Indices mark time waiting for the Fed

Indices are unchanged ahead of this week's critical earnings and economic reports. Traders remain cautious ahead of tech earnings reports and a set of critical economic data scheduled for release ahead of next week’s highly-anticipated meeting of the Federal Reserve.

Wall Street watches data for rate hike signs

Wall Street remains obsessed by how the Federal Reserve that will be impacted by host of upcoming data releases: durable goods orders data for March released on Wednesday; weekly jobless claims data on Thursday; a first-quarter gross domestic product, also scheduled for Thursday; and Personal Consumption Expenditures (PCE) inflation data on Friday.

The market currently expects the Fed to raise its benchmark interest rate another 25 basis points to push it above 5% on May 3, but traders will be more interested in any wording in the policy statement or the press conference afterwards that might signal the Fed’s intentions past the upcoming meeting.

Trend economic growth, manufacturing in recession

Analysts expect this week's GDP data to show that the economy grew at a 2% pace, consistent with recent data, but the manufacturing sector remains in a recession
The Chicago National Activity Index for March, a weighted average of 85 existing economic data points, came in at -0.19, equal to the previous month, suggesting that the economy was growing at slightly below trend levels
The three-month moving average is 0.01, suggesting that the economy overall grew at trend levels in the first quarter
The Dallas Fed manufacturing index for April came in at -23.4, below analyst expectations of -11.5, and down from -15.7 the previous month, with negative readings indicating contraction

Indices, Dollar unchanged

At the time of writing, the broad S&P 500 index was unchanged at 4,129 while the tech-heavy NASDAQ was down -0.6% at 12,000
The VIX, Wall Street’s fear index, edged up to 17.2
The dollar index was flat at 101.4, with major cross rates unchanged
Yields on 2- and 10-year Treasuries fell to 4.14% and 3.51%, respectively

Oil higher, Gold unchanged

Gold prices were unchanged at $1,994 per ounce
Crude oil prices rose 1.0% to $78.6 per barrel
The grain and oilseed sector was mixed

Ukraine counter-offensive gears up

Ukrainian forces long-anticipated spring counter-offensive got under way, with forces establishing a foothold on the east side of the Dnipro River near Kherson
A retired British army officer told reporters to be prepared for a “big bang” attack to disrupt the current stalemate in the war, with Ukraine forces bolstered with newly acquired ground and air equipment support from contributing NATO members
Confidence is declining that the Ukraine grain initiative will be extended in its current form, which means that we could see it start to wind down in the next 10 days, with ships wanting to make the round trip in and out of Ukraine ports prior to May18

China missteps on the world stage

China finds itself starting the week by trying to re-establish relationships with the European Union, hoping that it will stay out of the fray with Taiwan, while continuing to establish stronger trade ties
Josep Borrel, an EU foreign affairs representative, called on the EU navy to begin patrolling the Taiwan Strait
China also had to do damage control following comments by ambassador Lu Shaye that seemed to question the sovereignty of Ukraine and other former Soviet states
China had to walk back the statements and declare that Ukraine and other former Soviet states do have autonomy

Analysis by Arlan Suderman, Chief Commodities Economist

Contact: Arlan.Suderman@StoneX.com

This report is intended for general circulation only. It should not be construed as a recommendation, or an offer (or solicitation of an offer) to buy or sell any financial products. The information provided does not take into account your specific investment objectives, financial situation or particular needs. Before you act on any recommendation that may be contained in this report, independent advice ought to be sought from a financial adviser regarding the suitability of the investment product, taking into account your specific investment objectives, financial situation or particular needs.

StoneX Financial Pte. Ltd., may distribute reports produced by its respective foreign entities or affiliates within the StoneX group of companies or third parties pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the report is distributed to a person in Singapore who is not an accredited investor, expert investor or an institutional investor (as defined in the Securities Futures Act), StoneX Financial Pte. Ltd. accepts legal responsibility to such persons for the contents of the report only to the extent required by law. Singapore recipients should contact StoneX Financial Pte. Ltd. at 6826 9988 for matters arising from, or in connection with the report.

In the case of all other recipients of this report, to the extent permitted by applicable laws and regulations neither StoneX Financial Pte. Ltd. nor its associated companies will be responsible or liable for any loss or damage incurred arising out of, or in connection with, any use of the information contained in this report and all such liability is hereby expressly disclaimed. No representation or warranty is made, express or implied, that the content of this report is complete or accurate.

StoneX Financial Pte. Ltd. is not under any obligation to update this report.

Trading CFDs and FX on margin carries a high level of risk that may not be suitable for some investors. Consider your investment objectives, level of experience, financial resources, risk appetite and other relevant circumstances carefully. The possibility exists that you could lose some or all of your investments, including your initial deposits. If in doubt, please seek independent expert advice. Visit www.cityindex.com/en-sg/terms-and-policies for the complete Risk Disclosure Statement.

ALL TRADING INVOLVES RISKS. LOSSES CAN EXCEED DEPOSITS.

City Index is a trading name of StoneX Financial Pte. Ltd. (“SFP”) for the offering of dealing services in Contracts for Differences (“CFD”). SFP holds a Capital Markets Services Licence issued by the Monetary Authority of Singapore for Dealing in Exchange-Traded Derivatives Contracts, Over-the-Counter Derivatives Contracts, and Spot Foreign Exchange Contracts for the Purposes of Leveraged Foreign Exchange Trading. SFP is also both Derivatives Trading and Clearing member of the Singapore Exchange (“SGX”). SFP is a wholly-owned subsidiary of StoneX Group Inc.

The information provided herein is intended for general circulation. It does not take into account the specific investment objectives, financial situation or particular needs of any particular person. You should take into account your specific investment objectives, financial situation or particular needs before making a commitment to invest, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit. No representation or warranty is given as to the accuracy or completeness of this information. Consequently, any person acting on it does so entirely at their own risk.

The information does not represent an offer of, or solicitation for, a transaction in any investment product. Any views and opinions expressed may be changed without an update. To understand the risks and costs involved, please visit the section captioned “Important Information” and the “Risk Disclosure Statement”.

The information herein is not directed to, or intended for distribution to or use by, any person or entity who is a citizen or resident of or located in any locality, state, country or other jurisdiction where such distribution, publication, availability or use would be contrary to law or regulation.

StoneX Financial Pte. Ltd. 1 Raffles Place, #18-61, One Raffles Place Tower 2, Singapore 048616. Tel: 6309 1000. Co. Reg. No.: 201130598R.

This advertisement has not been reviewed by the Monetary Authority of Singapore.