S&P 500 Futures: China, coronavirus entertain bears, Fed in focus
|- S&P 500 Futures print three-day downtrend, pressured around one-month low.
- Evergrande headlines, virus woes and West versus China keep sellers hopeful amid anxiety ahead of FOMC.
- Off in China, Japan and a light calendar challenges momentum traders.
S&P 500 Futures stay depressed around monthly low, down 0.15% intraday near 4,415 during Monday’s Asian session.
The risk barometer dropped during the last two days amid risk-off mood but remains idle of late, still on the bear’s radar, as a baking holiday in China and Japan joins a light calendar elsewhere. Also challenging the trades is the cautious sentiment ahead of Wednesday’s Federal Open Market Committee (FOMC).
Even so, fears of a Lehman-like collapse of China’s Evergrande and mixed coronavirus updates weigh on the risk appetite. Also challenging the mood could be the uncertainty over the US stimulus and debt limit edit, as well as the latest pact among the UK, Australia and the US.
China’s Evergrande isn’t only flashing red signals due to $300 billion debt but 1,300 projects in over 280 cities and multiple linkages abroad also make it the key challenge to the global economy when the pandemic is taking a toll of late. Although the Chinese policymakers are trying their hard to rescue the firm and shareholders, risks remain high.
Elsewhere, New Zealand reports new cases outside Auckland but Japan stays ready to end the virus-led emergency. Further, Australia's covid count also eases of late.
It’s worth noting that Friday’s preliminary readings of the US Michigan Consumer Sentiment Index for September eased below 72.20 forecast to 71.0 but stayed above 70.30 prior readouts. The same joins the previously released US Consumer Price Index (CPI) and the escalating Delta covid variant cases to challenge the Fed hawks. Even so, firmer Retail Sales and factory-gate inflation data join the hopes of further stimulus to challenge the easy-money supporters.
That said, Axios recently reported that US Senator Manchin delay President Joe Biden’s spending package vote to 2022. On the contrary, US House Speaker Pelosi said to expect a bipartisan approach to address the debt limit, per Reuters.
Given the lack of major data/events, as well as an off in Japan and China, global markets may offer a lackluster start to the key week.
Read: The week ahead: Fed meeting, Bank of England, Canada and Germany elections, Kingfisher, Nike, Fedex
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.