Officials at the U.S. central bank hinted that they would be open to the idea of tapering the bank’s bond purchases. All indicated a degree of openness, Richmond Fed President Tom Barkin, Atlanta’s Raphael Bostic and Dallas’ Robert Kaplan. That is to wind down stimulus from the Q4 in various public appearances.
The yield on the 10-Year Treasury bond was up further in response overnight. It rose to a new high for the year of 1.16%, keeping the dollar supported against the other currencies.
On Tuesday, there will be another barrage of Fedspeak, starting with Bostic again at 8:30 AM ET. Then, governor Lael Brainard at 8:35 AM.
Kaplan and Bostic both speak at 11 AM ET. The Cleveland Fed’s Loretta Mester speaks at 12 PM and her Kansas City counterpart, Esther George, speaks at 1 PM.
Stocks Set to Bounce
U.S. stock markets are set to open modestly higher, recovering some of Monday’s losses.
Dow Jones futures were up 76 points or 0.3% by 6:30 AM ET. S&P 500 futures were also up 0.3% and Nasdaq futures were up by 0.4%. Nasdaq Futures had the heaviest losses on Monday.
Stocks likely to be in focus again include the social media companies. They are now squarely in the middle of a new culture war over free speech and hate speech.
Moreover, medical device makers Cantel Medical (NYSE:CMD) and STERIS (NYSE:STE), as they are reported being in merger talks.
Oil Up Ahead of API
Meanwhile in other economic news, crude oil prices rose to fresh 11-month highs. It was bolstered by a combination of factors.
These factors range from faster rollouts of vaccines in the U.S., to expectations of a rebound in air travel in India. Furthermore, receding fears of lockdowns in China. This has been a rare bright spot for demand in recent months.
U.S. crude prices were up 1.4% at $53.01 a barrel by 6:30 AM ET. Brent futures were up 1.5% at $56.51.
The American Petroleum Institute will report its weekly assessment of U.S. crude inventories at 4:30 PM ET. Last week’s numbers were marked by the rare absence of imports from Saudi Arabia.
Elsewhere, German Chancellor Angela Merkel is considering a 10-week extension to the country’s lockdown. This is to effectively ensure that Europe’s largest economy remains suppressed by anti-Covid-19 measures for the whole of Q1.
