S&P 500 Futures stay on the back foot for third consecutive day as covid, US politics weigh on risks

S&P 500 Futures print mild losses near the lowest since January 06.
Doubts over Biden’s initial actions, Yellen’s approach to USD trouble traders amid a quiet session.
Virus woes remain present despite recently easing covid data.
China data dump and risk headlines can entertain traders amid US off.

Anil Panchal FXStreet

S&P 500 Futures drop to $3,749, down 0.35% intraday, during early Monday. In doing so, the risk barometer stays heavy near more than a week’s low while flashing a three-day downtrend.

Although a lack of major data/events and a long weekend in the US currently keep the Asian markets quiet, cautious sentiment ahead of US President-elect Joe Biden’s office term keeps the risks heavy. Although Mr. Biden has already rolled out a heavy coronavirus (COVID-19) stimulus package of $1.9 trillion, chatters surrounding the cancelation of the Keystone XL pipeline permit via executive action on his first day in office probe the risk-takers.

Read: New UK covid stats lower despite variant, vaccine rolled out

Further, Wall Street Journal came out with the news suggesting Janet Yellen, incoming Treasury Secretary of the US, to affirm a commitment to market-determined dollar value as well as her likely status as the only official to talk on the USD exerted additional downside pressure on the risks. It should be noted that the Fed’s back-up to the US stimulus and the UK’s extra activity restrictions due to the virus spread are additional negatives that weigh on the mood.

On the positive side, market sentiment benefits from the news suggesting the latest covid numbers from the UK have been down off-late while vaccine producers claim to have the ability to tame the virus variants.

Amid these plays, stocks in Japan, Australia and China have been downbeat while the US dollar index (DXY) rises to a fresh high since December 21, 2021.

Moving on, China’s fourth-quarter (Q4) GDP and December’s Retail Sales, as well as Industrial Production, can entertain short-term traders amid a likely dull session due to Martin Luther King’s Birthday in the US.

Read: Chinese Q4 GDP Preview: Economic growth back to pre-pandemic levels?

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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