Fed rate cut day: what to expect? 18/09/2024

US Pre-Market

Futures: The S&P 500 is up 0.16 %, the Dow Jones Industrial Average is up 0.17%, and the Nasdaq 100 is up 0.19%.
Stock futures remained flat Tuesday night as Wall Street awaited the Fed's much-anticipated rate cut, following years of aggressive hikes to combat inflation. Rate cuts typically boost corporate earnings and could offer relief from high borrowing costs and persistent inflation. The S&P 500, already up 18% this year, may see further gains. However, some investors are cautious about cutting rates too quickly. Peter Cecchini of Axonic Capital noted that a 50 basis point cut would be unusual given the current state of the housing market.
Watchlist for today: SNAP, INTC, CRM, MSFT, JPM, GIS, LUNR, X

Bitcoin

Bitcoin surged to $61,331 on Tuesday, just before the U.S. Federal Reserve’s meeting to discuss a possible rate cut. Crypto markets could see further gains if the Fed opts for a 50 basis point cut, according to Joe McCann, CEO of crypto hedge fund Asymmetric. However, McCann warned that if the Fed cuts rates by only 25 basis points, cryptocurrencies could decline along with the smaller adjustment.
Watchlist: Bitcoin: 57 450 -61 430 Ethereum: 2250-2475, Solana: 128.3 -140.20


Forex Market

The USD/JPY pair remains in a descending channel, with a potential rise toward 142.75 before rebounding and continuing its decline toward 134.45. Japan posted a ¥695.29 billion ($4.9 billion) trade deficit in August, driven by a weak yen that inflated import costs, even though exports reached a record high for the month. Meanwhile, EUR/USD remained relatively stable, with the euro trading at $1.1122.
  Whatchlits: EUR/USD: 1.1065-1.1121, USD/JPY: 139.88 -141.70

Basic Materials

Oil prices rose by about $1 per barrel on Tuesday as supply disruptions increased and traders anticipated higher demand if the U.S. Federal Reserve cuts borrowing costs this week, as expected. U.S. crude futures climbed $1.10 (1.6%) to $71.41, while Brent crude gained 95 cents (1.3%) to settle at $73.70 per barrel, reaching their highest levels this month. According to analysts at AEGIS Hedging, prices also gained support from rising tensions in the Middle East. Gasoline inventories also increased by 2.34 million barrels, more than offsetting last week's decline of 513,000 barrels.
Watchlist: GOLD 2550-2600  US Oil: 68 -70.80

The TEFS Analyst team wishes you a successful day!