The bond market is rallying following Powell’s comments yesterday. Yields are sharply lower, and stocks are positive for the 2nd day in November. Apple reports after the bell, and markets will be watching Friday’s jobs data closely.
Good afternoon, traders. It’s Chris Chavez with the Blue Line Futures and it’s your daily midday market minute. Stocks are continuing the rally from yesterday’s dovish comments from Fed Chair Powell. But before we get to it, if you’re watching this video like it, subscribe if you’re on our website, there’s also a link to direct you to YouTube and you can subscribe that way.
We would love for you to follow us. We would love for you to help us build our following. Yeah. So looking at the Fed meeting yesterday, the markets had priced in a pause. That’s exactly what we got. But Powell did sound a little bit more dovish then. I think what the markets were pricing in. Look at some of these deferred months now.
There’s now more interest rate cuts priced in for 2024 than there were yesterday before the meeting. So definitely something to keep an eye on. You know, Powell did mention that financial conditions were also more restrictive than they had been as of late, referencing not only the rise in 30 year yields, but also, you know, the sell off in equities as of late.
So, you know, that’s giving a little bit of room here today for a rally. You know, a continuation is exactly what we’re seeing. Bonds are rallying. You know, stocks are rallying. Really, it’s just a broad based risk asset rally. You know, when looking at these Treasury yields, all of the all of the yields across the yield curve are, you know, off of their highs.
You’re seeing this yield curve starting to flatten a little bit more, too. And definitely going to be a data driven, you know, event. I think the risks as what Powell had highlighted yesterday, there’s a risk of doing too much and doing too little. They were about the same. So it wasn’t weighed towards any one specific direction. And I think that puts it in a really good position that, you know, it’s probably likely we’re going to see a continued pause unless we were to really see some hot economic data that would contradict that.
So we did get some data here this morning. Initial jobless claims, they came in slightly above estimates, 217,000 versus 210,000. Looking at some of this other data, we also got nonfarm productivity for Q3 came in slightly warm, 4.7 for that quarter for Q3 versus 4.1. Estimates. Unit labor cost did show a little bit of a contraction. Actually estimates were for 7/10 for Q3 and we got a print of negative eight tenths.
So saw some weakness there. Factory orders did come in hot 2.8 verses 2.4 month over month or expected for September, saw a little bit of a pop in the Dow Jones industrial off that number there. Now, again, after the bell, we’re still in this earnings season and we’re going to get Apple after the bell. This is huge because they make up a significant portion of all of the stock indices.
Definitely going to affect sentiment. Apple reports after the bell. We’re going to get a lot of economic data tomorrow, jobs, data from nonfarm payrolls to average hourly earnings. The unemployment rate, I assume, as well. So there is still a lot that can definitely change things around again, especially if some of this data were to come in significantly hotter than expected.
So looking at the S&P major three star resistance is going to be 43, 27 and a half to 43, 37 and a half. Nasdaq three star resistance as well is going to be 15 10925138 gold, three star support. And I want to highlight three star support here because you’ve really failed to see the precious metals rally with stock indices, especially with this move in yields.
And it is a little bit concerning, but what’s really going to be more concerning if we break and close below some of these significant support levels and a significant three star support level to keep an eye on is going to be 1978 and 2/10 to 1982 and 8/10. Crude oil as well, kind of lagging behind here today. Three star support’s going to be 80, 22, 80, 57.
If you have any questions, reach out to us here. We’re here to help you call our Trade Desk. Remember, futures trading involves substantial risk of loss. It’s not suitable for all investors.