U.S. benchmarks rebounded yesterday from crucial levels of technical support. The session low came against our major 3-star support at the opening bell and a failure to go lower provided a tailwind for a pivotal intraday recovery despite an unenthusiastic news cycle.
Despite the Federal Reserve’s steadfast narrative that fiscal measures are necessary to keep the economic recovery moving, White House Economic Advisor Larry Kudlow said over the weekend he does not think the recovery is dependent on it.
Markets are anticipating fiscal measures from Washington to complement the Federal Reserve doubling its balance sheet in the last year. For all intents and purposes, it seems the President has figured out how trading algorithms work; if he creates a market event but quickly rescues it, algorithms will take the tape higher than it was prior to the event itself.
U.S. benchmarks are continuing yesterday’s strength in a snapback from Tuesday’s selling. The wave of weakness followed President Trump’s tweets on fiscal policy negotiations.
President Trump put the kibosh on the rally with a tweet storm calling for the Senate to end Covid-19 aid negotiations due to the House’s reluctance to come off its “$2.4 trillion” perch (although their number is $2.2 trillion), and instead focus on confirming Supreme Court Justice nominee Amy Coney Barrett.
In a tale of 3 indexes, the S&P 500 has recouped the losses from Thursday’s settlement and President Trump’s midnight announcement of contracting Covid-19.
U.S. benchmarks were sharply lower after an eventful evening and ahead of Nonfarm Payrolls data. House Democrats marginally passed a $2.2 trillion Covid-19 aid bill last night; the problem being, it does nothing to get a deal done.
Despite lower price action after the presidential debate, House Speaker Nancy Pelosi renewed a glimmer of hope early yesterday ahead of a self-imposed deadline tomorrow.
