S&P 500 Futures: Mildly offered amid pre-FOMC minutes caution

S&P 500 Futures struggle for clear direction, down 0.20% around 4,120, during early Wednesday. The risk barometer benefited from the vaccine and stimulus hopes the previous day before pre-event caution weighed on the mood. Also testing the market optimism could be a lack of major catalysts in Asia and mixed signals concerning the coronavirus (COVID-19).

US readiness to share covid vaccine with needy nations and China’s push for patent waiver joins lead drugmakers’ signals to have found the cure for Indian variant of the virus to favor the risk-on mood the previous day. However, doubts concerning the Fed’s next move, amid downbeat Housing data and further stimulus in the pipeline, dragged Wall Street benchmarks on Tuesday.

Read: Wall Street Close: Another day in the red with eyes on FOMC minutes

The moves got fewer positives in Asia as Europe weighs plans over China investments and the UK signs a trade deal with Australia. It should be noted that the COVID-19 strain from India pushes back the British deadline for unlocking while Japan doubts removing the emergency in May, which in turn exerts additional downside pressure on the mood.

Elsewhere, off in Hong Kong and Taiwan and a lack of major data limits the market’s moves and hence US dollar index (DXY) portrays a corrective pullback from late February lows, tested on Tuesday. It should be noted that the US 10-year Treasury yield defends 1.64% despite the recent failures to cross the 1.65% level.

Moving on, FOMC minutes will be closely observed to confirm the policymakers’ bearish bias. In absence of which, the US dollar could witness the much-awaited bounce and equities can drop afterward.