US Stock Futures Extend Recovery post Powell’s Comments

US Stock Futures Extend Recovery post Powell’s Comments


Major US stock index futures kicked off the week on a stronger note supported by Jerome Powell's latest comments. The Federal Reserve Chairman said that he expects a gradual recovery during the second half of the year, but the full recovery would happen with the help of a vaccine. Also, he added that in the long run and even in the medium run, you wouldn't want to bet against the US economy because it will recover. His comments expressed the Fed's willingness to do whatever it takes to make sure that the economy is back on the right track. The Dow Jones Industrial Average futures edged higher to 23934, the S&P500 futures rose to 2895, and Nasdaq futures climbed to 9242.


The dollar index, which measures the greenback against a basket of major currencies, held steady near 100.40 level during early trading awaiting fresh fundamental drivers. Fed Chairman Jerome Powell stated last week that the Federal Reserve is not considering negative interest rates, which its prospects are currently key movers for currencies. Market participants will look forward to further clarity on the economic outlook and the Fed's activity from the FOMC meeting minutes and Powell's appearances this week. The EURUSD is currently trading at $1.0815, the GBPUSD at $1.2120, and the USDJPY at 107.25.


Gold prices continued their upside rally supported by the soft global economic outlook and calls for further stimulus around the world. The price of a gold ounce rose to $1765, the highest since late 2012. Meanwhile, the price of a silver ounce rallied to $17.32, and palladium futures surged to $2050.


Oil prices extended gains as investors look forward to the reopening of the economies worldwide. Many top economic countries around the world are easing their lockdown measures and allowing activity again, which would lead to a recovery in oil demand levels. The West Texas Intermediate crude July delivery rose to $31.22, and Brent Blend July delivery rallied to $33.97.

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