S&P 500 Futures probe one-week high above 3,800 as US stimulus talks gain momentum

• S&P 500 Futures rises for the third consecutive day.
• US Treasury Secretary Yellen pushes for fiscal stimulus, Democrats eye budget resolution.
• Vaccine optimism, EU weakness and optimism in Asia-Pacific adds to the brighter mood.

S&P 500 Futures extend the latest upside momentum, currently up 0.35% intraday, during early Wednesday. The risk barometer seems to take clues from the US relief package developments while printing a three-day uptrend to probe January 27 high.

Following chatters of a Democratic push towards passing a resolution that will enable them to get the stimulus through the Senate without Republican help, comments from US Treasury Secretary Yellen strengthened odds of immediate fiscal relief. In her latest comments, the ex-Fed Chair quotes Congressional Budget Office (CBO) forecasts while stating the desperate need for the aid package.

It should, however, be noted that Axios came out with the news suggesting the US Chamber of Commerce’s request to President Joe Biden to not go around Republicans to pass the president’s $1.9 trillion stimulus package probe the risks.

Read: Market focussed back on the size of the Biden fiscal bonanza

On Tuesday, Wall Street benchmarks closed above 1.00% gains each while the US dollar index (DXY) refreshed a two-month high following the aforementioned catalyst. Also favoring the mood was downbeat Q$ GDP from the European Union (EU) as well as an absence of the market frenzy that stirred fears earlier.

It should be noted that New Zealand’s strong employment data and China’s better than forecast Caixin Services PMI, coupled with BOJ policymaker’s readiness to ease further, add to the market optimism. Though, RBA Governor Philip Lowe’s cautious comments test the bulls.

Moving on, US ADP Employment Change and ISM Services PMI, as well as Eurozone CPI, will be the key data to watch while keeping eyes on the risk catalysts for fresh impulse. It should, however, be noted that the pre-NFP trading lull is likely gaining pace and may challenge the market moves before Friday.