Written Commentary
Wkly Futures Market Summary For 2.10.2025
February 10, 2025
STOCK INDEX FUTURES
U.S. stock index futures are higher suggesting the New Year’s strong start will continue.
The 9:00 central time December Institute for Supply Management manufacturing index is expected to be 60.5.
The 9:00 November Job Openings and Labor Turnover Survey (JOLTS) is anticipated to be 11.060 million. The Labor Department’s JOLTS report tracks monthly changes in job openings and offers rates on hiring and quits.
Stock index futures have a tendency to gain in the start of a new year. The S&P 500 was higher in the first week of the calendar year in 11 of the last 13 years.
Higher prices are likely for stock index futures in the first part of 2022.
CURRENCY FUTURES
The U.S. dollar index and the euro currency remain in broad sideways patterns, and with interest rate differential expectations offering no clear advantage to either currency, the sideways trade will likely continue for the U.S. dollar and the euro currency over the near term.
German jobless claims fell by more than expected in December. Jobless claims declined 23,000 on the month after falling 34,000 in November. Economists had forecast a decline of 15,000.
Consumer credit in the U.K. increased by GBP 1.2 billion in November of 2021, following an upwardly revised GBP 0.8 billion increase in October and beating market expectations of a GBP 0.8 billion gain. This was the biggest rise in consumer credit since July 2020.
A hawkish Bank of England will likely continue to support the British pound. The Bank of England surprised traders in December by hiking interest rates from record low levels. In addition, markets have priced in up to four Bank of England interest rate hikes in 2022.
An accommodative Bank of Japan will likely pressure the yen in the first part of this year.
INTEREST RATE MARKET FUTURES
If the U.S. economy weakens, it may be difficult for the Fed to justify an accelerated taper of its asset-purchase program, especially now that some central banks are adding more accommodation or are delaying the partial removal of easy-monetary policies.
On December 30 futures at the short end of the curve broke out above a downtrend line that started in late November.
The fundamentals for the interest rate futures at the short end of the curve are now mostly aligned on the bullish side.
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