Who would have guessed this morning that crude oil would be a bigger market moving story than the Fed meeting, but that’s the way markets go sometimes. WTI crude rallied Wednesday following a much bigger than expected drop in US crude oil inventories suggesting that the oversupply overhang continues to go away. Crude has been trending steadily downward in recent sessions and had been getting oversold so this news appears to have sparked a round of short covering and a trading bounce. Press reports going around suggesting that Saudi Arabia is considering trimming production back after the summer also helped to provide support but it’s unclear if that’s a reason for cautious optimism or wishful thinking. The FOMC statement took a totally neutral stand on interest rate liftoff, reminding me in some ways of the clear as mud Greenspan days and old joke of a US President wanting to hire a one handed economist because his advisors keep saying “on the other hand…“ While the statement indicated members seeing strong growth in the labour market (building the hawkish case) it also suggested inflation could remain low for a while (adding to the dovish case). No dissenters (dovish) was offset by no comments about the potential impact external crises (hawkish). Bottom line, both bulls and bears could take something out of a very non-committal statement. Next events that could spark FOMC speculation include tomorrow’s US Q2 GDP report, next week’s US nonfarm payrolls and August’s Fed Jackson hole conference where the central bank has signalled changes to policy trends in the past. The street is expecting a big rebound in Q2 GDP similar to the one we saw last year but data along the way has been mixed, so there’s potential for disappointment. A positive surprise would boost Fed hawks’ case while a miss would suggest a delay to liftoff possible. Really the big question on liftoff now is whether the Fed is going to wait for all the stars to align, or bite the bullet and just get started, because waiting carries risks as well related to getting caught behind the curve or overtaken by events. Facebook has been selling off in aftermarket trading dropping about 5% initially even though its earnings report beat expectations. The excuse remains to be seen at the time of writing, but the shares had already been pulling back from their 52-week high in recent days so port report trading suggests that traders still appear to more interested in finding reasons take profits against the news. One possible excuse is that desktop advertising was below expectations although strong mobile helped to boost total ad revenue above expectations. Rising costs may also be taking some of the blame. Regardless, the drop appears small relative to the 14.5% plunge Twitter’s shares took Wednesday after management comments crushed any optimism that came out of it beating the street. We may get a better ideal on which way Facebook could be heading after the conference call. Once again there’s not much in the way of big news scheduled for Asia Pacific countries, so the stock market crisis in China may remain front and centre with the big questions remaining how long can the government prop up stocks, and should it be intervening like this or are they just delaying the inevitable? Corporate News Facebook $0.50 vs street $0.47, sales $4.04B vs street $3.09B, daily users 968M vs street 960M Economic News Significant announcements released overnight include: US FOMC interest rate 0.25% no change expected US pending home sales (1.8%) vs street 1.0% US DOE crude oil inventories (4.2 mmbls) vs street 0.8 mmbbls Upcoming significant announcements include: 8:45 am AEST NZ building permits previous 0.0% 9:50 am AEST Japan industrial production street 0.3% 8:00 am BST Spain GDP street 3.1% 8:00 am BST Spain consumer prices street 0.0% 8:30 am BST Sweden GDP street 2.5% 8:55 am BST Germany unemployment change street (5K) 8:55 am BST Germany unemployment rate street 6.4% 9:00 am BST Norway retail sales street 0.8% 10:00 am BST Eurozone unemployment rate street 11.1% 1:00 pm BST Germany consumer prices street 0.1% 8:30 am EDT US Q2 GDP street 2.6% vs previous 0.2% 8:30 am EDT US core PCE inflation street 1.6% CMC Markets is an execution only service provider. The material (whether or not it states any opinions) is for general information purposes only, and does not take into account your personal circumstances or objectives. Nothing in this material is (or should be considered to be) financial, investment or other advice on which reliance should be placed. No opinion given in the material constitutes a recommendation by CMC Markets or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person.