[Platinum Insights] (5.15.23)

Good morning.  

U.S. stock index futures edged higher on Monday amid optimism that lawmakers will reach an agreement to raise the U.S. debt limit to avoid a catastrophic default, and ahead of speeches by Federal Reserve officials lined up through the week.  

Treasury Secretary Janet Yellen hinted over the weekend that the U.S. would avoid a default. “I’m hopeful. I think the negotiations are very active. I’m told they have found some areas of agreement,” said Yellen.   

Additionally, traders will closely monitor appearances by several Federal Reserve officials throughout the week.   

WTI crude futures traded above $70 per barrel. Gold prices rose above $2,010 an ounce while the yield on the US 10-year Treasury note was around 3.48%.  

Investors have become concerned about the impact that elevated interest rates will have on the U.S. economy, with many fearing a recession. Fresh economic data expected this week could provide new clues about the economic outlook.  

A regulatory filing on Friday from the family office of George Soros showed the 92-year old billionaire investor has sold his entire stake in Tesla. Soros bought shares in the electric vehicle maker, run by Elon Musk, in 2022, as well as convertible bonds in 2018.  

Last week, the Dow and S&P 500 tumbled 1.11% and 0.29%, respectively, as concerns about the debt ceiling, banking sector risks and the broader economy dampened investor sentiment. 

Meanwhile, the Nasdaq Composite rose 0.4% as megacap technology names continued to outperform the market. Small cap stocks have struggled with the Russell 2000 down 7% since March 8. Investors fear that smaller firms will be hit hard by a potential lending slowdown that could weigh on the broader economy.  

Check out last week’s Platinum ZOOM call where we discussed trading in a range-bound market.  

Have a great day!  

This information is for educational purposes and is not a recommendation to buy or sell a stock.