Nasdaq 100 Turns Positive as GDP, Claims Trump NVDA Earnings

Also, 10-year T-note, gold, crude oil and Japanese yen futures

1. Nasdaq 100 E-mini futures (/NQ): +0.33% 

2. 10-year T-note futures (/ZN): -0.23% 

3. Gold futures (/GC): +0.15% 

4. Crude oil futures (/CL): +0.91% 

5. Japanese yen futures (/6J): -0.62% 

Move over, Nvidia earnings; recession concerns are in the spotlight now. T0day’s data releases showed 2Q’ 24 U.S. Gross domestic product (GDP) was revised higher to 3%, while weekly jobless claims came in better than expected. Good news is good news, which is leading to relaxed “recession” trades: Stocks are higher, bonds are weaker, oil is up and the U.S. dollar is rebounding. Today is likely to shape up as the busiest trading day of the week as the long holiday weekend beckons. 

Nvidia (NVDA) earnings didn’t impress investors yesterday, but a better-than-expected United States GDP helped revive sentiment ahead of the opening bell, pushing Nasdaq 100 contracts (/NQU4) about 0.4% higher. Dollar General (DG) was down over 25% this morning after the retailer cut guidance and cited weak consumer spending. Affirm Holdings (AFRM) rose nearly 25% in pre-market trading, as investors digested the latest earnings and upbeat guidance delivered by the company yesterday after the market close. 

Yields rose after a better-than-expected GDP print reduced the need for the Federal Reserve to cut interest rates. The chances for a cut next month remained at 100%, but bets further out gyrated on the data. 10-year T-note futures (/ZNZ4) fell about 0.23% ahead of the New York open. The Treasury is scheduled to auction seven-year notes today.  

A surging dollar weighed on gold prices (/GCZ4) today as the U.S. economic outlook brightened after the GDP data update. Traders trimmed gains following the report’s release, but prices remain slightly higher on the day. Tomorrow’s inflation data could offer the metal its next directional cue as prices hover near recently traded all-time highs. A lighter-than-expected print would likely support further upside for the metal.  

Crude oil prices (/CLZ4) rebounded today after two losing days as traders weighed supply disruptions in Libya. The Energy Information Administration (EIA) reported a smaller-than-expected inventory draw for oil in the latest weekly report, while gasoline inventories saw a larger-than-expected draw and distillates posted a surprising build. While supply chain issues and geopolitics continue to hold sway, U.S. inventory figures point to cooling demand as the summer driving season comes to a close. 

Fading fear of recession is lifting U.S. Treasury yields, which in turn is helping to feed the rebound by the U.S. dollar. The greenback is up across the board save vs. the Australian dollar (/6AU4), which itself is enjoying the tailwind of higher commodity prices—a notable development despite the stronger U.S. dollar. The rates-sensitive Japanese yen (/6JU4) is the loss leader as traders reduce safe haven exposure, even with the long holiday weekend ahead. 

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

Thomas Westwater, a tastylive financial writer and analyst, has eight years of markets and trading experience. @fxwestwater

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.