Fed’s
December T-bonds [USZ9>USZ9] plunged to contract lows in response to the Federal Reserve’s decision today to leave interest rates unchanged but to adopt a “tightening bias.” The market sold off a full point to 112 14/32, interpreting the Fed’s new stance as raising the chance it will hike interest rates at the next FOMC meeting in November.
Stock indexes also sold off immediately after the Fed’s announcement, erasing earlier gains. December Dow futures [DJZ9>DJZ9] fell over 100 to end the day down 25 at 10,485, S&P futures [SPZ9>SPZ9] finished 3.00 lower at 1315.70 and NASDAQ 100 futures [NDZ9>NDZ9] resisted the sell off, ending the day up 12.50 at 2508.50
December dollar index futures [DXZ9>DXZ9] fell back to just above recent lows, closing .09 lower at 97.67 (the contract fills the second position on the Implosion-5 List). The Japanese yen [JYZ9>JYZ9] hit a 10-day low during the session and closed down .0027 at .9498. Swiss francs [SFZ9>SFZ9], from theMomentum-5 List, rallied back from a gap-down start, climbing to its highest close in 20-days at .6851, a gain of .0018. Also on the list, British pounds [BPZ9>BPZ9] closed at their highest level of the year, gaining .0018 to 1.6578.
The energies slipped again: November crude [CLX9>CLX9] hit a 19-day low and closed down .31 at 23.45. Heating oil [HOX9>HOX9] retreated .0095 to .5961 and natural gas [NGX9>NGX9] lost .039 to 2.586.
Demonstrating why it has headed the Momentum-5 List for nearly two weeks, December gold [GCZ9>GCZ9] jumped out of the gates, gapping up nearly 20, then traded back the other way to end up 8.00 at 326.0.
December silver [SIZ9>SIZ9] also gapped up but trended down during the session, closing down 6.7 at 556.3.
The grains traded within a very narrow range and ended mixed, ensuring soy contracts will appear again on tomorrow’s