Top 5 Things to Know in the Market on Tuesday

Un trader nella sala operatova di una banca. REUTERS/Brendan McDermid

Here are the top 5 things you need to know in financial markets on Tuesday, September 20:

1. Fed kicks off 2-day policy meeting

The Federal Reserve begins its two-day policy meeting on Tuesday. While the overwhelming consensus is for the Fed to hold rates steady at the conclusion of its policy meeting on Wednesday, some market players expect it to drop a clearer hint that it is ready to raise rates by December.

Markets are currently pricing in just a 12% chance of a rate hike this week, according to Investing.com’s Fed Rate Monitor Tool. For December, odds stood at around 59%.

2. Bank of Japan decision looms

The market is also waiting for the outcome of a Bank of Japan policy meeting on Wednesday, with speculation rife that the Japanese central bank will make crucial changes to its easing program.

Speculation points to a possible interest rate cut deeper into negative territory, tweaks to its asset-purchase program or new rules on the duration of securities it will purchase in the bond market.

The BOJ has already implemented negative interest rates and is printing 80 trillion yen ($750 billion) a year to stimulate inflation after decades of deflation and stagnant growth, yet inflationary expectations appear to be weakening.

3. Oil falls towards 6-week lows after Venezuela warns on glut

Oil prices retreated on Tuesday, falling towards six-week lows, after Venezuela said that global supplies needed to fall by 10% in order to bring production down to consumption levels.

Global oil supply of 94 million barrels per day needs to fall by about a tenth if it is to match consumption, Venezuela’s Oil Minister Eulogio Del Pino said on Monday.

Brent was down 15 cents, or 0.35%, to $45.82 a barrel during morning hours in New York, while U.S. crude dipped 16 cents, or 0.35%, to $43.70.

4. Global stocks mixed as traders gear up for central banks

U.S. stock index futures pointed to a marginally higher open on Tuesday morning, as investors awaited policy decisions from the Federal Reserve and the Bank of Japan.

Meanwhile, European and U.K. stocks pushed higher in choppy mid-morning trade, as investors awaited the start of the Federal Reserve and Bank of Japan policy meetings.

Earlier, Asian shares ended mixed, as investors remained cautious before the Federal Reserve and the Bank of Japan policy setting meetings this week.

5. Dollar slips ahead of Fed, BOJ meetings

The dollar slipped lower against the other major currencies on Tuesday, as investors became more cautious ahead of the Federal Reserve and Bank of Japan’s highly-anticipated policy meetings this week.

The U.S. dollar index, which measures the greenback’s value against a basket of six major currencies, fell 0.1% to 95.70 early Tuesday. On Friday, it touched 96.11, its strongest level since September 1.

Against the yen, the dollar fell nearly 0.2% to 101.70 after touching a session low of 101.55, which was the lowest level since September 13.

The euro, meanwhile, inched up 0.15% to 1.1190.

 

Source:Investing.com

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