S&P 500 futures are moving higher in premarket trading as traders rush to buy stocks after the long weekend.
In Europe, the final reading of the Manufacturing PMI report for May beat analyst expectations as Manufacturing PMI increased from 62.9 to 63.1 compared to analyst consensus of 62.8. Inflation Rate grew by 0.9% year-over-year in May compared to analyst consensus which called for growth of 0.8%. The reports highlighted the recovery in the hard-hit European economy and boosted global market mood.
In the U.S., bond traders look a bit worried about rising inflation as Treasury yields are moving higher. The yield of 10-year Treasuries is currently trying to settle above the 20 EMA at 1.61%. Interestingly, higher yields did not put pressure on tech stocks, and Nasdaq futures are up by about 0.5% in premarket trading.
WTI Oil Gets To Yearly Highs
WTI oil gained strong upside momentum and moved to yearly highs as traders bet that the strong rebound of the world economy would offset additional supply from Iran in case U.S. and Iran reach consensus on the Iran nuclear deal. In addition, it is unclear if such a deal could be crafted in the near term.
Today, OPEC+ will discuss its production cuts at a regular monthly meeting. No surprises are expected, and the market believes that OPEC+ will continue to gradually increase oil production.
Some reports indicated that Russia wanted to increase its production at a faster pace, but it remains to be seen whether Saudi Arabia will be happy with such proposal.
Silver Tests Resistance At $28.30
Higher yields failed to put any pressure on precious metals today which is bullish for silver and gold mining stocks. Silver is currently trying to settle above the resistance at $28.30 while gold continues its attempts to settle above $1900.
It looks that some investors and traders remain worried about inflation despite recent comments from Fed officials, which is bullish for precious metals. I’d note that crypto markets are under some pressure today, which is a welcome development for gold bulls.