U.S. has just released GDP Growth Rate report for the third quarter. The report indicated that GDP increased by 2% on a quarter-over-quarter basis while analysts expected that it would grow by 2.7%.
Initial Jobless Claims report showed that 281,000 Americans filed for unemployment benefits in a week compared to analyst consensus of 290,000. Continuing Jobless Claims declined from 2.48 million to 2.24 million.
S&P 500 futures are gaining ground in premarket trading despite the disappointing GDP Growth Rate report as traders rush to buy stocks after the minor pullback.
Today, traders will also have a chance to take a look at Pending Home Sales report for September. The report is expected to show that Pending Home Sales declined by 7% on a year-over-year basis.
Treasury Yields Remain In Focus Ahead Of Fed Meeting
The yield of 2-year Treasuries has recently made an attempt to settle above 0.55% as traders remained worried about inflation and the potential reduction of Fed’s asset purchase program. Meanwhile, the yield of 10-year Treasuries remains under pressure and is trying to settle below 1.54%.
Bond traders bet that Fed will have to raise rates sooner than previously expected, so they sell shorter-term Treasuries. At the same time, they believe that the Fed will be successful in the battle against inflation in the longer-term, so they purchase longer-term Treasuries, pushing their yields lower.
At this point, the recent action in bond markets had minimal impact on stocks, but it’s a story to be watched closely ahead of the important Fed meeting which will take place next week.
WTI Oil Remains Under Pressure Amid Progress In Iran Negotiations
WTI oil made an attempt to settle below the $81 level after reports indicated that Iran and EU would return to the negotiation table by the end of the next month.
In addition, yesterday’s EIA Weekly Petroleum Status Report indicated that crude inventories increased by 4.3 million barrels, which was also bearish for oil. U.S. domestic oil production remained unchanged at 11.3 million barrels per day (bpd).
Oil-related stocks were under pressure during yesterday’s trading session, and more pressure should be expected at the start of today’s trading session.