S&P 500 Poised Ahead of Jackson Hole Where Markets Await a Potential Powell Pivot

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S&P 500, US Dollar, Crude Oil, Natural Gas, Gold, NZD, AUD, CAD, Fed – Talking Points

  • The S&P 500 is unchanged in Asia because it nervously awaits Powell’s speech
  • APAC equities have been lifted by optimistic regulatory hopes whereas crude dipped
  • All eyes on Jackson Hole right this moment.What is the burden of phrases price for the S&P 500?

The S&P 500 held onto in a single day beneficial properties forward of the much-anticipated handle by Federal Reserve Chair Jerome Powell later right this moment.

The Dow Jones and Nasdaq additionally completed up on the day. Higher stock costs and narrowing company bond spreads are indicators of easing of financial situations.

This is the other of what the Fed is making an attempt to realize in its battle towards inflation. This locations vital emphasis on right this moment’s language from Powell.

Kansas City Federal Reserve President Ester George joined a number of different Fed board members in expressing hawkish views. She stated that the Fed funds fee may very well be effectively over 4% however received’t know that till the Fed sees the information indicators.

Chair Powell has been seen by the market because the least hawkish of Fed audio system of late. A change in tone from him may ignite volatility in lots of asset courses.

Reserve Bank of New Zealand (RBNZ) Governor Adrian Orr spoke to Bloomberg tv after the New York shut and gave a frank evaluation of the quandary central bankers are dealing with.

He stated that if central banks are doing their job in different components of the world, then consecutive quarters of damaging progress ought to be anticipated. He didn’t see that occuring for New Zealand although.

Nonetheless, the Kiwi slid decrease, dragging the Aussie and Loonie Dollars down with it and the US Dollar discovered help extra broadly to various levels. Gold is regular close to US$ 1,751 an oz..

USD/JPY yawned at Tokyo CPI coming in above expectations for August. Year-on-year core CPI was 2.6% as an alternative of 2.5% anticipated. The Tokyo CPI quantity supplies perception into the nationwide CPI determine that’s due in 3-weeks’ time.

Crude oil slipped decrease within the US session however has recovered some floor by way of Asia with the WTI futures contract close to US$ 93.50 bbl, whereas the Brent contract is again above US$ 100 bbl.

The European benchmark Dutch Title Transfer Facility (TTF) pure fuel futures contract has continued increased, buying and selling above 320 Euro per Mega Watt hour (MWh) towards the June low of 80 Euro per MWh. EUR/USD is little modified to this point right this moment.

APAC equities are all within the inexperienced and US equity futures are pointing to a flat begin to the North (*500*) buying and selling day.

Chinese shares had been underpinned by hypothesis that delisting threat within the US could be diminished. It is believed that Chinese corporations might want to convey their accounts to Hong Kong the place US regulators will overview them.

While the PCE knowledge out later right this moment would possibly acquire some consideration, the main target for markets shall be on Fed Chair Jerome Powell’s speech at 1400 GMT right this moment.

The full financial calendar may be seen right here.

S&P 500 TECHNICAL ANALYSIS

The S&P 500 failed to interrupt above a descending development line final week and it might proceed to supply resistance, at present close to 4310.

Above it, the 61.8%Fibonacci Retracement of the transfer from 4808 right down to 3639 may provide resistance at 4361.

On the draw back, help could be on the latest lows of 4110 and 4080.

Chart created in TradingView

— Written by Daniel McCarthy, Strategist for DailyFX.com

To contact Daniel, use the feedback part under or @DanMcCathyFX on Twitter





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