SubscribeDaily Futures Commentary September 21, 2009
Monday, September 21, 2009
Concerns that U.S. equity markets may be overbought are helping to drive down demand for stocks overnight. In addition, traders are lightening up positions ahead of this week’s Federal Reserve FOMC meeting. Investors will be watching to see if the Fed announces an end to its stimulus plans. The G-20 meets later in the week. Traders will be watching this meeting to see if there is any talk of limiting the Dollar’s role as the world’s reserve currency.
Despite the weakness in the equity markets, Treasury futures are trading lower. This week’s $112 billion auction is providing the pressure as once again supply will rise. The recent lower yields may encourage investors to ask for higher interest rates on these debt instruments. Traders will also be watching to see if China retaliates to the recent boost in taxes on imported tires by cutting back on demand for Treasury debt.
The U.S. Dollar finished last week with a strong rally as traders reduced their exposure to higher-yielding assets. Based on the overnight action, it appears to be starting the week in the same fashion. Global financial system worries, the …
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