News

US Stock Futures Rally to Record High on Fresh Trade Optimism

Equities

Major US stock-index futures extended positive rally logging fresh record high on trade optimism. The rally started following PBOC measures to support the economy and financial markets, continued on positive reports on Coronavirus and strong US economic data.  Lastly, the stock market earned a significant boost as the Senate voted to acquit Trump of charges in the impeachment trial, and China decided to halve tariffs on hundreds of US products. All the mentioned factors contributed to the latest surge in stocks. The Dow Jones Industrial Average futures rose to 29475, the S&P500 futures climbed to 3352, and Nasdaq futures advanced to 9462. Also, the Shanghai composite extended recovery to 2876, up 7.2% from Tuesday's low of 2685.

USD

The dollar index, which measures the greenback against a basket of major currencies, soared to a two-month high of 98.33 on upbeat US economic data. In addition to the sold ISM Manufacturing PMI reading and better-than-expected factory orders, the ADP Nonfarm Employment Change came in at 291 thousand beating estimates of 156 thousand, and the ISM Non-Manufacturing PMI surged to 55.5 versus an expectation of 55.0. The solid data drove US Treasury yields higher where the 10-year yields scored a one-week high of 1.686%. Meanwhile, the USDJPY climbed to 109.98, and the EURUSD dipped to $1.0993.

Metals

Gold prices continued to trade in a tight range as coronavirus threat kept risk appetite in check. The price of a gold ounce found support near $1549, and resistance at $1560, the price of a silver ounce rose to $17.74, while palladium futures plunged to $2303.

 

Oil

Oil prices rose for the second consecutive day despite a buildup in US inventories. The US Energy Information Administration reported a rise of 3.355 million barrels in US crude oil inventories last week. However, the positive stock market rally and Chinese decision to cut tariffs on US products drove prices higher. The West Texas Intermediate crude futures rose to $52.16, and Brent futures climbed to $56.56.

Major Economic Events

GMT Country Event Expectation Previous

8:00

EU

ECB President Lagarde Speaks  

 

 

10:00

EU

EU Economic Forecasts  

 

 

13:30

US

Initial Jobless Claims

215

216

13:30

US

Nonfarm Productivity (QoQ) (Q4) 

1.6%

-0.2%

13:30

US

Unit Labor Costs (QoQ) (Q4) 

1.4%

2.5%


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