Dallas Fed Manufacturing Index Drops To -17.5, Missing Analyst Expectations

Production Index declined from 0.7 in June to -1.3 in July, while New Orders Index decreased from -1.3 to -12.8.

Treasury yields continued to rebound from session lows as traders reacted to the report. The yield of 2-year Treasuries settled near the 4.40% level, while the yield of 10-year Treasuries moved towards the 4.18% level.

U.S. Dollar Index tested session highs after the release of the weaker-than-expected Dallas Fed Manufacturing Index report. Traders prepare for the Fed Interest Rate Decision, which will be released on Wednesday. From the technical point of view, U.S. Dollar Index managed to climb above the resistance at 104.40 – 104.60 and is trying to settle above the 104.75 level.

Gold pulled back below the $2385 level after an unsuccessful attempt to settle above the $2400 level. Strong dollar puts pressure on gold markets.

SP500 settled near the 5475 level as traders focused on the report. It remains to be seen whether Dallas Fed Manufacturing Index report will have a significant impact on SP500 dynamics as traders have already started to adjust their positions ahead of the Fed decision.

For a look at all of today’s economic events, check out our economic calendar.