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  • S&P 500 Futures fade the previous day’s recovery moves as market sentiment turns cautious ahead of the key events.
  • China’s upbeat inflation figures, Yellen’s promise for more aid to state/local governments also fail to recall the bulls.
  • US 10-year Treasury yield pauses earlier pullback from multi-day high, Asia-Pacific shares trade mixed despite Wall Street’s gains.

S&P 500 Futures fail to track Wall Street’s upbeat performance, currently down 0.25% around 3,864, as risk dwindles during early Wednesday. The reason could be traced from the market’s cautious sentiment ahead of the much-awaited coronavirus (COVID-19) stimulus from the US policymakers.

Although American Congress is in the final stages of announcing the $1.9 trillion aid package, fears of witnessing any disappointment seem to weigh on the mood. This undermines comments from US Treasury Secretary Janet Yellen who earlier tried to placate bears while suggesting more and faster helps for state/local governments, as well as upbeat economic recovery.

Elsewhere, the Reserve Bank of New Zealand (RBNZ) rolled back some of the excess liquidity measures introduced during the pandemic times, indirectly suggesting reflation fears, whereas the Swiss National Bank (SNB) official sounded mostly upbeat.

It should be noted that February’s better-than-forecast Consumer Price Index (CPI) and Producer Price Index (PPI) from China also backed the reflation fears and paused the US 10-year Treasury yield’s pullback marked the previous day. Also portraying the risk-off mood could be the sluggish moves by the Asia-Pacific shares even as Wall Street cheered market optimism the previous day.

Read:  Wall Street Close: Bulls cheer stimulus hopes, pullback in US Treasury yields

As no major data/event is left for publishing during Asia, investors are likely to remain cautious, while offering a sideways move, ahead of the key event. Other than the stimulus news, US inflation figures for February also become important to watch.

Read:  US CPI February Preview: A perfect storm in the making?