S&P 500 Futures regain 3,700 amid fresh vaccine hopes

S&P 500 Futures consolidate the previous day’s loses.
US FDA unveils news of 95% effectiveness of two new covid vaccines.
Fears of covid strain, fresh lockdown announcements previously weighed on risks.
Increasing odds for Democratic party’s victory in the Georgia runoff favor the risks as well.

Anil Panchal FXStreet

S&P 500 Futures licks the previous day’s wounds to regain 3,700, currently up 0.30% near 3,702, amid Tuesday’s Asian session. The risk barometer marked the heaviest losses in almost two months the previous day as the spread of the coronavirus (COVID-19) variants triggered lockdowns in multiple countries. However, the recent news of vaccines from the US Food and Drug Administration (FDA) joins the hope of stimulus to portray the shift in mood.

The FDA conveys 95% effectiveness of two leading covid-19 vaccines, namely Pfizer-BioNTech and Moderna, in preventing covid-19 infection in adults." The news gains a good response from optimists waiting for a cure to the pandemic that recently marked stronger and more reliant strains.

Also favoring the recovery mood could be the recent chatters that Democrats may have an upper hand in Georgia’s election runoff. Goldman Sachs said, “There are encouraging signs for Democrats in the Senate runoff. Prediction markets appear to take the same view and imply nearly even odds that Democrats win both seats, up from around 20% shortly after the November election.”

Read: Georgia Elections Preview: Markets geared for a special moment, three scenarios

Even so, fears of a wider outbreak of the virus strain, the one with clues from South Africa, keeps the risk-on mood challenged amid a light calendar.

That said, stocks in Asia-Pacific trade mixed while the US 10-year Treasury yields print mild gains around 0.92% by press time.

Moving on, risk catalysts remain as the key driver, with virus update and US election news being even more important, ahead of the North American session. During the US trading, ISM Manufacturing PMI will also be important to watch.

Read: US Manufacturing PMI December Preview: COVID is the present but recovery is the future

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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