Wall Street found some cheer in the latter part of yesterday’s session amidst speculation that US-imposed import tariffs could soon be relaxed. This is seen as a possible route to accelerating a resolution to the trade deadlock that is currently seen as weighing on equities and with the clock ticking down to the March 1st deadline, such an incentive would be well received by the market. Asian stocks have cheered the news too, but there are already signs of push back from some divisions in Washington. As a result, market sentiment could well be cautious going into the weekend break although for now index futures do suggest a positive start is on the table.
Earnings season continues although as is typical for the end of the week, the higher profile names are absent. However, the University of Michigan sentiment reading is due to be tabled shortly after the opening bell and the impact of the government shut down may well filter through here. A notable reduction is already expected, but anything much below the forecast 96.8 could certainly raise eyebrows. Whether it would prove overtly negative for stocks remains to be seen, as the dominant factor could be calls for a more dovish stance to be adopted by the Fed.
Ahead of the open we’re calling the DOW up 60 a 24430 and the S&P up 5 at 2641.
Sometimes you have to throw conventional wisdom out the door and just let the good times roll