US Stock-Index Futures Hit Record High on Tariffs Cancellation

US Stock-Index Futures Hit Record High on Tariffs Cancellation


Major US stock index futures hit a fresh all-time high amid ongoing trade optimism. Earlier today, China reported that the world's largest economies agreed on canceling additional tariffs imposed during their trade war. China and the US are going forward to reach a "phase one" trade agreement. Their willingness to strike a trade deal that would put an end to their trade disputes boosted the global stock market. The Dow Jones Industrial Average futures rallied to 27598, the S&P500 futures climbed to 3087, and Nasdaq advanced to 8263.


The dollar index, which measures the greenback against a basket of major currencies, settled flat at 97.95, awaiting fresh fundamental drivers. The FX market is digesting the trade optimism and the effect on Central Banks' monetary policy stance. A trade deal could support the global economic outlook and grant central banks additional time to assess the effect of their recent moves on their economies before choosing to act again. The Bank of England will be meeting today to discuss the monetary policy where the market widely expects the policy to remain unchanged. The GBPUSD is currently trading above $1.2870, and the EURUSD is hovering above $1.1080.


Gold prices remained under pressure amid enhanced risk sentiment. The ongoing optimism over trade between China and the United States is boosting the demand for riskier assets and weighing on safe-haven assets. The price of a gold ounce fell to $1486, the price of a silver ounce tumbled to $17.36, while palladium recovered partial losses and rose to $1805.


Oil prices trimmed yesterday's losses on tariffs headlines. On Wednesday, benchmarks dropped sharply as the US Energy Information Administration reported a buildup of 7.929 million barrels in US crude oil inventories last week. However, the positive trade headlines supported in recovering losses as the cancelation of tariffs is considered a step forward towards sealing the "phase 1" deal. The West Texas Intermediate crude futures rose to $56.93, and Brent futures surged to $62.35.

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