicals remain supportive to stock index futures.
INTEREST RATE MARKET FUTURES
Futures came under pressure when the smaller than predicted jobless claims report was released. Most of the selling came into futures at the long end of the curve.
The Treasury will auction 30-year bonds today.
Financial futures markets are predicting there is a 16% probability that the Federal Open Market Committee will lower its fed funds rate by 25 basis points at the March 20 meeting and an 84% chance that the Fed will keep rates unchanged.
The fundamentals and technicals are not encouraging for the bull camp.
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