News

Stock Futures Ease as Virus Cases Soar

Equities

Major US stock index futures remained under pressure, losing vaccine-run gains. The coronavirus cases continued to soar in the United States, where the average new-cases per day rose by at least 5% during the past couple of days. Moreover, some states are looking forward to re-impose restrictions to stop the virus spread. On the other hand, during his participation in the ECB forum, the Federal Reserve Chairman Jerome Powell declared that the US economic outlook remains uncertain and that the vaccine is good news for the medium term. Also, he expressed the need for additional fiscal stimulus at a time where the Trump administration was stepping back from stimulus talks. The circulation of funds between the stay-at-home stocks and cyclical ones is significant, where the Nasdaq performed better than Dow Jones and S&P500. The Dow Jones Industrial Average futures declined to 28858, the S&P500 futures fell to 3517, while Nasdaq futures recovered to 11892.

USD

The dollar index, which measures the greenback against a basket of major currencies, was almost flat, trading near 93 awaiting fresh drivers. US treasury yields declined sharply, erasing gains earned on the vaccine headline, as coronavirus cases continued to rise, while the vaccine is still a bit away. Meanwhile, the Federal Reserve chairman Jerome Powell urged the government for further fiscal stimulus to cope with the latest wave of covid19.

Metals

Precious metals price traded near the upper bound of their recent range as the dollar softened with Treasury yields plunging. The price of a gold ounce hovered near $1880, the price of a silver ounce held steady near $24.30, while palladium futures inched higher to $2355.

Oil

Oil prices extended declines, surrendering early-week gains as the covid19 resurgence signaled further movement restrictions. Several states are re-adopting lockdown measures as the virus cases skyrocketed, which would impact oil consumption, while the vaccine optimism is fading. On the other hand, the US Energy Information Administration reported a buildup of 4.277 million barrels in US crude inventories. Market participants are looking forward to the OPEC+ Joint Ministerial Monitoring Committee meeting early next week. The West Texas Intermediate crude December delivery fell to $40.13, and Brent Blend January futures dropped to $42.65.

Major Economic Events

GMT Country Event Expectation Previous

10:00

EZ

 GDP (QoQ) (Q3) 

12.7%

-11.8%

13:30

US

 PPI (MoM) (Oct)

0.2%

0.4%

15:00

US

 Michigan Consumer Sentiment (Nov) 

82

81.8

16:00

UK

 BoE Gov Bailey Speaks 

-

-

 

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