The US stock market dropped quite sharply in the overnight futures session on low liquidity as most investors sat out waiting for Jerome Powell's speech in Sweden on the future of monetary policy. However, the speech, mainly focusing on the FED acting independently from political factors, did not mention any change in the FED's outlook after last week's jobs report nor ahead of Thursday's CPI index. Liquidity immediately improved after a few minutes of opening with selective buying emerging in a few mega cap techs, pulling SPY back right below call wall 390 with most other markets not showing much movement.
Notably, European stocks continue to outperform the US over the past 12 months:
In the currency market, investors continue to price-in lower-than-FED-forecast rate hikes and continue to believe that the FED will have to start pivot from mid-2023:
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