U.S. indices closed lower on Wednesday, pressured by shares in the Automobiles & Components (-3.56%), Semiconductors & Semiconductor Equipment (-2.13%) and Technology Hardware & Equipment (-1.73%) sectors. The Federal Reserve released their minutes from the April 30 -May 1 meeting stating that their members believe a “patient approach” regarding the target range for the federal funds rate would be “appropriate for some time” and observed that risks outlined earlier in the year (global economic outlook, Brexit, trade negotiations) have “moderated”.
The S&P 500 (2,856.27) stays below both its 20d moving average (2,889.18 – negative slope) and 50d moving average (2,873.36 – positive slope).
European markets are expected to start on a negative note.
Foreign Exchange
The US dollar was bullish against all of its major pairs on Wednesday with the exception of the CHF and the JPY. On the economic data front, MBA mortgage applications improved by 2.4% in week ended May 17th from a decline of 0.6% in the prior week. In other news, the Federal Reserve released their minutes from the April 30th-May 1st meeting stating that their members believe a “patient approach” regarding the target range for the federal funds rate would be “appropriate for some time” and observed that risks outlined earlier in the year (global economic outlook, Brexit, trade negotiations) have “moderated”.
The Euro was bullish against most of its major pairs with the exception of the CHF and the JPY. The UK CPI index rose by 0.6% in April (+0.7% expected) after a 0.2% increase a month earlier. YoY, prices rose 2.1% (+2.2% anticipated) after being up by 1.9% in March.
The Australian dollar was bullish against all of its major pairs except for the CHF and the JPY.
Commodities
After the close of Wall Street, WTI Crude Future (JUL 19) was down $1.8 to $61.3. The contract was below its 20D MA (@ $62.63) and below its 50D MA (@ $62.35). The US Department of Energy reported that, for the week ended 17 May, crude oil inventories increased 4740k barrels compared to the previous week.
Gold was about flat to $1273.7. The precious metal was below its 20D MA (@ $1283) and below its 50D MA (@ $1290).
Copper Future (JUL 19) on Comex was down 3.9c to 267.55c/lb. The contract was below its 20D MA (@ 278.44c) and below its 50D MA (@ 286.38c). The 14d RSI below 30 (28.55) indicates Copper Future (JUL 19) contract was oversold. In Europe, the London Metal Exchange reported its copper inventories decreased 1550 tons to 187700 tons.