Stocks are getting hammered in pre-market trading

As the North American session gets underway, the USD is the strongest, the NZD is the weakest of the major currencies.  US stocks are sharply lower as traders await the Fed minutes. Back when the Fed decision was imminent, Adam Button posted “This is probably a rare FOMC meeting where the minutes matter more than the statement“. Today's that day and the market is jittery of words that may be a little more hawkish than what has been expressed by members.  Feds Bullard and Quarles will speak before the minutes are released.  The Nasdaq stocks are down around -180 points in pre-market trading.  Bond yields are higher by a pip of two.  China gave the crypto market a jolt today as the refreshed their ban on crypto with measures designed to close loopholes. The price of bitcoin is down over 10.5% and back below the $40000 level (and below its 200 day MA for the first time since April 2020 at $39,695.48.  The 200 day MA at that time?  Around $7986.).

Looking at the ranges and changes, the USD is starting the session near highs vs the major currencies with the largest declines vs the NZD (-66 pips) and the AUD (-56 pips).  The GBPUSD is also near lows at -42 pips on the day. 

The ranges and changes for the major currency pairs
In other markets….
  • Spot gold is trading down $8.17 or -0.44% $1861.35 as it reacts to the higher dollar.
  • Spot silver is down $0.46 or -1.66% at $27.71.
  • WTI crude oil futures are trading down -$1.40 or -2.12% at $64.10. The market is eyeing the potential nuclear reduction deal with Iran. A deal could lead to removal of sanctions against the country, which would increase global oil supply
  • Bitcoin is down $-4760 or -11% at $38,520.  Ethereum is also getting hammered and is trading down -$718 or -20.85% at $2715.  The price traded at a high of $4380 on May 12 (-38% from May 12)

The premarket for US stocks the major indices faced their third day of losses led by the NASDAQ. The futures are currently implying:

  • Dow industrial average -271 points after yesterday's decline of -267 points
  • S&P index -39.5 points after yesterday's decline of -35.46 points
  • NASDAQ index -181 points after yesterday's decline of -75.41 points.

In the European equity markets, the major issues also sharply lower:

  • German DAX, -1.72%
  • France's CAC, -1.6%
  • UK's FTSE 100, -1.52%
  • Spain's Ibex, -1.1%
  • Italy's FTSE MIB, -1.7%

In the US debt market, yields are mostly higher with the yield curve steepening. The 2– 10 year spread is up to 150.5 point basis points from 148.78 basis points of the close yesterday.

US yields are higher Looking at the European debt market, the benchmark 10 year yields are the most of the exception of the France which is down German yield moved to high of -0.074%. That is the cycle high and moves the yield closer to the 0.0% level. The last time the German yield traded above 0% was May 2019.
European yields are higher

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