S&P 500 Futures consolidate losses, US Treasury yields struggle amid mixed sentiment

S&P 500 Futures part ways from Wall Street performance.
US Treasury yields seesaw near recent lows.
Mixed signals concerning the Fed rates, downbeat economic outlook also weigh on the market’s risk-tone sentiment.
Trade/virus fears add upside barriers on the pullback.

Anil Panchal FXStreet

While snapping two-day losing streak, S&P 500 Futures register 0.40% gains to 2,825 amid the early Asian session on Thursday. On the contrary, US 10-year and 2-year Treasury yields take rounds to 0.65% and 0.17% after flashing losses during the previous day.

The recent shift in the market sentiment could be attributed to the comments from US President Donald Trump and Treasury Secretary Steve Mnuchin. While the Republican leader disagreed with the Fed Chair Jerome Powell over negative rates, Treasury Secretary Mnuchin showed readiness to spend more money to aid the economy.

On Wednesday, the Fed Chair ruled out the recent concerns over the Fed’s negative rates in 2021 while portraying a downbeat economic scenario. Also joining the league to defend the Fed was Cleveland Federal Reserve President Loretta Mester.

It’s worth mentioning that the US-China tussle is getting hot with US President Donald Trump stopping investments into the Chinese stocks.

It should also be noted that the US and China are at loggerheads over the Phase 2 of the trade deal with the former ruling out the scope of renegotiation of Phase 1 terms.

Additionally, fears are also mounting that US President Trump might not hesitate to levy sanctions on China if the US Senate passes a bill that enables the Republican leader to do so if the dragon nation fails to cooperate on virus investigation.

Elsewhere, the rise in the virus figures from the economies that have recently eased the coronavirus (COVID-19)-led lockdowns questions the market’s optimism surrounding the economic restart.

Looking forward, today’s US Jobless Claims could offer additional direction to the markets amid the broad risk aversion wave that takes clues from the trade and virus updates.

Author

Anil Panchal

FXStreet

Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.

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