- Markets still in cautious mode, rebound after Thursday’s fall.
- The mixed dollar, metals correct lower and oil falls.
- Data ahead: Existing Home Sales, Consumer Confidence, and Fed Official Speeches.
After Thursday’s sharp drop, futures point to a rebound at Friday’s open. The S&P 500 lost 2.12% yesterday and points to a 0.45% gain, although in negative territory for the week. Some easing of tensions between the US and Russia helped to improve the mood of the markets.
The Dow Jones fell 1.78% on Thursday, in the worst day since November. On Friday it is rebounding, but a climate of caution is still noticeable in the financial markets. Treasury bond yields are trading flat. The 10-year rate fell to a weekly low of 1.95% hours ago and then bounced back to 1.97%.
The dollar trades without a clear direction on Friday, in a context of low volatility in currencies. The DXY it is unchanged at 95.80, at the same level where it closed for the last two days. Commodities continue to show higher volatility. Metals are paring back some of the recent gains after XAU/USD (gold) could not be claimed over $1900 and that XAG/USD (silver) will stop just below $24.00.
The situation on the Ukrainian border remains a key issue in the financial markets. The announcement of the meeting between the US and Russian foreign ministers served to ease the negative climate. Another relevant factor continues on the bond market and the general expectations of monetary policy.
In this regard, today the presentations of several members of the FOMC can bring noise. CHarles Evans and Christopher Waller will speak on the new monetary policy strategy, John Williams on the economic outlook and Lael Brainard of digital currencies. In addition, data on existing home sales and the Conference Board’s consumer confidence report will be published.
On corporate resultson Friday it will be the turn of DraftKings, AIR Canada, North Bud Farms and Deere.
Technical levels
Source: Fx Street
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