E-mini S&P 500 Futures (September): Settled at 3118.50, up 7.75
E-mini Nasdaq-100 Futures (September): Settled at 10,196, up 71.25
U.S. benchmarks were roiled yesterday as Covid-19 cases surged by roughly 35,000, the most since April. Volatility among risk-assets has certainly increased in the last 36 hours and isn’t conducive for the bull case. However, monetary and fiscal stimulus are. Without fresh sounds of new measures, risk-assets are due for additional pressures on fears the pandemic worsens domestically. Also lurking are geopolitical threats. The White House is considering $3.1 billion in new tariffs on the EU and U.K. Additionally, the U.S.-China trade war has fallen off the headlines since Monday night, but one must expect fresh developments around the corner; whether bullish or bearish. Remember, tensions remain on the Korean peninsula and on the China-India border.
On the economic calendar, final U.S. Q1 GDP was in line with expectations at -5.0%. Durable Goods data improved sharply but from a very low level. Initial Jobless Claims were more than expected at 1.48 million, however, the Continuing Claims read is quietly becoming more important and was better than expected at 19.522 million versus expectations of 19.968 million. Although an improvement from 20.289 million last week it remains 3-times previous record highs from 2009.
To key off the discussion of fresh monetary and fiscal stimulus measures discussed earlier, we look to a slew of Fed speakers throughout the day. Lastly, with markets under pressure, it wouldn't be surprising to hear comments on fiscal measures from Washington before the weekend.
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