Friday June 9th

9-06-2017

Stocks poised to rise, shaking off UK election shocker, Comey testimony aftermath

U.S. stock index futures pointed to a higher open on Friday, following results of the U.K. election, with Theresa May's Conservative party losing its outright majority in parliament. E-mini futures for the Dow, Nasdaq and S&P 500 all pointed higher at 7:25 a.m. ET, after news emerged that the U.K.'s snap election had ended in a hung parliament. With U.K. Prime Minister Theresa May having called for an election earlier this year, her party, the Conservatives, had expected to strengthen their hand in the June 8 election, but have ended up losing a number of seats in parliament, meaning the election has shown no clear majority. Since no party secured an outright majority, Britain is facing a hung parliament. That means multiple parties have to work together to hammer out a coalition government. This can also delay, or hurt, upcoming Brexit negotiations, as well as affect May's political future. Those results sank the pound to a Friday session low of $1.2632. At 7:26 a.m. New York time, sterling traded at $1.2766, down 1.43 percent against the greenback. In markets, European bourses including the U.K.'s FTSE 100 were posting solid gains, however, the pan-European STOXX 600 was under slight pressure along with many sectors. In Asia, trade finished mostly higher as investors paid close attention to the election result. Japan's Nikkei 225 rose 0.52 percent or 104 points to finish the session at 20,013.26 and the Kospi gained 0.77 percent or 18.12 points to close at 2,381.69. Australia's benchmark S&P/ASX 200 index was marginally higher, closing 0.02 percent or 1.203 points up at 5,677.8. The Hang Seng Index was reversed earlier gains to edged lower by 0.35 percent while markets on mainland China closed in the money. The Shanghai Composite closed up by 0.27 percent or 8.4125 at 3,158.7461 and the Shenzhen Composite added 0.233 percent or 4.3083 to finish at 1,857.1653.While British politics is set to dominate on Friday, investors will also be paying close attention to news out of the White House as well as keeping an eye on moves in the energy space. On Thursday, U.S. markets closed mostly higher as Wall Street digested the former FBI Director James Comey's testimony. Investors had been paying close attention to the testimony, to see if Comey's remarks would be damaging for U.S. President Donald Trump.In his testimony, Comey said he kept records of his conversations with Trump — something he did not do when Barack Obama was president — because he thought Trump might "lie." In commodities, oil futures edged higher in morning trade, yet concerns of a possible glut in the market weighed on sentiment. At 7:27 a.m. ET, U.S. crude and Brent were trading higher, reaching at $45.71 and $47.88, respectively. In data news, wholesale trade is slated to come out at 10 a.m. ET. Gold fell for a third day on Friday after British elections failed to deliver a clear majority for Prime Minister Theresa May, knocking the pound sharply lower and helping lift the dollar index to its highest since late May. Spot gold was down 0.3 percent at $1,274.41 an ounce at 0930 GMT, while U.S. gold futures for August delivery were $2.80 an ounce lower at $1,276.70.