S&P 500 Futures rebound, yields grind near multi-day high on China, Fed concerns

  • Market sentiment improves during a sluggish session amid mixed headlines.
  • Upbeat comments from China President Xi, Finance Minister Liu Kun add to the risk-on mood.
  • Concerns surrounding US debt ceiling expiration probes US Dollar bulls.
  • Strong US data underpins upbeat Treasury bond yields and US Dollar, despite recent pullback.

Risk profile improves during early Thursday as headlines from China allow traders to pare the previous day’s losses amid a dicey session. Even so, the hawkish concerns surrounding the Federal Reserve (Fed), backed by the strong US data, keep the bears hopeful.

That said, the S&P 500 Futures print mild gains around 4,165 while extending the previous day’s gains, whereas the US 10-year Treasury bond yields retreat following the run-up to a 1.5-month high marked on Wednesday, down one basis point to near 3.80% by the press time.

Earlier in the day, China President Xi Jinping crossed wires while showing readiness to deepen industrial and investment cooperation with Asia. “Willing to share ultra-large-scale markets, complete industrial systems and advanced technologies with central Asian countries,” said China’s Xi.

Following him were upbeat comments from Chinese Finance Minister Liu Kun, who said that the 2023 fiscal revenue would grow this year, though the growth rate will not be too high, per the Chinese state media.

On the same line were fears of witnessing the US debt-ceiling crisis, as warned by the US Congressional Budget Office (CBO) on Wednesday per Reuters, which suggests a faster solution to the big problem in the upcoming days.

It’s worth noting that Wall Street managed to close with mild gains only because of the day-end corrective rebound, while the stocks in the Asia-Pacific region trade mixed by the press time, suggesting a cautious mood in the market.

On Wednesday, US Retail Sales growth jumped to 3.0% YoY in January versus 1.8% expected and -1.1% prior. Further, The Retail Sales ex-Autos grew by 2.3% in the same period, compared to analysts' estimate of +0.8%. On the same line, the NY Empire State Manufacturing Index for February improved to a three-month high of -5.8 versus -18.0 expected and -32.9 market forecasts. Alternatively, the US Industrial Production marked 0.0% MoM figures for January, compared to analysts’ estimate of 0.5% and -0.7% previous readings, but failed to push back the hawkish bias surrounding the Federal Reserve’s (Fed) next move.

Following the US data, the market’s bets on the Fed’s next moves, as per the FEDWATCH tool of Reuters, suggest the US central bank’s benchmark rate is to peak in July around 5.25% versus the December Federal Reserve prediction of 5.10% top rate.

Looking ahead, the second-tier US data concerning the housing market, industrial activity and producer prices may entertain traders.

Also read: Forex Today: US Dollar strength continues amid resilient American economy

Share: Feed news

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. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Recommended content

Recommended content

Editors’ Picks

EUR/USD fluctuates near 1.0850 as markets assess Fed commentary

EUR/USD fluctuates near 1.0850 as markets assess Fed commentary

EUR/USD trades in a tight range at around 1.0850 on Tuesday. In the absence of high-tier data releases, the cautious market mood helps the USD hold its ground and limits the pair's upside. Meanwhile, investors continue to scrutinize comments from central bank officials.


GBP/USD stays in positive territory above 1.2700, awaits fresh catalysts

GBP/USD stays in positive territory above 1.2700, awaits fresh catalysts

GBP/USD struggles to stretch higher above 1.2700 on Tuesday as the mixed action in Wall Street supports the USD. Investors await fresh catalysts, with several Fed officials and BoE Governor Bailey set to speak later in the session. 


Gold rebounds to $2,430 as US yields edge lower

Gold rebounds to $2,430 as US yields edge lower

Gold gained traction and climbed to $2,430 area in the American session, turning positive on the day. The pullback in the benchmark 10-year US Treasury bond yield helps XAU/USD stage a rebound following the sharp retreat seen from the all-time high set at the weekly opening at $2,450.

Gold News

Shiba Inu price flashes buy signal, 25% rally likely Premium

Shiba Inu price flashes buy signal, 25% rally likely

Shiba Inu price has flipped bullish to the tune of the crypto market and breached key hurdles, showing signs of a potential rally. Investors looking to accumulate SHIB have a good opportunity to do so before the meme coin shoots up.

Read more

Three fundamentals for the week: UK inflation, Fed minutes and Flash PMIs stand out Premium

Three fundamentals for the week: UK inflation, Fed minutes and Flash PMIs stand out

Sell in May and go away? That market adage seems outdated in the face of new highs for stocks and Gold. Optimism depends on the easing from central banks – and some clues are due this week.

Read more