After the best week for the S&P 500 since 2011, US equity futures are opening up notably (Dow +400) after the so-called ‘trade-truce’. WTI is also soaring but yuan is fading off pre-open highs…
Including Friday’s meltup FOMO, stocks are up 2.5-3%…
Notably, yuan is fading as futures open…
In line with one “base case” which correctly predicted that a Truce – in which existing tariffs stay in place – is the most likely outcome (with a 70% chance), while also accurately predicting a 3 month ceasefire, the agreement will be enough to get the S&P to 2,800…
… so look for a burst of buying in the S&P over the next 24 hours which pushes the stock index higher, but not much higher as trader concerns will next revert back to the Fed which now that trade tensions have been temporarily removed, may promptly revert back to its hawkish bias and resume rising rates well into 2019 which in turn will be the next bearish event-risk to put a damper on any substantial Christmas rally.
And that is exactly where S&P Futs are – 2800…
Meanwhile, WTI Crude futures are soaring 2.5% despite Putin’s confirmation that there will be no new oil production cuts…
Gold spiked but immediately faded back.
via RSS https://ift.tt/2RshCUH Tyler Durden