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Monday, July 31, 2006

Are The S&P Futures Ready To Make Their Move?

Are the S&P futures ready to make their move? Since the middle of May, S&P futures have been a trend followers nightmare. Choppy action has been the norm, as both bulls and bears struggle to take control of the market. Much of the blame for the lack of trend can be contributed to the markets expectation for what the Federal Reserve has in store for interest rates and the outlook for inflation. Recently the expectations for a "pause" in the Fed's tightening campaign have increased, with Friday's disappointing 2nd quarter GDP figure helping to lower the odds of a rate increase to 30% according to the August Fed Funds contract. Normally, signs of a slowing economy would be bearish for stocks, as fears of slowing consumer and business spending would weigh on corporate profits. Read More....