S&P 500 futures are swinging between gains and losses in premarket trading as traders wait for the Fed Interest Rate Decision.
Most likely, the market will be unable to make any material moves before traders have a chance to see Fed’s commentary and economic projections.
Bond markets remain calm, and the yield of 10-year Treasuries has firmly settled below 1.50% which means that traders are not worried about inflation at this point. Meanwhile, the U.S. dollar is flat against a broad basket of currencies.
However, the situation may change quickly if the Fed hints that it is ready to think about discussing when it would be appropriate to reduce support to the economy. The Fed has previously stated that it will warn markets in advance to avoid panic, and traders will carefully watch for any signs that the Fed is less dovish.
Housing Starts Grew By 3.6% In May
U.S. has just released Building Permits and Housing Starts reports. Building Permits declined by 3% month-over-month in May compared to analyst forecast which called for growth of 0.9%. Housing Starts increased by 3.6% compared to analyst forecast of 2.5%.
It remains to be seen whether these reports will have any material impact on the market today as traders stay focused on the upcoming Fed Interest Rate Decision.
WTI Oil Managed To Settle Above The $72 Level
The rally in the oil market continues despite the recent sell-off in other commodities, and WTI oil managed to settle above the $72 level.
Oil traders stay focused on the robust rebound of oil demand and the significant support from OPEC+ deal, while the lack of progress in negotiations with Iran serves as an additional bullish catalyst.
Interestingly, oil-related stocks failed to develop significant upside momentum in recent trading sessions, although shares of oil majors have finally started to move higher.