US open: Wall Street points to a mixed open, PPI inflation in focus

US futures

Dow futures -0.08% at 36397

S&P futures +0.03% at 4703

Nasdaq futures +0.15% at 16367

In Europe

FTSE +0.03% at 7309

Dax +0.29% at 16091

Euro Stoxx +0.21% at 4367

Learn more about trading indices

A more dovish Fed coming?

US stocks are pointing to a mixed start after the S&P500 notched up yet another record close in the previous session, its eighth straight record close.

Today the Nasdaq is leading the charge whilst the Dow is trading mildly in the red as investors weigh up the possibility of a reshuffle at the Fed. News that Fed Governor Lael Brainard who is considered to be more dovish than Fed Chair Powell attended an interview at the White House. Brainard’s recent commentary has shown that she is in no rush to raise interest rates. A more dovish Fed Chair would be less supportive of cyclical stocks whilst boosting high growth companies. Powell’#’s current term ends in February.

Attention now will turn to US inflation with the release of PPI data today and CPI inflation data tomorrow. PPI is expected to continue ticking high to 8.7% YoY in October and rising 0.5% MoM.

Where next for S&P 500?

The S&P 500 recorded its 8^th straight record close on Monday and futures are edging higher still. The price trades above the rising trendline, although the RSI is firmly in overbought territory. Any move lower could be used as a buying opportunity. It would take a move below 4550 for sellers to gain traction and the 50 sma to be exposed.

FX – USD extends losses, EUR shrugs off rebounding German sentiment

US Dollar is easing lower amid uncertainty surrounding the next move by the Fed and the possibility of a reshuffle at the Fed.

EUR/USD has shrugged off impressive German data. The closely watched German ZEW sentiment data unexpected rose in November to 31.7, up from 22.3 in October and well ahead of the 19 forecast. This improvement in sentiment comes after supply chain bottlenecks had dragged the index lower over the past 5 months.

GBP/USD +0.12% at 1.3580

EUR/USD +0.01% at 1.1586

Oil rises for third straight session

Oil prices are on the rise for a third straight session supported by several bullish factors such as tight supply, the passage of the US infrastructure bill, and Saudi Armco raising its official selling price. However, price gains may be capped as the Biden administration considers what action it can take to bring down prices at the pumps. The release of key reserves is a possibility being floated as a way to bring down prices. That said bullish factors are still aplenty for now. Whether such as move by the Fed really brings down prices would depend largely on how much is released. For now, this is still at the ideas stage so the impact is minimal.

API inventory data is due later today.

WTI crude trades +0.35% at $81.42

Brent trades +0.3% at $83.30

Learn more about trading oil here.

Looking ahead

13:30 PPI

14:00 Fed Chair Powell

How to trade with City Index

Follow these easy steps to start trading with City Index today:

Open a City Index account, or log-in if you’re already a customer.
Search for the market you want to trade in our award-winning platform.
Choose your position and size, and your stop and limit levels
Place the trade.

StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. CFD and Forex Trading are leveraged products and your capital is at risk. They may not be suitable for everyone. Please ensure you fully understand the risks involved by reading our full risk warning.

City Index is a trading name of StoneX Financial Ltd. Head and Registered Office: 1st Floor, Moor House, 120 London Wall, London, EC2Y 5ET. StoneX Financial Ltd is a company registered in England and Wales, number: 05616586. Authorised and regulated by the Financial Conduct Authority. FCA Register Number: 446717.

City Index is a trademark of StoneX Financial Ltd.

The information on this website is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement.