- S&P 500 Futures gain 23 points or 0.73% to 3,084 following Monday’s recovery moves.
- The Fed took steps to combat the fears of coronavirus (COVID-19).
- Hopes of US-China talks, V-shaped recovery add to the optimism.
- Qualitative catalysts to direct market moves ahead of Fed Chair Powell’s testimony.
S&P 500 Futures gain stays positive above 3,080 during the initial Asian session on Tuesday. The market’s risk barometer keeps the previous day’s sharp recovery moves from 2,925 while praising the Fed’s efforts to fight against pandemic fears.
The US Federal Reserve (Fed) recently announced the expansion of its corporate bond purchases as well as opened doors for non-profit organizations for lending. In doing so, the US central bank managed to tame the previous pessimism backed by the fears of the virus outbreak 2.0.
Also supporting the risk-on sentiment could be the expectations of the US-China talks in Hawaii. Further, the US government’s permission to four Chinese flights in a week and upbeat comments from the White House Economic Adviser Larry Kudlow adds to the upbeat trading sentiment.
On the contrary, Beijing flashed risk warnings relating to the latest second wave of the deadly disease. Moreover, news that the US Food and Drug Administration (FDA) warns over the reduced effectiveness of the much-championed COVID-19 drug Remdesivir raise bars for the bulls.
Other than the S&P 500 Futures, the US 10-year Treasury yields and Japan’s Nikkei 225 also portrays the positive feeling of the traders. The US 10-year Treasury yields gain five basis points (bps) to 0.75% whereas Japan’s equity gauge gains near to 3.0% as taking the bids near 22,135.
The qualitative catalysts, concerning the virus and the US-China relations, are likely to keep the driver’s seat. Even so, the Fed Chair Jerome Powell’s testimony will be the key event of the day considering the central bank leaders’ latest pessimism.
Read: Federal Reserve Chairman Powell Testifies in Congress: Some optimism would be nice
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