Thirty Year Treasury Bonds Performing Better Than The News

STOCK INDEX FUTURES

S&P 500, Dow and NASDAQ futures advanced to record highs due to U.S.-China trade optimism in addition to the ongoing support from the globally relatively low interest rate environment.

Corporate earnings reports have been supportive, as well. With third quarter earnings season winding up, almost 75% of the S&P 500 companies that have reported results so far have topped profit estimates.

Housing starts in October were 1.314 million when economists expected starts would be 1.320 million and residential permits were 1.461 million, which compares to the anticipated 1.378 million permits.

My view remains that the global reflation scenario is on track and easier credit conditions, although likely at a much slower pace, from most of the worlds central banks are coming and will be the dominant fundamental that supports stock index futures through the balance of the year.

CURRENCY FUTURES

The U.S dollar is a little higher, as interest rate differential expectations remain slightly bullish on balance for the greenback.

The euro currency is steady to higher due to recent indications that the euro zone economy is stabilizing.

The British pound is lower after news that manufacturing output in the quarter to November continued to

decline, according to the latest monthly Confederation of British Industry trends survey.

The Canadian dollar is higher in spite of news that Canadian factory sales fell 0.2% in September from the previous month.

The Australian dollar is stronger despite news that the Reserve Bank of Australia is still prepared to ease credit conditions further, according to the policy meeting minutes from the November 5 meeting.

INTEREST RATE MARKET FUTURES

The thirty year Treasury bond futures are higher in spite of the bearish influence of the overall better than estimated housing numbers.

There are indications that the global economy is beginning to stabilize, which suggests major central banks are likely to push farther out into the future additional easing measures.

Financial futures markets are suggesting there is a 52% probability that the Federal Reserve will lower its fed funds rate by 25 basis points at its July 29, 2020 policy meeting.

Interest rate market futures are likely to trade only sideways, although the flight to quality influence is likely to reemerge from time to time.

SUPPORT AND RESISTANCE

December 19S&P 500

Support 3112.00 Resistance 3136.00

December 19 U.S. Dollar Index

Support 97.580 Resistance 97.830

December 19Euro Currency

Support 1.10675 Resistance 1.11080

December 19Japanese Yen

Support .92000 Resistance .92390

December 19Canadian Dollar

Support .75580 Resistance .75880

December 19Australian Dollar

Support .6780 Resistance .6845

December 19 Thirty Year Treasury Bonds

Support 158^12 Resistance 159^6

December 19Gold

Support 1462.0 Resistance 1478.0

December 19Copper

Support 2.6150 Resistance 2.6650

January 20 Crude Oil

Support 55.89 Resistance 57.35

Contact Alan for more extensive information on these markets at 312.242.7911 or via email at alan.bush@admis.com. Thank you.

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