E-mini S&P 500 Futures (December): Settled at 3481, down 23.75
E-mini Nasdaq-100 Futures (December): Settled at 11,974.25, down 119.75
Risk-assets are down sharply overnight, and U.S. benchmarks are adding to yesterday’s losses. Stimulus hopes in Washington have all but disappeared, sucking risk-premium out across the board. The reality is, although a possibility, we never expected a Coronavirus Aid package from Congress before the election, but we remain very confident that something will get done after. It is not just Washington though, Covid-19 outbreaks in Europe are certainly weighing on risk-sentiment.
Germany and Italy reported record new infections and France announced a curfew. The U.S. is also seeing a resurgence in case numbers across the country. New restrictions could become the norm over the next few weeks. From a trading perspective, the S&P and NQ have moved into technical air pockets from the latter half of last week.
From an investing standpoint, without leverage, this is a bull market and dips are a buying opportunity until proven otherwise. Yesterday, only Industrials, Materials and Energy were positive, but even those are down more premarket today than they gained yesterday due to demand fears tied to the pandemic. With the tape exuding unenthusiasm for the current flow of news, patience will be key at the onset of U.S. hours and a failure to move lower through such aforementioned air pockets, detailed in the Technical section below, should present both trading and investing opportunities.
Central bankers from the BoE, Bank of Canada, ECB and Fed all speak through today. We look to comments from Dallas Fed President Kaplan and Fed Governor Quarles at 10:00 am CT. ECB President Lagarde speaks at 11:00 am CT. Crude inventory data is due at 10:00 am CT and expectations for a headline draw have come in a bit, also weighing on the Energy sector.
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