Yesterday's Release of FOMC Minutes from September Meeting Were Hawkish
Alan Bush of ADM Investor Services - InsideFutures.com - Thu Oct 18, 9:01AM CDT

October 18, 2018

STOCK INDEX FUTURES

U.S. stock index futures are lower after yesterdays release of the minutes of the Federal Reserves September 25-26 policy meeting, which were more hawkish than analysts expected. Policymakers agreed on the need to hike interest rates further.

Initial jobless claims decreased by 5,000 to a seasonally adjusted 210,000 in the week ended October 13, which matched expectations.

The Philadelphia Federal Reserves manufacturing business outlook survey was 22.2 in October, which compares to consensus expectations for a reading of 20.

The 9:00 central time September leading indicators report is expected to show a .5% increase.

Earnings at S&P 500 companies in the third quarter are expected to have increased almost 22% in the quarter. Of the 51 companies that have reported results so far, 84.3% have beaten analysts expectations.

The still relatively low interest rate environment and, in my opinion a likely less hawkish Federal Open Market Committee next year, suggests recent weakness is a correction and we have not seen the top for stock index futures.

CURRENCY FUTURES

The U.S. dollar is higher after yesterdays release of the minutes of last months Federal Open Market Committee meeting were more hawkish than analysts expected.

The British pound is lower after a report showed U.K. retail sales fell in September. The Office for National Statistics said retail sales declined 0.8% on the month in September, which was the third straight decline.

The Canada dollar is lower due to lower crude oil prices and in spite of a report that showed employment in Canada increased by 28,800 jobs in September.

INTEREST RATE MARKET FUTURES

The minutes of the Federal Open Market Committees September policy meeting pressured futures yesterday afternoon and also today.

According to the financial futures markets, the probability of a fed funds rate hike at the Federal Open Market Committees December 19 policy meeting is 84%, which compares to 80% yesterday.

The long term trend for the interest rate futures is lower.

SUPPORT AND RESISTANCE

December 18 S&P 500

Support 2792.00 Resistance 2818.00

December 18 U.S. Dollar Index

Support 95.150 Resistance 95.580

December 18 Euro Currency

Support 1.15230 Resistance 1.15850

December 18 Japanese Yen

Support .89030 Resistance .89340

December 18 Canadian Dollar

Support .76610 Resistance .76960

December 18 Australian Dollar

Support .7102 Resistance .7165

December 18 Thirty Year Treasury Bonds

Support 137^8 Resistance 137^30

December 18 Gold

Support 1221.0Resistance 1233.0

December 18 Copper

Support 2.7200 Resistance 2.7900

December 18 Crude Oil

Support 68.21 Resistance 70.25

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