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What you need to know before trading futures on Jan. 30th:
By Mark O’Brien, Senior Broker
General:
Going into the fed’s meeting this month, financial markets widely expected the central bank to hold interest rates steady, breaking a streak of three consecutive rate cuts. Pointing to stubborn inflation readings and an economy hardly in need of rescuing, the Fed. did just that: nothing. “We feel like we don’t need to be in a hurry to make any adjustments,” Fed Chairman Jerome Powell said. The Fed’s policymaking committee voted unanimously to maintain their target for the federal-funds rate today, at a range of 4.25%-4.5%. The FOMC announcement noted unemployment “has stabilized at a low level” and “inflation remains somewhat elevated,” which noticeably removed a reference from its prior rate decision of inflation making “progress” toward the 2% target. Inflation has remained above the Fed’s 2% target for 45 consecutive months and counting.
Stock Indexes:
Stock index futures started oscillating immediately after the fed announcement at 1:00 Central Time, and through Fed chairman Jerome Powell’s 1:30 press conference with the March E-mini S&P 500 trading to daily contract lows just shy of 6040.00 between those events then swinging up over 40 points above 6080 within 30 minutes.
Energy:
Oil prices fell today, with the U.S. benchmark West Texas Intermediate touching a multi-week low after today’s weekly API report showed crude stockpiles rose more than expected last week.
The March crude oil futures contract fell to $72.33 a barrel intraday today, a ±$7.00 per barrel / $7,000 per contract move over just nine trading sessions and the lowest level since Jan. 2.
Grains:
Tightening global corn supplies have had investors’ attention for months and March corn futures have steadily made a bullish move. Today’s intraday high of $4.97½ per bushel marks a ±80-cent gain since its $4.14 intraday low back on Oct. 17.
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