E-mini S&P 500 Futures (September): Settled at 3183.50, up 35.25
E-mini Nasdaq-100 Futures (September): Settled at 10,646.25, up 46.25
U.S. benchmarks finished strongly yesterday and gapped higher on the evening reopen for today’s session after positive Covid-19 vaccine news.
Moderna published the results of their Phase 1 trial late yesterday, it showed an immune response in all 45 patients with only minor side effects. This was a more detailed report than those May 18 headlines that led to a surge in risk-assets before questions overshadowed the enthusiasm. Moderna was up nearly 20% pre-market. Amid these bullish tailwinds, there are now expectations of good news to be announced surrounding Oxford University’s Covid-19 vaccine candidate backed by AstraZeneca. Bloomberg published an article calling Oxford’s team the front-runner. AstraZeneca is up nearly 5% pre-market. Pfizer and BioNTech are also gaining ground premarket up 1.5% and 4% respectively.
Goldman Sachs reported earnings this morning, blowing the roof off expectations at $6.26 a share versus expectations of $3.78 a share. With the strongest trading revenues in years, the company weathered a volatile second quarter very well. Their results though, when compared to some peers such as JPMorgan, were buoyed by less cash being set aside for bad loans. At the same time, it exudes the fears of such banks with a higher concentration to lending.
Yesterday, President Trump removed Hong Kong’s special status. Markets seemed unconcerned with the landmark decision that continues to signal a deteriorating relationship between the U.S. and China. Instead it traded higher on a problem only recently created and one that risk-assets never even traded lower on; the U.S. government will now allow international students to stay in the U.S. while taking online classes. Although the market was already grinding higher yesterday, it seemed that this headline got the ball rolling ahead of Moderna "officially" announcing their results (yes, we are alluding to the Moderna announcement already being known by a select few).
Fed Governor Lael Brainard, who is considered a centrist (dovish to hawkish), lit a fire under risk-assets yesterday calling for additional measures due to the ongoing risks and a slow recovery. Philadelphia Fed’s Patrick Harker who also spoke of the slow recovery yesterday, is considered to be more hawkish among the committee. He is a 2020 voter and his comments will be closely watched again today.
Tonight, a deluge of Chinese data that includes Q2 GDP and Industrial Production is due at 9:00 pm CT.
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