US Pre Market Open: Trade hopes and dovish Fed serve buoy futures.

Market Analysis /
08 Jan 2019

Mounting expectation that he Federal Reserve may not be in a position to hike interest rates at all during 2019 owing to the deteriorating global economic outlook has lent fresh support to US index futures overnight. There’s also optimism over progress being seen in the US-China trade talks which are ongoing in Beijing right now, with the involvement of President Xi’s most senior aide helping lend a degree of support, too. That said, the US arguably remains on the back foot here with stock market volatility and domestic political issues having the potential to give China the upper hand. Any resolution would have the ability to bolster US equities, but the accompanying concessions need to be closely monitored.

Economic data is thin on the ground for the day ahead, although US consumer borrowing numbers due shortly before the market close could prove telling. The increasingly dovish tone from the Fed supports the idea that a notable decrease will be seen here, although anything coming in much below the predicted $16billion could heighten concerns that the US is about to tip into recession sooner than some may hope.

Ahead of the open we’re calling the DOW up 149 at 23680 and the S&P up 15 a 2565.

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