Trish: The Federal Reserve Holds the Power to Make Or Break Investors

U.S. futures sought direction on Wednesday morning as traders went into holding mode ahead of the Fed’s Jackson Hole symposium

Investors are anxious to understand the Fed’s intentions regarding both interest rates and bond asset purchases. It has already telegraphed a slowdown in bond buying for this year, but, when (if ever) will it focus on interest rates? (Story continues below.)

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Repeatedly, Fed Chief Jerome Powell has explained the Fed’s devotion to employment indicators rather than inflation reads. Inflation, the Fed tells us, is “transitory” and therefore most emphasis must be placed on employment.

Given that employment is currently 5.4% (which is historically quite low) I would suggest the Fed watch the inflation indicators more carefully. The freshest read on inflation is record breaking; the prices that producers pay for goods and services is up 7.8% in the last year. That will surely spill over into consumer prices which are already up 5.4%.

In 1965, Federal Reserve chief William Martin tried a similar tactic. He focused on employment data rather than inflation. By the 1970s, America was experiencing hyper inflation.

It should be a lesson. But, as we know, history has a tendency to repeat itself.

Equities

U.S. stock futures sought direction in Wednesday’s premarket trading, as the Chinese tech stock rebound stalled. 

Level Chg. Chg. %
DOW Futures 35,322.00 8 0.02%
S&P 500 Futures 4,483.75 1.25 0.03%
Nasdaq Futures 15,360.75 5.25 0.03%

U.S. Dollar and Treasuries

U.S. Treasury yields were little changed. The yield on the 10-year Treasury rose two basis points. The dollar strengthened against a basket of major currencies.

Price Chg. Chg. %
U.S. Dollar Index (DXY): 93.09 +0.20 (+0.21%)

 

Yield Change Previous close
U.S. 1 Year Treasury Bill 0.066% 0 0.066%
U.S. 2 Year Treasury Note 0.242% -0.004 0.230%
U.S. 5 Year Treasury Note 0.795% -0.003 0.798%
U.S. 10 Year Treasury Note 1.298% 0.003 1.295%
U.S. 20 Year Treasury Bond 1.829% -0.012 1.841%
U.S. 30 Year Treasury Bond 1.908% -0.010 1.918%

 

Stocks To Watch

Tech incubator Astrotech Corporation has announced that its subsidiary 1st Detect has secured a landmark purchase of its TRACER 1000 airport security tech. TRACER 1000 explosives trace detector. 

Pharmaceutical company Baudax Bio continues to rise after jumping more than 20% on Monday on news of insider buying. 

Education tech company New Oriental Education lost some of its gains from the Chinese tech stock rebound. The company was hit hard during the Chinese crackdown on the ed-tech sector. 

Meme stocks including AMC and Naked Brand were up in premarket trading on retail investor interest. 

Symbol Price Chg. Chg. % Volume
Astrotech Corp ASTC $1.18 +0.1400 +13.46% 5.70M
AMC Entertainment AMC $45.50 +1.24 +2.80% 2.70M
Baudax Bio Inc BXRX $0.69 +0.0411 +6.38% 2.67M
New Oriental Education EDU $2.08 -0.07 -3.26% 2.18M
Naked Brand NAKD $0.66 +0.0318 +5.09% 2.01M

 

Commodities To Watch

Oil steadied after a two-day rally, boosted further by Mexican oil rig outage. The rig is expected to be back online soon. Gold dropped. 

Price Chg. %
WTI Crude Oil $68.02 0.71%
Brent Crude Oil $71.68 0.89%
Natural Gas $3.89 -0.18%
Gold $1,793.00 -0.86%
Silver $23.80 -0.39%
Copper $4.28 0.58%
Soybeans $1,329.25 -0.19%

 

Crypto

The global crypto market cap is $2.03T, a 4.69% decrease over the last 24 hours. Bitcoin’s dominance is currently 44.01%, an increase of 0.59% in the same period.

Symbol Price Chg. % Market Cap.
Bitcoin BTC $47,737.81 -3.01% $897.33b
Etherium ETH $3,149.65 -4.87% $367.99b
Cardano ADA $2.70 -5.35% $84.08b
Ripple XRP $1.16 -6.24% $50.93b
Dogecoin DOGE $0.2871 -7.32% $37.61b

 

 

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