Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

U.S. Opening Bell: Futures, European Stocks Jump On U.S. Deal To Avoid Shutdown

By Investing.com (Pinchas Cohen/Investing.com)Market OverviewSep 30, 2021 11:57
uk.investing.com/analysis/opening-bell-futures-european-stocks-jump-on-us-deal-to-avoid-shutdown-200498112
U.S. Opening Bell: Futures, European Stocks Jump On U.S. Deal To Avoid Shutdown
By Investing.com (Pinchas Cohen/Investing.com)   |  Sep 30, 2021 11:57
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
  • Small-cap Russell 2000 outperforms
  • Mining stocks in Europe and Asia-Pacific lead on recovery hopes
  • Dollar eases

Key Events

US contracts on the Dow, S&P, NASDAQ and Russell 2000 and stocks in Europe rallied on Thursday following positive political news out of the US yesterday. A deal to avert a US government shutdown in October had been hammered out; as well, Federal Reserve Chair Jerome Powell reiterated his assertion that price pressures are temporary, even if the current spike in inflation is "frustrating."

The dollar softened but yields rebounded.

Global Financial Affairs

Yesterday, US Senate Majority Leader Chuck Schumer announced that lawmakers on both sides of the aisle managed to reach an agreement to keep the US government running. While the bill ignores the debt ceiling, investors breathed a sigh of relief.

Separately, yesterday ECB President Christine Lagarde reasserted her opinion that the current hike in inflation is merely transient and that once bottlenecks created by coronavirus shutdowns are cleared, prices will settle. This oft-repeated promise gave speculators with nerves the encouragement to buy the dip.

All four US futures were deep in the green this morning, with the Russell 2000 gaining the most, up 0.9%. Futures on the S&P 500 Index were up almost 0.5% after the underlying benchmark rebounded on Wednesday from a two-month low.

Investors found new hope in the economic recovery, enabling them to swallow the bitter pill of rising bond yields. Optimism in the continued expansion of the economy is what drove Russell 2000 contracts to outperform, as it lists smaller, domestic firms that are sensitive to the business cycle.

In Europe, the STOXX 600 Index pared a monthly decline, rising with miners that tracked iron ore prices higher.

In the Asian session, regional equities wiped out early losses as markets whipsawed due to signs of a continued slowdown in China. Factory activity there fell in September for the first time since the global pandemic began.

As often happens, stocks in Hong Kong paid the price, as it is the market which many foreign investors use to trade Chinese stocks. The financial hub’s Hang Seng dropped 0.36%, underperforming the region. Australia’s ASX 200 soared 1.9%, driven by the rising iron ore prices that lifted European stocks. With the help of rising bank stocks, the benchmark snapped a two-day rout.

Treasury yields on the 10-year note, which have been blamed for the recent sharp selloff, rebounded from a would-be second day low. Also, yields trimmed half of their Wednesday decline, demonstrating continued demand for Treasuries which is ominous for equities.

10-year Treasuries Daily
10-year Treasuries Daily

Having completed an ascending triangle, prices are likely to fluctuate.

The dollar eased after a three-day run that took it to its highest level since November.

Dollar Index Daily
Dollar Index Daily

The recent rally blew out a H&S top and completed a huge double-bottom.

Gold has been pressured by the USD’s advance, but not proportionately. The recent selloff in stocks had investors hiding their money in safe havens.

Gold Daily
Gold Daily

Although the precious metal is pressured now by a Death Cross—the price fell below the June 29 low, the possible left shoulder of a H&S bottom—it’s still in play.

Bitcoin jumped after SEC Chief Gary Gensler repeated his support for Bitcoin futures ETFs. However, from a technical perspective, this could be a dream short.

Bitcoin Daily
Bitcoin Daily

The cryptocurrency is testing both a bearish pennant and the neckline of a H&S bottom. From aggressive traders’ point of view this provides an ideal short entry from a risk-reward perspective.

Oil came back from a second daily decline, heading for a monthly advance thanks to tighter supplies. Yet, even with higher prices WTI, US shale producers aren't stepping up production.

Oil Daily
Oil Daily

Technically, crude must still contend with the likely resistance of the July 6 peak.

Up Ahead

Market Moves

Stocks

  • The FTSE 100 increased 0.2%
  • The STOXX 600 rose 0.9%
  • Futures on the S&P 500 rose 0.8%
  • Futures on the NASDAQ 100 rose 0.9%
  • Futures on the Dow Jones Industrial Average rose 0.8%
  • The MSCI Asia Pacific was little changed
  • The MSCI Emerging Markets was little changed

Currencies

  • The British pound was little changed at $1.3437
  • The Dollar Index fell 0.2%
  • The euro was little changed at $1.1607
  • The Japanese yen was little changed at 111.93 per dollar
  • The offshore yuan rose 0.1% to 6.4686 per dollar

Bonds

  • Britain’s 10-yearyield advanced two basis points to 1.01%
  • The yield on 10-year Treasuries advanced two basis points to 1.53%
  • Germany’s 10-year yield advanced one basis point to -0.20%

Commodities

U.S. Opening Bell: Futures, European Stocks Jump On U.S. Deal To Avoid Shutdown
 

Related Articles

U.S. Opening Bell: Futures, European Stocks Jump On U.S. Deal To Avoid Shutdown

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email