E-mini S&P 500 (December): Settled at 3353.25, down 39.75
E-mini Nasdaq-100 (December): Settled at 11,273.25, down 195.50
With less than 90 minutes left in the session, the S&P 500 index was nearing its September 16 swing high from after the FOMC statement and the Russell 2000 was breaking out to the highest level since February. 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.
Volatility ensued and the S&P 500 finished 2% off its high, but not before the tape pulled a Pac-Man and tagged stops above the 3419.50 high on September 16 by trading 3421.75 after the tweets had begun. The Russell finished 2.6% from its new swing high and the Nasdaq-100 2.2% from another failure at major 3-star resistance.
Each index bled into the electronic close, but none set a new low overnight on today’s session. The President in a tweet last night emphasized his readiness to send $1,200 stimulus checks to individuals immediately if House Speaker Nancy Pelosi was willing to sign a “stand alone bill”. This soothed the market, signaling that the President isn’t giving up. As each politician jockeys ahead of November elections they’re posturing to their base. The result: what could at times be simple legislation, turns into extended debates as articles are included that may not even be necessary to accomplish the broader goal.
Another narrative traders should keep an ear to the ground on are comments from the House’s antitrust report on big tech and a potential push to break them up. This could severely cripple the Nasdaq-100 and markets broadly.
On the economic calendar today, we look to the September FOMC Minutes released at 1:00 p.m. CT. Yesterday, Fed Chair Jerome Powell reemphasized the steadfast notion that Congress must pass fiscal measures to support the economy. Minneapolis Fed President Kashkari reiterated the same point this morning. In fact, European Central Bank President Christine Lagarde, amid sinking German Industrial Production data earlier, said that central banks must be on guard of premature withdrawal of stimulus. We get additional comments from Kashkari, a 2020 voter, at noon CT. Also, at that time there is a 10-year U.S. Treasury Note auction. New York Fed President John Williams, a permanent voting seat, speaks at 2:00 p.m. CT and Chicago Fed President Charles Evans a 2021 voter, speaks at 3:30 p.m. CT.
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