January 2, 2018
STOCK INDEX FUTURES
Major stock index futures finished last year with their best performance since 2013 due to optimism that the new tax law in the U.S. will benefit corporations, the strengthening global economy, solid corporate earnings and still relatively low interest rates that have been the fuel for this bull market.
The 8:45 central time December manufacturing PMI is expected to be 55.
Washington is gearing up for a government funding battle with a January 19 deadline.
The main trend for stock index future is higher.
The U.S. dollar fell to a four month low, while the euro currency advanced to a four month high.
Strength in the euro is linked to news that euro zone factories ended 2017 growing at their fastest rate in over than two decades. A monthly factory index for the euro area jumped to a record 60.6 in December.
The British pound is higher in spite of news that a U.K. manufacturing PMI fell below expectations in December.
A purchasing managers index for the manufacturing industry in the U.K. fell to 56.3 in December, which is down from 58.2 a month earlier. The December figure was below the expectations of a reading of 57.9.
The Canadian dollar is lower due to weaker crude oil prices.
However, the Australian dollar advanced to a three month high on news that Chinas manufacturing growth unexpectedly picked up to a four month high in December due to a surge in new orders. The Caixin/Markit Manufacturing PMI rose to 51.5 from 50.8 in November, which is well above expectations of a decline to 50.6.
The Australian dollar is higher in spite of news that Australian home prices fell in the last three months of 2017, which was the first decline in almost two years.
INTEREST RATE MARKET FUTURES
The Treasury will auction 52 week bills today.
The probability of a fed funds rate hike at the FOMCs March 21, 2018 policy meeting is 57%, which compares to 56% on Friday.
Futures are likely to work lower in the longer term, especially at the long end of the curve, as growth in the global economy accelerates.
SUPPORT AND RESISTANCE
March 18 S&P 500
Support 2671.00 Resistance 2694.00
March 18 U.S. Dollar Index
Support 91.330 Resistance 92.010
March 18 Euro Currency
Support 1.20450 Resistance 1.21470
March 18 Japanese Yen
Support .88910 Resistance .89660
March 18 Canadian Dollar
Support .79590 Resistance .80010
March 18 Australian Dollar
Support .7788 Resistance .7857
March 18 Thirty Year Treasury Bonds
Support 152^8 Resistance 152^30
February 18 Gold
Support 1301.0 Resistance 1320.0
March 18 Copper
Support 3.2600 Resistance 3.3150
February 18 Crude Oil
Support 59.95 Resistance 60.86
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