Futures Rise on Chinese Strength, Stimulus Hopes
U.S. equity futures rose slightly in early Monday trade following news out of China that Chinese authorities will now allow direct investment of foreigners in stocks, bonds, and other financial assets. The news is just another step in China’s transformation into a more open economy. Also, comments from Chicago Fed President Charles Evans signaled that the latest round of QE is not ending anytime soon, especially with the latest FOMC members seeming more dovish than last year’s members.
Top News
In other news around the markets:
Asian Markets
Asian shares were higher overnight following both the news out of China and the news out of Japan, as well as relaxed fears on the global economy. The Japanese Nikkei Index rose 1.4 percent and the Shanghai Composite Index rose 3.06 percent while the Hang Seng Index rose 0.64 percent in Hong Kong trading. In addition, the Korean Kospi rose 0.52 percent and Australian shares rose 0.22 percent.
European Markets
European shares were higher in early Monday trade led by Italian stocks despite the weaker than expected industrial production data. The Spanish Ibex Index rose 0.55 percent and the Italian MIB Index rose 1.00 percent, despite bond yields rising. Meanwhile, the German DAX rose 0.77 percent and the French CAC rose 0.6 percent while U.K. shares rose 0.13 percent.
Commodities
Commodities were higher overnight in clear risk-on markets. WTI Crude futures rose 0.64 percent to $94.16 per barrel and Brent Crude futures rose 0.56 percent to $111.20 per barrel. Copper futures rose 0.71 percent to $368.05 per pound on the news out of China. Gold was higher and silver futures rose 0.35 percent to $30.76 per ounce.
Currencies
Currency markets were in clear risk-on mode as the euro continued to rally and the yen continued to be weak. The EUR/USD was higher at 1.3376 and the dollar rose against the yen to 89.31. Overall, the Dollar Index fell 0.14 percent on weakness against the euro, the Canadian dollar, and the Swedish krone, despite being stronger against the yen, the pound, and the Swiss franc.
Pre-Market Movers
Stocks moving in the pre-market included:
Earnings
Notable companies expected to report earnings Monday include:
Economics
On the economics calendar Monday, there are no important data releases on the economic calendar. However, the Fed’s John Williams, Dennis Lockhart, and Ben Bernanke are set to speak.
Good luck and good trading.
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Tags: Bank of Japan, Ben Bernanke, Charles Evans, China, Dennis Lockhart, Fiscal Cliff, FOMC, industrial production, Japanese Prime Minister Shinzo Abe, John Williams, Larry Summers, Quantitative Easing
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