The EURUSD whipped around yesterday, closing the day modestly lower after the FOMC kept rates unchanged. The USDJPY also traded higher and lower, and true to the pattern, the GBPUSD also was up and down volatile as the market concluded the FOMC is steady for now. Today, the USD is mixed in those three major currency pairs with the EURUSD and GBPUSD lower modestly (higher USD). The USDJPY is lower (lower USD).
The ECB will announce its rate decision at 8:15. The central bank is expected to cut rates by 25 basis points to 2.9% from 3.15%. The press conference with ECB’s guard will start at 8:45 AM.
For the EURUSD technically, the price is trading above and below the 38.2% retracement of the move up from the January low to the January high. That level comes in at 1.03968. Current prices also knew the 50% midpoint of the move down from the December high at 1.0403 (the 50% of the trading range since 2022 is also near this area at 1.0405). So the range between 1.03968 and 1.0405 is the key barometer for buyers and sellers through the rate decision and the press conference. As always there could be increase volatility as the market digests all the information.
The Fed kept rates unchanged with some nuanced changes on inflation. They removed reference to progress, focusing instead on inflation remaining elevated, signaling potential ongoing concerns, but that was swept away by the Chair saying it was a “language cleanup”. Yields are lower today and ended the day yesterday with yields lower at least out the curve. The levels at the close yesterday showed:
- 2-year 4.219%, +1.5 basis points
- 5 year 4.339%, -0.5 basis points
- 10 year 4.536%, -1.3 basis points
- 30 year 4.778%, -1.2 basis points
In the US debt market today, yields are moving lower.
- 2 year yield 4.201%, -2.5 basis points
- 5 year yield 4.304%, -5.1 basis points
- 10 year yield 4.494%, down 6.1 basis points
- 30 year yield 4.734% down -5.6 basis points
US stocks are trading little changed/mixed in premarket trading implied by the futures
- Dow industrial average is trading down -53.52 points after falling 136 points or -0.31% yesterday
- S&P is trading up 7.19 points after falling -28.29 points or -0.47% yesterday
- Nasdaq is up 56 points after falling -101.26 points or -0.51% yesterday
After the close yesterday, Meta, Microsoft and Tesla reported along with IBM, and Lam Research also reporting:
- Meta Platforms Inc (META) Q4 2024: EPS $8.02 (BEAT; exp. $6.77), Revenue $48.39B (BEAT; exp. $47.03B). Shares are up 1.08% in premarket
- International Business Machines Corp (IBM) Q4 2024: EPS $3.92 (BEAT; exp. $3.75), Revenue $17.54B (MET; exp. $17.54B). Shares are up 8.21% in premarket
- Lam Research Corp (LRCX) Q4 2024: EPS $0.91 (BEAT; exp. $0.88), Revenue $4.29B (MISS; exp. $4.31B). Shares are up 6.% in premarket
- Microsoft Corp (MSFT) Q2 2025: EPS $3.23 (BEAT; exp. $3.11), Revenue $69.6B (BEAT; exp. $68.78B). Azure and other cloud services revenue growth of 31% (MET; exp. 31%). Shares are down -4.22% in premarket
- Tesla Inc (TSLA) Q4 2024: EPS $0.73 (MISS; exp. $0.75), Revenue $25.71B (MISS; exp. $27.21B). Shares are up 1.64% in premarket
A sampling of the earnings from today shows mixed results:
- Sherwin-Williams Co (SHW) Q4 2024: EPS $2.09 (MISS; exp. $2.06), Revenue $5.30B (MISS; exp. $5.32B).
- Altria Group Inc (MO) Q4 2024: EPS $1.29 (MET; exp. $1.29), Revenue excluding excise taxes $5.11B (MISS; exp. $5.40B). Shares are down -0.30% in premarket
- Comcast Corp (CMCSA) Q4 2024: EPS $0.96 (BEAT; exp. $0.86), Revenue $31.62B (MISS; exp. $31.64B). Shares are down -1.12% in premarket.
- Blackstone Inc (BX) Q4 2024: EPS $1.60 (BEAT; exp. $1.46), Revenue $3.08B (MISS; exp. $3.84B). Shares are up 2.25% in premarket.
- L3 Harris Technologies (LHX) Q4 2024: EPS $3.47 (BEAT; exp. $3.42), Revenue $5.52B (MET; exp. $5.55B). Shares are up 2.97% in premarket
- Northrop Grumman Corp (NOC) Q4 2024: EPS $6.39 (MISS; exp. $6.35), Revenue $10.69B (MISS; exp. $10.91B). Share are down -0.33% in premarket
- Quest Diagnostics Inc (DGX) Q4 2024: EPS $2.22 (BEAT; exp. $2.19), Revenue $2.26B (MISS; exp. $2.25B).
- Southwest Airlines Co (LUV) Q4 2024: EPS $0.56 (BEAT; exp. $0.44), Revenue $6.93B (MISS; exp. $6.96B).Shares are down -2.69% in premarket
- Caterpillar Inc (CAT) Q4 2024: EPS $5.14 (BEAT; exp. $5.02), Revenue $16.2B (MISS; exp. $16.39B).Shares are down -3.11%
- PulteGroup Inc (PHM) Q4 2024: EPS $4.43 (BEAT; exp. $3.27), Revenue $4.7B (BEAT; exp. $4.46B).Shares are up 4.91%
- Cigna Group (CI) Q4 2024: EPS $6.64 (MISS; exp. $7.82), Revenue $65.68B (BEAT; exp. $63.36B). Shares are down -8.84% in premarket
In other markets today:
- Crude oil is trading down $0.15 or -0.19% at $72.45
- Gold is trading up $21 or 0.76% at $2779.60
- Silver is trading up $0.25 or 0.91% at $31.10
- Bitcoin is trading up $1200 at $104,987
On the ecoomic calendar today, the highlight is the 1st look at Q4 GDP. The Atlanta FedGDPNow growth estimate came in at 2.3% down from 3.2% after inventory and trade data took a big chunk out of growth.
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8:30 AM (USD):
- Advance GDP q/q: Forecast 2.6% (Previous 2.8%).
- Unemployment Claims: Forecast 220K (Previous 223K).
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10:00 AM (USD):
- Pending Home Sales m/m: Forecast 0.0% (Previous 2.2%).