Written Commentary
By Alan Bush
STOCK INDEX FUTURES
U.S. stock index futures are higher for a third consecutive day with the S&P 500 reaching its best level since March 6 and Dow futures at the highest level since March 9.
Some of today’s gains took place when the European Commission unveiled plans for an economic recovery fund worth 750 billion euros, or $826 billion.
In addition, investors are encouraged by news that the White House and Congress are considering more measures to address the unemployment situation. The Trump administration is examining proposals that will provide cash incentives to encourage unemployed workers to return to work.
It also looks like ongoing U.S.-China tensions are taking a back seat.
Mortgage applications to purchase a home increased 9.0% last week from the previous week, according to the Mortgage Bankers Association.
The 9:00 May Richmond Federal Reserve manufacturing index is expected to be negative 39.
The technical picture continues to improve for stock index futures.
CURRENCY FUTURES
The euro currency is higher after the European Commission unveiled plans for a large economic recovery fund. The announcement came after France and Germany opened the door to issuing mutual E.U. debt last week.
The Canadian dollar and the Australian dollar are lower in light of weaker crude oil prices.
INTEREST RATE MARKET FUTURES
U.S. Treasury yields edged up as optimism about economic recovery lifted equity markets and after the E.U., France, Germany and Japan all proposed new fiscal stimulus packages.
James Bullard of the Federal Reserve will speak at 11:30.
The Treasury will auction five-year notes today.
At 1:00 the Federal Reserve will release its “Beige Book” on the economy.
This book is produced approximately two weeks before the monetary policy meetings of the Federal Open Market Committee. On each occasion, a different Federal Reserve district bank compiles anecdotal evidence on the economic conditions from each of the 12 Federal Reserve districts.
The next Federal Open Market Committee meeting is scheduled for June 9-10. Currently there is a 97.1% probability that the FOMC will leave its fed funds rate unchanged at zero to 25 basis points.
In the weeks ahead it is likely that the yield curve will continue to steepen.
SUPPORT & RESISTANCE
June 20 S&P 500
Support 2980.00 Resistance 3042.00
June 20 U.S. Dollar Index
Support 98.650 Resistance 99.420
June 20 Euro Currency
Support 1.09300 Resistance 1.10400
June 20 Japanese Yen
Support .92620 Resistance .93200
June 20 Canadian Dollar
Support .72390 Resistance .72880
June 20 Australian Dollar
Support .6600 Resistance .6687
June 20 Thirty Year Treasury Bonds
Support 178^0 Resistance 179^16
June 20 Gold
Support 1680.0 Resistance 1711.0
July 20 Copper
Support 2.3800 Resistance 2.4250
July 20 Crude Oil
Support 33.21 Resistance 34.55
Risk Warning: Investments in Equities, Contracts for Difference (CFDs) in any instrument, Futures, Options, Derivatives and Foreign Exchange can fluctuate in value. Investors should therefore be aware that they may not realise the initial amount invested and may incur additional liabilities. These investments may be subject to above average financial risk of loss. Investors should consider their financial circumstances, investment experience and if it is appropriate to invest. If necessary, seek independent financial advice.
ADM Investor Services International Limited, registered in England No. 2547805, is authorised and regulated by the Financial Conduct Authority [FRN 148474] and is a member of the London Stock Exchange. Registered office: 3rd Floor, The Minster Building, 21 Mincing Lane, London EC3R 7AG.
A subsidiary of Archer Daniels Midland Company.
© 2021 ADM Investor Services International Limited.
Futures and options trading involve significant risk of loss and may not be suitable for everyone. Therefore, carefully consider whether such trading is suitable for you in light of your financial condition. The information and comments contained herein is provided by ADMIS and in no way should be construed to be information provided by ADM. The author of this report did not have a financial interest in any of the contracts discussed in this report at the time the report was prepared. The information provided is designed to assist in your analysis and evaluation of the futures and options markets. However, any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to ADMIS. Copyright ADM Investor Services, Inc.
