October MMT Chart and a Caution Signal From the VIX
What’s in Today’s Report:
- October MMT Levels – S&P 500 Chart
- Technical Observation: VIX vs. SPX Caution Signal
Futures turned higher with Treasuries overnight after the Bank of New Zealand cut policy rates by -50 bp to 2.50% vs. (E) -25 bp, a dovish surprise aimed at spurring growth.
Economically, Taiwan’s CPI remained low at 1.25% y/y while German Industrial Production plunged -4.3% vs. (E) -1.0% but the downbeat data is bolstering dovish central bank policy bets and buoying both bond and equity markets this morning.
Looking ahead to today’s session, the void of government economic data continues and there are no notable private sector releases today which will leave markets continuing to focus on Treasury auctions and Fed speak.
Regarding the first of those two topics, the Treasury will hold a 4-Month Bill auction at 11:30 a.m. ET and a (more important) 10-Yr Note auction at 1:00 p.m. ET.
Regarding the second topic, the Fed’s Musalem (9:20 a.m. ET), Barr (9:30 a.m. & 5:45 p.m. ET), Kashkari (3:15 p.m. & 4:30 p.m. ET), and Goolsbee (7:15 p.m. ET) are all scheduled to speak today.
And finally, the September FOMC meeting minutes will be released at 2:00 p.m. ET, and any evidence that pushes back on the thesis that the Fed will cut two more times in 2025 could send the dollar and yields (potentially sharply) higher and weigh meaningfully on equities.
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