US index futures may be poised to start the day with some modest gains, but upside is being kept firmly in check by the fact that there was no progress regarding Sino-US trade ties at the weekend’s APEC summit. This is pushing expectations towards an announcement being seen as part of the G20 meeting at the end of the month, but time is pressing here as a slowing Chinese economy and weakening currency is risking a series of corporate defaults for some of those companies servicing US dollar denominated debt. Again, any flight for quality in the bond market would have the residual effect of pushing US treasury yields higher and again giving cause to sell down stocks.
Economic and corporate data is relatively thin on the ground for the day ahead, with a US housing reading shortly after the opening bell being the only real stand out. Volumes should be expected to tail off as the week progresses, with the Thanksgiving break looming so again this may serve to exacerbate volatility in the near term.
Ahead of the open we’re calling the DOW up 22 a 25,435 and the S&P up 3 at 2739.
Yields are up, but it was a tale of two divergent tapes in US equity markets; Oil heads lower as dollar strengthens; Gold takes the express elevator down