US open: Stocks rise ahead of ISM services data

US futures

Dow futures +0.42% at 31510

S&P futures +0.4% at 3948

Nasdaq futures +0.43% at 12167

In Europe

FTSE +0.34% at 73283

Dax +0.2% at 12960

Euro Stoxx -1.7% at 3670

A positive start after weeks of losses

US stocks are set to open higher after the Labor Day long weekend. The upbeat mood is well needed after three straight weeks of declines.

Stocks have been under pressure over the last month as Jerome Powell and Fed adopted a more hawkish stance, warning that the Fed will hike rates and keep them elevated to stamp out inflation.

The Federal Reserve is due to meet again later this month, and the market is pricing in a 68% probability of a 75 basis point rate hike; this is down slightly from 74% last week, following the non-farm payroll report.

While the NFP saw 315k jobs added, it also saw the participation rate rise, which should help ease the very tight labor market bringing wage growth down.

Looking ahead, attention will be on the release of the ISM non-manufacturing PMI data, which is expected to show a slight slowdown in growth to 55.5 from 56.7 in July. A strong report would be in contrast to the S&P Global US

Corporate news:

CVS rises pre-market after agreeing to buy Signify Health for $8 billion in cash. This will enable one of the largest healthcare companies to provide healthcare in patients’ homes.

Where next for the S&P500?

FX markets – USD rises, EUR falls

The USD is rising, tracking treasury yields higher. The USD rallied to a 2-year high in the previous session and is holding those gains ahead of the US data shortly.

EUR/USD is edging lower after German factory orders fell by more than expected in July, dropping -1.1%, after falling -0.4% in the previous month. This marked the 6^th straight month that industrial orders declined. Concerns over energy security continued to weigh on the EUR.

GBP/USD has rebounded from yesterday’s 2.5-year low, boosted by reports of an energy bailout. The new PM Liz Truss drafts a £130 billion plan to freeze energy prices for 18 months and drafts a £40 billion energy support plan for businesses. These supportive measures could enable the BoE to hike rates more aggressively, which is lifting the pound.

GBP/USD +0.5% at 1.1575

EUR/USD -0.04% at 0.9923

Oil falls on demand concerns

Oil is falling, snapping a three-day winning run. Oil heads back towards August lows as demand fears return, overshadowing concerns over the surprising supply cut from OPEC+ in the previous session.

New COVID lockdowns in China add to rising concerns over high inflation and more aggressive rate hikes in Europe and the US.

Yesterday OPEC+ cut output by 100k bpd, reversing the decision to raise output by the same amount in September.

WTI crude trades -2.6% at $86.96

Brent trades -2.3% at $92.70

Looking ahead

14:45 US services PMI

15:00 US ISM services PMI

From time to time, StoneX Financial Pty Ltd (“we”, “our”) website may contain links to other sites and/or resources provided by third parties. These links and/or resources are provided for your information only and we have no control over the contents of those materials, and in no way endorse their content. Any analysis, opinion, commentary or research-based material on our website is for information and educational purposes only and is not, in any circumstances, intended to be an offer, recommendation or solicitation to buy or sell. You should always seek independent advice as to your suitability to speculate in any related markets and your ability to assume the associated risks, if you are at all unsure. No representation or warranty is made, express or implied, that the materials on our website are complete or accurate. We are not under any obligation to update any such material.

As such, we (and/or our associated companies) will not be responsible or liable for any loss or damage incurred by you or any third party arising out of, or in connection with, any use of the information on our website (other than with regards to any duty or liability that we are unable to limit or exclude by law or under the applicable regulatory system) and any such liability is hereby expressly disclaimed.

FOREX.com is a trading name of StoneX Financial Pty Ltd.

The material provided herein is general in nature and does not take into account your objectives, financial situation or needs.

While every care has been taken in preparing this material, we do not provide any representation or warranty (express or implied) with respect to its completeness or accuracy. This is not an invitation or an offer to invest nor is it a recommendation to buy or sell investments.

StoneX recommends you to seek independent financial and legal advice before making any financial investment decision. Trading CFDs and FX on margin carries a higher level of risk, and may not be suitable for all investors. The possibility exists that you could lose more than your initial investment and CFD investors do not own or have any rights to the underlying assets.

It is important you consider our Financial Services Guide and Product Disclosure Statement (PDS) available at www.forex.com/en-au/terms-and-policies/, before deciding to acquire or hold our products. As a part of our market risk management, we may take the opposite side of your trade. Our Target Market Determination (TMD) is also available at www.forex.com/en-au/terms-and-policies/.

StoneX Financial Pty Ltd, Suite 42.01, 264 George Street, Sydney, NSW 2000 (ACN 141 774 727, AFSL 345646) is the CFD issuer and our products are traded off exchange.

Delayed London Stock Exchange (LSE) Data

The London Stock Exchange (LSE) market data displayed or referenced on this website is provided on a delayed basis and is not in real time. The delay period may vary but is typically at least 15 minutes. This data is intended for information purposes only and should not be relied upon for trading, investment, or other financial decisions. We do not guarantee the completeness, reliability, or suitability of the data for any particular purpose. Users should consult real-time data sources and obtain professional advice before making any financial decisions.