Equities rise following the FOMC

Published date: 20/06/2019

Last night the Fed opened the door to a rate cut as early as next month after removing the word "patient" from their statement. Rates remained unchanged at this meeting but now the futures market are pricing in a cut next month. In a reaction to the news the 3 major US bourses all closed higher with the Nasdaq outperforming up 0.42%. Over in the Asia Pac area, It was much of the same as Japan's Nikkei 225 rose 0.60%, Australia's ASX jumped 0.59% and China's Shanghai Comp. moved 2.34% higher respectively. Elsewhere in trade news, the US and China are set to meet for trade talks on June 29th in Japan. President Trump and China's Xi will sit down to try and work out a deal as international pressure mounts.

In commodities news, gold has smashed through its consolidation high of $1375/oz. In the wake of the FOMC meeting yesterday the yellow metal hit a high of $1393.93/oz. It seems safe haven flows are preferring the precious metal over debt markets.

Copper also had a good session after continuing to move higher to break $2.70/lb once again. Most of these moves are in relation to USD weakness but the news of the Trump-Xi trade talks must of helped. 

Oil has a great session too and to round off the general strength in commodities there was also a draw in DoE's yesterday. The report showed a draw of 3.106mln vs the expected draw of 1.077mln. 

Today we are on the lookout for BoE rate decision, UK retail sales, US Philly Fed data and comments from BoE's Carney, ECB's de Guindos and ECB's Rehn.


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