US premarket on October 5: US stock market on pause
October 5, 2023 2:26 pm
US stock index futures opened slightly lower on Thursday but then fully recovered. Futures on the S&P 500 were up 0.2%, while the high-tech NASDAQ added 0.3%. After a week of sharp market swings, investors will take a break today to properly prepare for key US employment data. 10-year Treasury yields fell by two basis points to 4.71%.
Investor sentiment remains volatile and this is reflected in the bond market where yields have risen to multi-year highs. Today’s weekly US unemployment claims data is no match for tomorrow’s employment report, which could bolster bets that the Fed would raise borrowing costs in November. Investors are currently pricing in a one-in-four chance that the Fed’s actions next month will lead to a quarter-point rate hike. In the monthly US labor market report, economists forecast that the US economy added 170,000 jobs in September, down slightly from the previous month.
All of this will have an impact on the 10-year Treasury yield, which could rise to 5% or fall to 4.5%.
Even as the markets show signs of calm, economists’ reports underscore deep concerns about the long-term economic impact of the rate hike cycle. Analysts at Barclays Plc said today that the global bond market was doomed to fall further unless a sustained downturn in equities restores the appeal of fixed-income assets. “There is no magic level of yields that, when reached, will automatically draw in enough buyers to spark a sustained bond rally,” they said in a note. “In the short term, we can think of one scenario where bonds rally materially. If risk assets fall sharply in the coming weeks.”
WTI crude has continued its correction and has already reached the $83 a barrel level, which may partially offset investor concerns about oversupply. Gold is also losing ground and has fallen to $1815 per ounce.
As for the S&P 500, demand for the index remains weak. Bulls will have to defend $4,229 and take control of $4,268 if they want to stop the bear market. After hitting that level, they can push the price to $4,304. In addition, they also should take control of $4,332 to restore the market balance. If the price declines on the back of diminishing risk appetite, bulls will have to protect $4,203. Breaking through this level, the trading instrument may drop to $4,175 and $4,143.
The material has been provided by InstaForex Company – www.instaforex.com
US stock index futures opened slightly lower on Thursday but then fully recovered. Futures on the S&P 500 were up 0.2%, while the high-tech NASDAQ added 0.3%. After a week of sharp market swings, investors will take a break today to properly prepare for key US employment data. 10-year Treasury yields fell by two basis points to 4.71%.
Investor sentiment remains volatile and this is reflected in the bond market where yields have risen to multi-year highs. Today’s weekly US unemployment claims data is no match for tomorrow’s employment report, which could bolster bets that the Fed would raise borrowing costs in November. Investors are currently pricing in a one-in-four chance that the Fed’s actions next month will lead to a quarter-point rate hike. In the monthly US labor market report, economists forecast that the US economy added 170,000 jobs in September, down slightly from the previous month.
All of this will have an impact on the 10-year Treasury yield, which could rise to 5% or fall to 4.5%.
Even as the markets show signs of calm, economists’ reports underscore deep concerns about the long-term economic impact of the rate hike cycle. Analysts at Barclays Plc said today that the global bond market was doomed to fall further unless a sustained downturn in equities restores the appeal of fixed-income assets. “There is no magic level of yields that, when reached, will automatically draw in enough buyers to spark a sustained bond rally,” they said in a note. “In the short term, we can think of one scenario where bonds rally materially. If risk assets fall sharply in the coming weeks.”
WTI crude has continued its correction and has already reached the $83 a barrel level, which may partially offset investor concerns about oversupply. Gold is also losing ground and has fallen to $1815 per ounce.
As for the S&P 500, demand for the index remains weak. Bulls will have to defend $4,229 and take control of $4,268 if they want to stop the bear market. After hitting that level, they can push the price to $4,304. In addition, they also should take control of $4,332 to restore the market balance. If the price declines on the back of diminishing risk appetite, bulls will have to protect $4,203. Breaking through this level, the trading instrument may drop to $4,175 and $4,143.
The material has been provided by InstaForex Company – www.instaforex.com
Related Posts: