S&P 500 Choppy after DOJ’s NVDA Inquiry, Softer JOLTs Data

Also 30-year T-Bond, Silver, Natural Gas, and Canadian Dollar Futures 

1. S&P 500 E-mini futures (/ES): -0.08% 

2. 30-year T-bond futures (/ZB): +0.23% 

3. Silver futures (/SI): +0.37% 

4. Natural gas futures (/NG): +1.32% 

5. Canadian dollar futures (/6C): +0.05% 

Yesterday’s rout to start September trading is finding little follow-through today, with U.S. equity markets shuffling between gains and losses early in the session. The morning’s slate of U.S. economic data continued to point to a slowing growth situation, with the August U.S. job openings and labor turnover survey (JOLTs) showing a sharp drop-off in job openings (7.67 million vs 8.1 million expected). Treasury yields are moving lower as rate markets pull forward expectations of a 50-basis-point (bps) Federal Reserve interest rate cut in two weeks.

Elsewhere, energy prices continue to struggle, with crude oil below 70 per barrel for the first time since December 2023. 

The S&P 500 futures continued to fall this morning after traders learned the U.S. Justice Department issued a subpoena for Nvidia (NVDA), signaling further interest into an antitrust investigation of the company’s practices. The bellwether technology stock commands a lot of influence over market sentiment, given its high-flyer status. The rest of the market will have to pick up the slack for equity indexes to move higher today.  

The 30-year T-bond futures contract (/ZBZ4) is slightly higher but the upside seen yesterday has moderated, with prices up only about 0.08% ahead of the New York open. The Fed’s Beige Book and U.S. data on job openings may sway yields today before the focus shifts to Friday’s jobs report. There are no notable auctions scheduled for today from the Treasury.  

Silver prices (/SIZ4) trimmed losses from overnight, with prices holding above yesterday’s intraday lows. The metal has been heavily sold over the past two days, bringing prices to the lowest levels since mid-August. A stall in the dollar’s upside appears to be helping to support the metal today, but prices could remain at risk if China’s industrial activity continues to slow. 

Natural gas futures (/NGV4) rose today, extending gains from the day prior as traders start to focus on the winter season, when stockpiles typically draw down. The United States is seeing cooler weather, which should allow stockpiles to build further before colder temps sweep in. European demand has eased recently, reducing the premium Dutch futures hold over Henry Hub U.S. prices. Earlier this week, the Biden administration approved exports for U.S. sourced natural gas from Mexico, potentially increasing demand via that route. Focus shifts to tomorrow’s numbers from the Energy Information Administration.  

The Canadian dollar (/6C) is rallying back this morning in the wake of the September Bank of Canada (BOC) rate decision. BOC policymakers cut the main rate by 25-bps for the third consecutive meeting, bucking limited but meaningful 22% odds of a 50-bps cut. Policymakers continued to guide toward more cuts, which presents a potential read-through on the U.S. economy: about 80% of Canada’s exports head to the U.S., so if the Canadian economy is slowing, it stands to reason demand in the U.S. may be weakening. 

Christopher Vecchio, CFA, tastylive’s head of futures and forex, has been trading for nearly 20 years. He has consulted with multinational firms on FX hedging and lectured at Duke Law School on FX derivatives. Vecchio searches for high-convexity opportunities at the crossroads of macroeconomics and global politics. He hosts Futures Power Hour Monday-Friday and Let Me Explain on Tuesdays, and co-hosts Overtime, Monday-Thursday. @cvecchiofx

For live daily programming, market news and commentary, visit tastylive or the YouTube channels tastylive (for options traders), and tastyliveTrending for stocks, futures, forex & macro. 

Trade with a better broker, open a tastytrade account today. tastylive, Inc. and tastytrade, Inc. are separate but affiliated companies.