The U.S. dollar is down for the third straight day and that has given oil prices a chance to recover after six straight declines. The dollar, as measured against the basket of currencies in the Bloomberg Dollar Spot Index, was down 0.42% today, as of 1:30 p.m. New York time Oil, on the other hand, has rallied today with the U.S. benchmark West Texas Intermediate up 2.75% to $47.48 a barrel
What had been up earlier this week was down today. U.S. stocks retreated with the Standard & Poor’s 500 stock index down 0.90% to move back below 2100 again. Emerging market stocks fell too with the iShares MSCI Emerging Markets ETF dropping 2.53%. Oil tumbled with U.S. benchmark West Texas Intermediate crude down 3.14% to $48.97 a barrel, below the closely watched $50 a barrel marker
There wasn’t much in the economic data today to make the financial markets reconsider their belief in the return of Goldilocks. Global growth numbers supported the view that key world economies will turn in decent performances. But none were so strong as to suggest putting higher interest rates from the Federal Reserve back on the schedule.
The U.S. economy added only a net 38,000 jobs in May, according to the jobs report from the Bureau of Labor Statistics this morning. Economists surveyed by Bloomberg had projected job gains of 90,000 to 215,000 with the median forecast at 160,000.
Welcome back to December! Remember when the financial markets thought the Federal Reserve was going to raise interest rates three times or maybe even four times in 2016 and suddenly bank stocks were the thing to own? At least until January when the sector went into a dumpster. Well, the positioning was back today–even if just for a day
Yesterday’s release of the minutes from the Federal Reserve’s April meeting has produced a massive change in market sentiment. Monday before release of the minutes financial markets were giving odds on a June interest rate increase of just 4%. After the meeting those odds soared and they continued to move up today to reach 26%.
Under some circumstances you’d expect a weak jobs number to send markets higher because it would signal that the Federal Reserve will put off the next interest rate increase. But not today. The Dow Jones Industrial Average was off slightly, by 0.07%, as of 11:30 a.m. New York time. The Standard & Poor’s 500 slipped 0.18%. That’s because markets have already priced in a one or none scenario for 2016.
After yesterday’s weaker than expected report on GDP growth, the Fed Funds futures market is giving odds of just 12% on a June interest rate increase. The odds of a June rate increase had been 21% after the Fed’s Wednesday meeting
At a speech in front of the Economic Club of New York today Federal Reserve Chair Janet Yellen pretty much quashed speculation that the Fed might raise interest rates at its April meeting. After such a strong reiteration of the Fed’s willingness to wait, the dollar fell, retreating 0.02% against the euro, and oil climbed
In the morning the U.S. dollar looked to be headed to a seventh day of gains, which would be the longest rally in the dollar since October. But while it finished up against the yen, it fell for the day against most major currencies
