Markets got what they wanted last night as the FED confirms that they will keep rates low until at least 2024. They want to see a prolonged period of strong inflation before taking any action. He also said there would be plenty of warning before they will make policy less accommodative.
US DOW and SP500 edged further into all-time highs. The Bond space did not really move much, as the FED was able to keep the calm. Sectors where mixed overnight with Discretionary leading the way higher. Commodities are just going sideways including Iron Ore. It seems other than US shares going higher it is fairly quiet out there.
Locally there is a little bit of uncertainty creeping in as we approach the end of the Keepers and Seekers subsidies. Many are still worried that the economy could get worse before it gets better with many small businesses still closing their doors. All in all, though as long as we don’t see any further large lock downs we are on a strong path forward this year.
The XJO is expected to have a soft open this morning, following similar leads from the U.S last night. With the U.S holding their support, they may push higher leading to gains in our market. U.S futures sit in the green, so despite our soft open, hopefully this can translate to further gains during our session today.
There is a key level of resistance at roughly 6850 which we have been reluctant to push through the past few weeks. If the U.S can maintain its momentum hopefully we can break through and get back to our post-pandemic highs of roughly 6950.
The AUD rallied last night, which may put pressure on our miners and some other key players. Outside this, we are just waiting for the U.S to decipher Powell’s remarks and give lead.
The US markets edged higher overnight. The Dow continues to outperform in the short-term pushing further into all-time highs. The SP500 is also pushing into all-time highs. The Nasdaq continues to edge higher. Markets in the US have what they want, 1.9 trillion in stimulus with $1,400 in cash payments. The FED is committing to a very accommodative stance and a roll-out of Vaccines.