Breaking News
Investing Pro 0
NEW! Get Actionable Insights with InvestingPro+ Try 7 Days Free

Opening Bell: U.S. Futures Retake 3,000 Milestone As Powell Backs Looser Policy

By (Pinchas Cohen/ OverviewJul 11, 2019 06:43
Opening Bell: U.S. Futures Retake 3,000 Milestone As Powell Backs Looser Policy
By (Pinchas Cohen/   |  Jul 11, 2019 06:43
Saved. See Saved Items.
This article has already been saved in your Saved Items
  • Global stocks, U.S. futures edge higher after Fed chair reinforces rate cut outlook
  • SPX contracts set to push equities back above 3,000 landmark
  • Yields dip toward multi-year lows; dollar extends a fall
  • Bitcoin plummets on Powell's warnings against Facebook's Libra
  • Oil builds on 7-week high amid hurricane, reports of Iran Persian Gulf move

Key Events

Futures on the S&P 500, Dow and NASDAQ 100 and Treasury rallied alongside global equities this morning on renewed optimism that the Fed will join other global central banks in easing monetary policy.

SPX contracts in particular suggested the underlying benchmark may open above the 3,000 psychological round number. The S&P 500 hit a fresh all-time high on Wednesday—but ultimately failed to hold on to the milestone—after Chairman Jerome Powell signaled the Fed’s recent dovish tilt remains on track despite last week's strong employment numbers. Powell cited trade uncertainties and slowing growth as an ongoing drag on the economy—thereby dispelling the market's narrative, including ours, that June’s robust jobs growth would dent the outlook for lower interest rates.

S&P 500 Weekly Chart
S&P 500 Weekly Chart

While futures look set to pull the SPX back above that key level, investors should bear in mind that after equities hit the 2000 milestone in 2014, they then moved sideways for two years.

Stoxx 600 Index Daily Chart
Stoxx 600 Index Daily Chart

Europe's STOXX 600 was pushed higher by energy companies tracking an oil advance. Technically, the price rose for the first time in five days, rebounding after yesterday’s bullish inverted hammer. If the price continues to climb above Wednesday’s 389.37 high, it would return to the ascending channel since June 3. Meanwhile, the recent rout pulled the 50 DMA below the 100 DMA. Although the July 4 peak posted a new high—on thin, U.S. holiday volume—above April 24’s 399.22 high, it failed to convincingly push higher. If prices resume trading along this ascending channel, it would make that a more long-lasting high.

In the earlier Asian session, regional markets flashed green across the board. South Korea’s KOSPI (+1.06%) climbed for the second day, outperforming even as tensions between Japan and South Korea—which have been responsible for the index's previous slide—reached a new peak amid heightened risk of disruption in the memory chips market.

Global Financial Affairs

The yield on 10-year Treasurys slid for the second day on Powell’s dovish reiteration, nearing the 50 DMA as investors bought into current rates anticipating lower returns down the line. However, it's important to gauge for how long equities can keep breaking records while yields fall toward multi-year lows.

DXY Daily Chart
DXY Daily Chart

The dollar also fell for a second consecutive session, slipping again below its medium-term uptrend line since September 2018 and into the short-term descending channel since May 2019's high. However, from a technical standpoint, the price is still on the nexus between the medium and short term—marked by the X in the chart above—and the 200 DMA below 97.00 may prove a support.

The outlook for a weakening USD due to lower rates boosted gold, as it pulled up the RSI from a H&S top, threatening a blowout.

Powell's testimony to Congress also sent shockwaves through the crypto market as he voiced “serious concerns” about Facebook’s (NASDAQ:FB) planned digital coin Libra, citing "privacy, money laundering, consumer protection and financial stability" risks. Bitcoin extended a rout to the second day after falling 12% on the Fed chairman's remarks. The RSI is about to provide a negative divergence.

WTI Daily Chart
WTI Daily Chart

Meanwhile, WTI kept rallying after sealing a seven-week high close yesterday ahead of a hurricane in the Gulf of Mexico. Tightening U.S. supplies and mounting tensions between Iran and the U.K.—with the former reportedly attempting to seize a British oil tanker in the Persian Gulf—propped up prices.

Up Ahead

  • Canadian New Housing Price Index for May is released Thursday.

  • Federal Reserve Chairman Jerome Powell's testimony on monetary policy and the state of the U.S. economy continues before Senate today.
  • ECB minutes come out on Thursday.
  • The core consumer price index, a key measure of U.S. inflation also coming out on Thursday, is expected to have increased 0.2% in June from the prior month, while the broader CPI is forecast to remain unchanged.
  • U.S. producer prices come out on Friday.

Market Moves



  • The Canadian loonie was up 0.05 percent against the U.S. greenback early Thursday, trading at 0.7648.

  • The Dollar Index dropped 0.2%, extending the Powell fallout to 0.6%
  • The euro rose 0.2% to $1.1269, the strongest in a week.
  • The British pound increased 0.2% to $1.2531, the strongest in a week.
  • The Japanese yen gained 0.4% to 108.08 per dollar, the strongest in a week.


  • Canada’s 10-year yield was down early Thursday at 1.584, a 0.13-percent increase.

  • The yield on 10-year Treasurys declined one basis point to 2.05%, the largest fall in more than a week.
  • Germany’s 10-year yield increased four basis points to -0.26%, the highest in more than three weeks.
  • Britain’s 10-year yield fell less than one basis point to 0.755%.


  • West Texas Intermediate crude climbed 0.4% to $60.65 a barrel, reaching the highest in seven weeks.
  • Gold rose 0.2% to $1,421.95 an ounce, the highest in more than two weeks.
  • Iron ore dipped 1.1% to $113.35 per metric ton.
Opening Bell: U.S. Futures Retake 3,000 Milestone As Powell Backs Looser Policy

Related Articles

FactSet Research Systems Inc
Podcast : Financial Market Preview - Monday 23-May By FactSet Research Systems Inc - May 23, 2022

US equity futures are indicating a higher open as of 05:00 ET. Asian equities traded mixed to higher on Monday. European equity markets are largely higher. Latest news on the China...

Opening Bell: U.S. Futures Retake 3,000 Milestone As Powell Backs Looser Policy

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at’s discretion.

Write your thoughts here
Are you sure you want to delete this chart?
Post also to:
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Are you sure you want to delete this chart?
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Our Apps
© 2007-2022 Fusion Media Limited. All Rights Reserved.
Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
  • Sign up for FREE and get:
  • Real-Time Alerts
  • Advanced Portfolio Features
  • Personalized Charts
  • Fully-Synced App
Continue with Google
Sign up with Email