S&P 500 E-Mini Futures Market News and Commentary
The S&P 500 ($SPX) this morning is up by +19.09 (+0.65%), the Dow Jones Industrials index ($DOWI) is up +181.90 (+0.69%), and the Nasdaq 100 Index ($IUXX) is up by +65.04 (+0.85%). U.S. stock indexes are moving higher this morning with the S&P 500 and the Dow Jones Industrials at new record highs and the Nasdaq 100 at a 1-1/2 month high. Stocks have extended Wednesday's gains on the Fed's dovish shift at Wednesday's FOMC meeting where the FOMC downgraded its assessment of economic activity to "moderate" from May's "solid" and removed its reference to being "patient" on interest rates, which bolsters the outlook for a rate cut at the July 30-31 FOMC meeting. In fact, fed fund futures are now discounting the odds at 100% for a 25 bp rate cut at next month's FOMC meeting. The outlook for lower short-term interest rates pushed the 10-year T-note yield down to a 2-1/2 year low today of 1.972%, which is supportive for stock prices. Today's weekly U.S. jobless claims data was also supportive for stock prices after weekly initial unemployment claims fell -6,000 to 216,000, showing a slightly stronger labor market than expectations of -2,000 to 220,000. Stock prices today are being undercut by increased US/Iran tensions on overnight news that Iran shot down a U.S. drone and the U.S. Central Command responded that "this was an unprovoked attack on a U.S. surveillance asset in international airspace." The VIX volatility index ($VIX) today fell to a 1-1/2 month low of 13.19% but has since rebounded higher and is up +0.36 to 14.69%. The VIX remains far below the 5-week high from June 3 of 19.75% and the early-May 5-1/2 month high of 23.38%.