S&P 500 futures are mostly flat in premarket trading as traders wait for new catalysts after the long weekend.
There are no important economic reports scheduled to be released today in the U.S., and traders will have to wait until Thursday for the release of employment reports. Initial Jobless Claims are expected to decline to 336,000 while Continuing Jobless Claims are projected to decrease to 2.74 million.
Meanwhile, the yield of 10-year Treasuries has moved closer to the recent highs at 1.375%, and it looks that bond traders are a bit nervous ahead of the Fed Interest Rate Decision which will be announced on September 22. In case the yield of 10-year Treasuries settles above 1.38%, it will likely gain upside momentum which may put some pressure on the stock market.
WTI Oil Moves Lower As Saudi Arabia Cuts Prices For Asian Customers
WTI oil is currently trying to settle below the $68 level as traders react to Saudi Arabia’s decision to cut prices for Asian customers in October. Interestingly, prices for U.S. and European customers remained at previous levels.
This move shows that Saudi Arabia is worried about the strength of demand in Asia. The region has been dealing with the spread of the Delta variant of coronavirus for some time, and it looks that Saudi Arabia anticipates lower demand due to virus-related problems.
Not surprisingly, Saudi Arabia’s decision put material pressure on the oil market, although it remains to be seen whether WTI oil will be able to gain additional downside momentum below the important support level at $67.50.
Higher Yields Put Pressure On Precious Metals
Gold and silver declined today as Treasury yields moved higher while the U.S. dollar gained ground against a broad basket of currencies.
The beginning of today’s trading session is set to be challenging for gold mining stocks and silver mining stocks. In case gold manages to get to the test of the psychologically important $1800 level, these stocks will find themselves under additional pressure.