Wall Street steady on Saudi optimism

US indices recovered early losses to finish marginally higher yesterday. Saudi Arabia said it had recouped about 50% of lost production and expects to be back to pre-attack levels by the end of the month. That’s an earlier time-frame than many had feared. The Federal Reserve is expected to cut rates at today’s FOMC meeting.

 

US30USD Daily Chart

Source: OANDA fxTrade

• The US30 index bounced off one-week lows to close slightly higher

• The 55-day moving average has edged up to 26,606, with prices trading above it since September 5

• The Federal Reserve is expected to trim its benchmark rate by 25 bps today. Market pricing is assigning a more than 80% probability of a cut, which is down from above 90% last week following the spike higher in oil prices on Monday.

 

DE30EUR Daily Chart

Source: OANDA fxTrade

• The Germany30 index fell for a second day yesterday, dropping to a one-week low before a mild rebound

• The 100-day moving average is at 12,114 and has supported prices since September 6. The 55-day moving average is just below at 12,083

• Euro-zone consumer prices are seen rising 0.2% m/m in August following a 0.5% decline in July. ECB’s De Guindos is due to speak today.

 

WTICOUSD Daily Chart

Source: OANDA fxTrade

• Crude oil prices gave back almost half of Monday’s gains yesterday after Saudi Arabia announced it expected to be fully back online by end-September

• The 100-day moving average is at $56.95 today and could be the first technical support point

• EIA crude oil inventory data as at September 13 are due to be published today. Expectations are for a drawdown of 2.9 million barrels after a 6.9 million barrels decrease the previous week.