Key Takeaways with Craig
As we talked about yesterday, the July Employment report was released this morning and indicated a stronger than expected labor market. The initial reaction in the Equity market was one of “good news is bad news” as prices broke on the news. However, equity prices recovered to close mixed with the Nasdaq down by about 1% and the Dow and S&P 500 near steady on the day. US Treasury yields jumped with the Micro 2-Year Treasury up about 20 basis points and the 10-Year up about 15. This makes the 2s and 10s inverted by about 42 basis points. Also, CME’s FedWatch tool now reflects a 68.5% chance of a 75 basis point rate hike at the September FOMC meeting; up from about 34% yesterday.
As we often do on Fridays, here is a recap of the net price and volatility changes during the first week of August in some of CME’s major products using QuikStrike data:
- E-mini S&P 500 futures prices were near steady while the Nasdaq-100 rose slightly. Implied volatility was nearly unchanged in both options markets.
- WTI Crude Oil futures prices were down by 10% while implied volatility in the options rose slightly.
- US Treasury yields jumped with most of the increase coming today, as we mentioned above.
- Soybean and Corn prices fell just slightly though volatility in the options declined substantially.
So, even as we enter the dog days of August, to say CME financial and commodity markets remain active is an understatement. Have a wonderful weekend and we’ll see you all on Monday.
Todays Featured Videos
Today's Future Price Action
The information in the market commentaries have been obtained from sources believed to be reliable, but we do not guarantee its accuracy and expressly disclaim all liability. Neither the information nor any opinions expressed therein constitutes a solicitation of the purchase or sale of any futures or options contracts. The information on this site compiled by CME Group is for general purposes only. All information and data herein is provided as-is. Additionally, all examples on this site are hypothetical situations, used for explanation purposes only, and should not be considered investment advice or the results of actual market experience. CME Group assumes no responsibility for any errors or omissions. CME Group, its affiliates and any third party information and content providers expressly disclaim all liability with respect to the information and data contained herein including without limitation, any liability with respect to the accuracy or completeness of any data. You use the data herein solely at your own risk. All data and information provided herein is not intended for trading purposes or for trading advice. All matters pertaining to rules and specifications herein are made subject to and superseded by official CME, CBOT, NYMEX and COMEX rules. Current rules should be consulted in all cases concerning contract specifications.
Neither futures trading nor swaps trading are suitable for all investors, and each involves the risk of loss. Due to the leveraged nature of futures trading and swaps trading, it is possible to lose more than the amount deposited in a position. Therefore, traders should not deposit more funds than they can afford to lose without negatively affecting their lifestyles. A trader cannot expect to profit on each trade, and should only devote a small amount of their available funds to each trade. All references to options refer to options on futures.
Past performance is not necessarily indicative of future performance.
CME Group, the Globe Logo, Chicago Mercantile Exchange, Globex and CME are trademarks of Chicago Mercantile Exchange Inc. CBOT is the trademark of the Board of Trade of the City of Chicago, Inc. NYMEX is the trademark of the New York Mercantile Exchange, Inc. COMEX is a trademark of Commodity Exchange, Inc. All other marks are the property of their respective owners. Each of Chicago Mercantile Exchange Inc. (ARBN 103 432 391), The Board of Trade of the City of Chicago Inc (ARBN 110 594 459), the New York Mercantile Exchange Inc (ARBN 113 929 436) and Commodity Exchange, Inc. (ARBN 622 016 193) is a registered foreign company in Australia and holds an Australian market licence.
This site does not constitute a prospectus, product disclosure statement or legal advice, nor is it a recommendation to buy, sell or retain any specific investment or to utilise or refrain from utilising any particular service. Readers should consult their legal advisors for legal advice in connection with the matters covered on this site.