- S&P 500 Futures stay positive around Monday’s top, bulls catching a breather though.
- Upbeat earnings, increasing odds of nearness to virus cure keep the risk-on mood intact.
- US President Trump signed executive order to shun Hong Kong’s special trading status, also said more to come for China.
S&P 500 Futures print 0.80% gains on a day while taking rounds to 3,210 during the initial hour of Tokyo open on Wednesday. The risk barometer jumped the previous day following an upbeat performance by the US banks and the gains were stretched as latest updates suggest nearness to the coronavirus (COVID-19) vaccine. However, bulls seem to catch a breather off-late as pandemic figures from the US states suggest the worst isn’t over.
Earnings from major banks like JP Morgan and Citi made it clear that the policymakers’ pumping of the economy has its benefits. The upbeat announcements helped Wall Street benchmarks to lure the bulls on Tuesday. The moves to additional push after Moderna cited ‘robust’ outcome of the third trial and US President Trump reiterated that the vaccine will be out soon.
However, the signing of the executive order to take away Hong Kong’s special trading status and alleging China for the global virus outbreak by the US leader tame the bulls. The Republican leader also cited more hardships for china. Though, Global Times shrugs off the action while indicating that Beijing expected more from the US.
Other than the anticipated escalation in the Sino-American tussle, rising pandemic numbers from the key US states also challenge the latest risk-on sentiment. Be it Texas or Nevada, not to forget Los Angeles County, Americans are the major sufferers of the deadly virus. The latest coronavirus update marks another round of record numbers from the world’s largest economy.
Amid all these plays, US 10-year Treasury yields increase 2.2 basis points to extend the previous day’s run-up towards 0.64%. Further to portray the risk-on mood, Japan’s Nikkei 225 and Australia’s ASX 200 are both flashing gains over 1.0% by the press time.
Looking forward, traders will keep eyes on the Bank of Japan’s (BOJ) monetary policy meeting while also taking note of the risk catalysts for near-term trade direction.