U.S. Stock Market

Dovish Fed Boosts Markets

Dovish FOMC Minutes Provide Additional Support To Stocks

S&P 500 futures are gaining ground in premarket trading as traders cheer dovish comments from the Fed.

FOMC Minutes indicated that Fed members believed that the economy was rebounding faster than expected but remained focused on providing strong support to markets.

In recent months, Treasury yields made a major upside move on worries that inflation will gain steam and Fed will be forced to raise rates sooner than it previously expected.

Currently, it looks that the Fed is not worried about inflation at all, and Treasury yields moved lower after the release of FOMC Minutes.

WTI Oil Mixed As Gasoline Inventories Grow

Yesterday, EIA Weekly Petroleum Status Report indicated that crude inventories declined by 3.5 million barrels compared to analyst consensus which called for a decline of 1.4 million barrels.

However, the report failed to provide material support to the market as gasoline inventories increased by 4 million barrels compared to analyst consensus which called for a decline of 0.2 million barrels. The increase of gasoline inventories may signal that demand is not as robust as expected.

The report also indicated that U.S. domestic oil productio declined from 11.1 million barrels per day (bpd) to 10.9 million bpd. Declining domestic production may serve as a bullish catalyst for the market and provide some support to oil-related stocks.

Initial Jobless Claims Increase To 744,000

The U.S. has just released Initial Jobless Claims and Continuing Jobless Claims reports.

The Initial Jobless Claims report indicated that 744,000 Americans filed for unemployment benefits in a week. Analysts expected Initial Jobless Claims of 680,000 so the report was worse than expected. In addition, the previous Initial Jobless Claims report was revised from 719,000 to 728,000.

Continuing Jobless Claims decreased from 3.75 million (revised from 3.79 million) to 3.73 million compared to analyst consensus of 3.65 million.

It remains to be seen whether disappointing Initial Jobless Claims report will put any pressure on stocks as traders remain focused on the dovish Fed.

For a look at all of today’s economic events, check out our economic calendar.