S&P 500 futures are little changed in premarket trading as traders stay cautious ahead of the Fed Interest Rate announcement and the subsequent commentary.
It’s a big day on the earnings front, and major companies like Apple, Microsoft and Boeing have already announced their results before the market open or yesterday, after the market close.
However, earnings reports from leading companies had little impact on the direction of the general market today as the Fed meeting serves as the main catalyst during the current trading session.
Most likely, trading will remain choppy until Fed announces its decision (the rate will stay unchanged) and commentary, which may have a major impact on today’s trading.
Treasury Yields Rebound Ahead Of Fed Interest Rate Decision
The yield of 10-year Treasuries has managed to get back above 1.25% and is moving towards the 1.30% level. Meanwhile, U.S. dollar is also moving higher.
The U.S. Dollar Index, which measures the strength of the U.S. dollar against a broad basket of currencies, has managed to get back above 92.50 and is heading towards the resistance at 92.80.
Interestingly, higher yields and stronger dollar have failed to put any pressure on precious metals. Silver rebounds after yesterday’s sell-off while gold remains stuck near the key $1800 level.
WTI Oil Moves Higher Despite Virus Worries
Recent data suggests that another wave of coronavirus is gaining strength in the U.S. and globally, but oil traders stay calm as they bet that the new virus wave will not bring significant restrictions.
Stock traders are less optimistic, and the shares of energy-related companies are trading well below highs that were reached at the beginning of June.
Yesterday, API Crude Oil Stock Change report indicated that crude inventories declined by 4.73 million barrels compared to analyst consensus which called for a decline of 3.43 million barrels.
Today, traders will focus on EIA Weekly Petroleum Status Report. If EIA data confirms API numbers, oil may get more support, which will be bullish for oil-related stocks.