US open: Futures flat in the calm before the Fed storm

Wall Street is pointing to a steady start with stocks hovering around record highs as the Fed's two day meeting begins.

USA (2)

US futures

Dow futures +0.01% at 34409

S&P futures +0.1% at 4260

Nasdaq futures +0.15% at 14050

In Europe

FTSE +0.4% at 7187

Dax +0.46% at 15767

Euro Stoxx +0.57% at 4153

Learn more about trading indices

Mixed data shrugged off, all eyes on the Fed

Stocks are pointing to a flat start, hovering around record high as the Fed’s two day policy meeting kicks off and as investors digest the latest retail sales and PPI numbers.

Retail sales dropped by a more than expected -1.3% in May. Expectations had been for a -0.8% decline. However, April’s sales were upwardly revised from 0% to +0.9%. The net effect across the two months was positive.

Meanwhile wholesale inflation as measured by PPI rose a larger than expected 0.8% MoM in May.

The mixed data hasn’t raised any eyebrows in the market. The market has barely responded with few brave enough to take big positions ahead of tomorrow’s Fed announcement. The big question is whether the Fed will start, very slowly, introducing taper talk and the debate surrounding reining in ultra-lose monetary policy.

Equities have rallied to record highs and bond yields have eased to three month lows creating a good runway for the Fed to introduce taper talk. We could expect to see some volatility should the Fed start to talk taper.


Oracle will be in focus after reporting EPS $1.31 on revenue of $11.02 billion for Q4 ending May 31.

Boeing trades -0.5% lower and will be under the spotlight after the US and EU call a truce on the 17 year dispute over aircraft subsidies to the plane manufacturer.

Where next for the Dow Jones?

The Dow has been trending lower over the past week. Despite attempting to tick a few points higher today, it remains below the week old descending trendline. The Dow also trades below it 50 sma on the 4 hour chart. However, it is finding support on the 200 sma. Any move higher would need to retake the ascending trend line resistance at 34500 and the 50 sma at 34550. It would take a move above 34730 for the bulls to gain traction and attach 34850. Any move lower would need to break below the 200 sma at 34350, bringing 3422 into view. A breakthrough this level could prompt a bigger sell off.

FX – USD edges lower, GBP declines despite strong jobs data

The US Dollar is on the rise as the FOMC meeting begins and investors weigh up the possibility of the Fed starting to talk about tapering its asset purchases.

GBP/USD trades under pressure despite upbeat UK jobs data. Unemployment ticked lower to 4.7% in the three months to April, in line with forecasts and down from 4.8% in March. The number of people joining the payroll also surged to a record high in May of 197,000 as indoor hospitality re-opened. Still after Boris Johnson delayed the final lifting of restrictions the Pound remains under pressure. Brexit is also a drag.

GBP/USD  -0.1% at 1.4103

EUR/USD  +0.1% at 1.2118

Oil jumps to fresh multi year highs

Oil prices are bounding higher recouping mild losses in the previous session. Oil trades at multi year highs amid a strong demand outlook as vaccine programmes have reopened enable economies to reopen. The EIA now sees demand returning to pre-pandemic levels by the end of 2022. This is sooner than anticipated. The EIA also urged OPEC+ to increase supply in order to meet rising demand.

One major concern for the market has been the prospect of Iranian oil returning to the market in the event that the 2015 Iran nuclear deal is revived. However talks with the US are progressing slowly and now Iranian presidential elections later this week are another disruption to that process. In short, the threat of Iranian oil flooding the market soon, has dwindled.

US crude trades +1.4% at $71.64

Brent trades +1.07% at $73.34

Learn more about trading oil here.

The complete guide to trading oil markets

Looking ahead

14:15 US Industrial Production

21:30 API Crude Oil Stock Inventories

How to trade with City Index

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

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

More from Indices


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 for the complete Risk Disclosure Statement.