US futures hit fresh record highs amid surging risk sentiment because the markets reopen after President Day.
US futures hit fresh record highs amid surging risk sentiment because the markets reopen after President’s Day. Cyclical stocks like banks and therefore the energy sector are set for strong gains amid growing hope of a robust vaccine led economic recovery & more US fiscal stimulus. Metals extend gains on super cycle talk and Bitcoin hits $50,000.
Dow futures trade +0.6% at 31450
S&P futures +0.5% at 3918
Nasdaq futures +0.3% at 13715
FTSE flat at 6756
Dax +0.05% at 14114
Euro Stoxx +0.05% at 3736
After a sluggish start the US covid vaccine programme has ramped up with 52.9 million vaccines administered thus far . Expectations are growing of a robust vaccine led global economic recovery.
Meanwhile Biden’s $1.9 trillion stimulus package continues to form its way through Congress adding to the upbeat mood.
Metal prices are driving higher on expectations of buoyant global demand and a slow supply side response. Platinum trades at a fresh 7 year high whilst copper futures also are trading at their highest level since 2012.
Surging commodity prices have recently boosted speculation of a replacement commodities super cycle. Dividend announcements from BHP & Glencore further supported speculation.
Under priced value stocks are focused as investors rotate out of growth stocks into those stocks more closely associated to the performance of the economy. Oil stocks
Earnings from CVS, Zoetis and Ecolab are going to be focused . Results from Occidental Petroleum have rescheduled their income statement due to the weather disruptions.
According to Goldman Sachs earnings per share for SP500 companies have actually risen in Q4. It’s an increase of just 2% yoy, but still an increase and every one the more impressive as long as expectations were for an 11% decline heading towards earnings season.Bitcoin struck a fresh all time high cracking through $50,000 amid growing interest from major financial firms including BNY Mellon and Mastercard, adding to the asset’s legitimacy. Speculation is additionally growing that asset managers will increasing allocate a minimum of a fraction of their assets under management to cryptocurrencies.
Eurozone Q4 GDP fell but initially estimated contracting -0.6% QoQ vs -0.7% initially estimated. YoY GDP -5%, a small improvement on -5.1% fall from the preliminary reading.
Employment also rose by 0.3% in Q4, after a tenth QoQ rise in Q3. However, employment remains 2% less than an equivalent period a year earlier.
German investor morale unexpectedly surged in February to 71.2, up from 61.8 in January indicating a robust level of confidence that the German economy are going to be back on the expansion track quickly.
Strong data propelled EUR/USD over 1.2150.Demand for the shelter US Dollar remains weak on Tuesday with the US Dollar Index (DXY) falling to a 3 week low. Meanwhile demand for riskier currencies rises amid rising optimism over a vaccine le global economic recovery.
GBP/USD trades +0.15% at 1.3925
EUR/USD trades +0.3% at 1.2165
Oil bulls are pausing for breath after hitting $60.85 within the previous session A level last seen pre-pandemic. Growing optimism surrounding a vaccine led global economic recovery is boosting the demand outlook. Meanwhile rising tensions within the Middle East and a chilly front shutting some refineries in Texas are underpinning the worth .
US crude trades +0.3% at $59.84
Brent trades -0.06% at $63.24
Market analyst Fiona Cincotta looks at the worth action in WTI petroleum here.