Key Takeaways with Craig
An eventful day marked the last day of January trading after the FOMC held its Fed Funds target rate steady, as expected, but indicated in its remarks that a March cut was unlikely. Earlier in the day, CME’s FedWatch tool indicated a greater than 50% chance of a 25-basis point cut in March but, after Federal Reserve Chairman Powell’s remarks, was indicating a 64.5% chance of “no change” in March.
Ultimately, CME’s E-mini Nasdaq-100 futures price declined by about 1.9%, E-mini S&P 500 was down by about 1.6% and the Micro 10-Year Treasury Yield future was down by nearly 13 basis points.
- Despite today’s equity price decline, the major indexes wound up higher on the month and despite today’s yield decline, the 10-Year yield wound up higher in January. Below is the recap of monthly changes in price and volatility, using QuikStrike and CVOL data to compile.
- E-mini S&P500 and Nasdaq-100 prices were higher and, after today’s increase, implied volatility is higher in both than at the end of last year.
- Micro 10-Year Yield futures were up by just about 6 basis points.
- WTI Crude Oil futures prices are about 6% higher than at the end of December while CVOL was nearly unchanged in the options.
- Gold futures prices were near steady on the month, though CVOL declined substantially.
- Natural Gas prices, after a very active month, were down by about 15% while CVOL declined as well.
- Finally, Bitcoin prices, also after a very active month, wound up just 1% higher than they were at the end of December.
So as we move into February, seemingly with as many questions on the economy and direction of interest rates as we have answers, that’s where we stand. We’ll be back tomorrow reporting on CME’s commodity and financial markets ahead of Friday’s Employment Situation report.
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