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Key Futures Market Indicators that Affect Investors

In Financial Futures
by Michael Wayne at 5:00 am on February 8, 2011 - [edit]

Futures trading means understanding the futures markets and what makes them tick.  In this era of 24/7 news that permeates our culture, it is no surprise that the futures markets are extremely volatile and liquid.  Have you tried obtaining a mortgage lately?  Or maybe tried to refinance your existing mortgage, trying to lock into a piece of the recent record-low interest rates?  If so, you have likely experienced the daily ups and downs of the markets, and the key futures market indicators that affect them.

Many of the key market indicators are released on a monthly basis, early in the morning shortly after the opening bell.  We have a listing below with brief details on each, including approximate announcement dates.

Retail Sales

With a release date around mid-month, this very important report shows the prior month’s spending trends of US citizens.  If consumers are spending, retail sales data would be a strong market indicator of a healthy, booming economy.  Oppositely, report data detailing weak spending levels would be a solid indicator of the consumers’ unwillingness to part from a hard-earned wage.

Non-Farm Payroll

This report is released on the morning of the first Friday of each month, with job statistics based on the prior month data.  Recently, the private sector has been hit hard with high unemployment rates, resulting in negative trending.  On the flip side, in the late 1990′s and into the early 2000′s…the non-farm reports trended positive.  A savvy trader may spot these trends to their benefit.

Consumer Price Index (CPI)

Also released around mid-month, the CPI tracks the consumer goods pricing.  Take food, or more specifically corn.  You can take knowledge from a report like this when looking into corn futures contracts.  With factors like weather influencing the demand for corn supply, it is likely that food prices are going to rise or fall.

ISM Index

Released on the morning of the first business day of each month, this report details a general indication of the state of manufacturing in the US.  If you hold a position of influence within a manufacturing environment…you likely have taken part in an ISM survey.  Data from these surveys makes up the majority of the report – resulting in a higher, lower, or steady rating.

Other important indicators are the Housing Starts, Consumer Confidence, and Durable Orders reports are also important reports that can show patterns in the economy that reflect a boom or a recession.

Some of the Weekly Reports that futures traders are monitoring for key futures market indicators include the following (please note – holidays sometimes throw these off a bit):

  • USDA Grain Inspections (Monday mornings)
  • USDA Crop Progress Reports (Monday afternoons during the actual crop growing season)*
  • USDA Florida Weather Crop Report (Monday afternoons)
  • Federal Reserve Statistical Release on Mondays – FRB/BOG Daily Rate Update
  • DOE Petroleum Status Report (Wednesday mornings)
  • Jobless Claims (seems to be all the time lately – but actually Thursday mornings)
  • USDA Export Sales (Thursday mornings)
  • US DOE Natural Gas Storage (Thursday mornings) View latest report
  • AAR Railroad Traffic Report (Thursday afternoons)
  • USDA Cheese/Milk/Whey Product Prices report for previous week (Friday mornings) View latest report

We have begun updating all of the above reporting times in an easy to use, easy to share, Google calendar in our Trading Tools section.  To view that Futures Markets Economic Release Calendar, please click here.

*Effective 2011, the USDA’s National Agricultural Statistics Service (NASS) has discontinued the weekly Weather-Crop Summary reports that were previously published every Tuesday at noon.  Weekly crop updates are now done exclusively through this report.

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