S&P 500 Futures stay mildly offered above 3,400 amid a quiet Asian session
- S&P Futures catch a breather after heavy declines of Thursday and Friday.
- Brexit, Sino-American jitters join UN Chief’s comments to weigh on the trading sentiment.
- Challenges to the technology companies could weigh the outlook despite increasing odds of US stimulus.
- American holiday to keep the global markets dull amid a light calendar.
S&P 500 Futures struggle for a clear direction while taking rounds to 3,420/15 during the early Monday. The risk-barometer portrays the general market conditions amid a lack of major data/events, coupled with the mostly dead news feed. Even so, increasing risks to the trade deal between the UK and the European Union (EU) joins the US-China tension to weigh on the market mood. On the positive side, Friday’s upbeat US employment data gives an upper hand to the Republicans and suggest a sooner end to the stimulus talk deadlock.
Not only UK PM Boris Johnson’s push for a trade deal by October 15 but chatters that Britain may announce legislation changes to the Brexit accord also weighed on the market’s risk-tone at the week’s start. It should be noted that the EU-UK talks continue to offer no positive results despite almost eight attempts in recent times. While the Tories blame Brussels, the bloc leaders term Johnson and company a rigid one.
Adding to the market pessimism is the Beijing-Washington tussle that recently took clues after the Trump administration blacklisted China’s SMIC. The world’s top two economies have been at loggerheads for a long and have been delaying the much-awaited phase one trade deal, which in turn exerts additional downside pressure on the markets attacked by the coronavirus (COVID-19) woes. The US-China tussle directly attacked tech-giants during the last week after Beijing reported to have developed a five-year plan to ease dependence from the American chipmakers.
It should be noted that the latest figures from Victoria, Texas and Tokyo have been stabilizing but Brazil and India continue to struggle from the pandemic.
Further to add to the market worries could be the latest comments from the United Nations’ (UN) Secretary-General Antonio Guterres who said, as per Yonhap, “diplomacy is the "only pathway" to sustainable peace and denuclearization on the Korean Peninsula, urging the two Koreas and the United States to restart diplomatic efforts and resume their stalled dialogue.”
Even so, the absence of the US traders and a lack of major data/events restrict the market moves. However, China’s August month trade numbers and German Industrial Production may entertain intraday traders.
Read: The S&P 500 Weekly Forecast: More downside left to play for, target 61.8% Fib
Reprinted from FXStreet,the copyright all reserved by the original author.
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