US open: Futures steady, jobless claims at fresh pandemic low
Fiona Cincotta September 9, 2021 8:58 AM
US stocks look set for a very mildly softer open. US jobless claims hit a fresh pandemic low. The upbeat data has't managed to disperse the cloud hanging over the markets this week.
Dow futures -0.03% at 34983
S&P futures -0.02% at 4508
Nasdaq futures -0.01% at 15612
FTSE -1.2% at 7012
Dax -0.19% at 15594
Euro Stoxx -0.18% at 4170
Futures head a few ticks lower
US stocks area heading towards a mildly softer open, extending losses for a fourth straight session despite encouraging jobless claims data.
Initial jobless claims rose by 310k, the lowest level since the pandemic started and last weeks’ was also revised lower to 345k. Whilst jobless claims are trending in the right direction they weren’t remarkable enough for the market to shake off the grey cloud which has been looming over the markets this week.
Uncertainty over the timing of the Fed’s plans to taper coupled with concerns over slowing economic growth have dragged on sentiment keeping bulls on the sidelines as stocks fall back from record highs. Whilst the move lower has been technically significant for the Dow, an index more closely tied to cyclical stocks, which has slipped below the 50 sma. The move lower so far on the S&P is not so far technically significant, thanks to high growth tech stocks which have continued to draw inflows.
That said, tech stocks but more particularly gaming stocks will be under the spotlight amid the ongoing crackdown in China. Beijing has temporarily suspended approval for all new online video games. US listed gaming stocks such as Roblox, Activation Blizzard and Take-Two have fallen pre-market.
Where next for the S&P 500?
The S&P500 continues to trade in its ascending channel dating back to early May. After hitting an all time high of 4550 the price has been easing lower. However, the overall trend remains bullish and no key levels have been breach so far. Support could be tested at 4465 and 4427 the 50 sma. A break below here could see sellers gain traction to 4350. A move beyond 4550 is needed for fresh all time highs.
FX – USD falls on Fed uncertainty, ECB tapers
The US Dollar is edging lower amid growing concerns over the health of the US economic recovery and after Atlanta Fed President Raphael Bostic said that it is unlikely that the Fed will move to taper bond purchases at the September meeting. After the ECB’s move this highlights policy divergence between the 2 central banks.
EUR/USD – The ECB voted to keep interest rates unchanged, as expected. The central bank also agreed to moderately reduce the PEPP in Q4 but confirmed it will run until at least the end of March. In other words they took steps to dial back support but reassured that there would be plenty to come if necessary. The Euro has pushed moderately higher following the announcement. Attention is now on the ECB press conference.
GBP/USD +0.48% at 1.3813
EUR/USD +0.25% at 1.1840
Oil weighs up demand concerns vs slow output
Oil prices are holding steady on Thursday as demand concerns amid rising Delta covid cases offset a decline in output from the Gulf of Mexico owing to Hurricane Ida. Around 77% of production in the region has yet to start following on from the storm.
Separately the US Energy Information Administration cut its 2021 global oil demand outlook although the 2022 outlook remains constant. The move comes amid growing concerns over the health of the global economic recovery.
Yesterday API inventory data revealed that the crude drawdown was smaller than expected. EIA crude stockpile data is due later today.
US crude trades +0.06% at $69.20
Brent trades +0.12% at $72.47
15:30 EIA oil stock change
17:00 BoC Governor Macklem speech
19:00 Fed Williams speech
Disclaimer: The information on this web site is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement. The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency or CFD contract. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. Any references to historical price movements or levels is informational based on our analysis and we do not represent or warranty that any such movements or levels are likely to reoccur in the future. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.
Futures, Options on Futures, Foreign Exchange and other leveraged products involves significant risk of loss and is not suitable for all investors. Losses can exceed your deposits. Increasing leverage increases risk. Spot Gold and Silver contracts are not subject to regulation under the U.S. Commodity Exchange Act. Contracts for Difference (CFDs) are not available for US residents. Before deciding to trade forex and commodity futures, you should carefully consider your financial objectives, level of experience and risk appetite. Any opinions, news, research, analyses, prices or other information contained herein is intended as general information about the subject matter covered and is provided with the understanding that we do not provide any investment, legal, or tax advice. You should consult with appropriate counsel or other advisors on all investment, legal, or tax matters. References to Forex.com or GAIN Capital refer to GAIN Capital Holdings Inc. and its subsidiaries. Please read Characteristics and Risks of Standardized Options.