19 July 2019 (8:35 am IST)
18 July 2019 (11:05 pm EDT)
US stock markets started their overnight session with highly negative numbers but recovered those losses to close positive after a comment from the New York Federal Reserve President John Williams gave markets hope of a 50 basis points rate cut in this month’s FOMC meeting.
Although, the NY Fed later clarified that Williams was just giving an academic example when he said that central banks need to act quickly in case of economic slowdowns, and not declaring any “potential policy actions.”
Despite that clarification, world stock markets are still trading with gains, reversing their gloomy mood of the previous few sessions. US and European stock futures are showing substantial gains at this hour. All major Asian stock markets are trading positive. SGX Nifty has also turned positive after yesterday’s losses, indicating a positive opening for Indian stock markets today.
However, day traders should remain cautious about this early positive trend in world stock markets because it is based on a remark by a Fed official that markets misunderstood. This means that US stock futures will dominate the global trend and their intraday trading pattern may also dictate the trend in world stock markets.
Expect a positive but volatile intraday trend in world stock markets today. Any news or comment from the Federal Reserve officials can roil markets in any direction, up or down.