Monday September 9th

9-09-2019

Stock futures point to a higher open amid more US-China trade optimism

U.S. stock index futures were set to open slightly higher Monday amid increasing optimism around U.S.-China trade relations. At around 6:55 a.m. ET, Dow Jones Industrial Average futures rose 56 points, indicating a gain of 63 points at the open. S&P 500 and Nasdaq 100 futures also pointed pointed to a higher open. The S&P 500 was also about 1.6% from its record high set in late July. The Dow and Nasdaq Composite entered the session more than 2% from their all-time highs. Bank shares rose in the premarket. Wells Fargo and J.P. Morgan Chase climbed 0.4% and 0.6%, respectively. Citigroup advanced 0.6% while Bank of America gained 0.7%. The gains in bank stocks come as Treasury yield traded higher. The benchmark 10-year rate traded at 1.59% while the 2-year yield rose to 1.57%. China offered last week to increase purchases of U.S. agricultural products if the U.S. eased restrictions on telecom giant Huawei, Politico reported on Friday. China’s offer could also be contingent on the U.S. delaying higher tariffs on about $250 billion worth of Chinese imports, the report said. Both countries have been engaged in a trade war since 2018. In that time, China and the U.S. have exchanged tariffs on billions of dollars worth of goods. The conflict has dampened expectations of global economic growth. New data out of China showed that exports unexpectedly fell in August with a large contraction for shipments to the United States. The drop indicates further weakness in the world’s second largest economy and puts further pressure on Chinese lawmakers to announce new economic stimulus. On the data front, there will be new consumer credit figures out at 3 p.m. ET. Asia markets rose on Monday as investors reacted to a series of recent data releases in major economies including the United States and China. Mainland Chinese stocks were higher on the day, with the Shanghai composite adding 0.84% to about 3,024.74 and Shenzhen component up 1.82% to 10,001.93. The Shenzhen composite also surged 1.913% to approximately 1,689.21. Hong Kong’s Hang Seng index, was largely flat as of its final hour of trading, following another weekend of protests in the embattled city. In Japan, the Nikkei 225 rose 0.56% to close at 21,318.42 while the Topix index added 0.91% on the day to 1,551.11. In South Korea, the Kospi added 0.52% to finish its trading day at 2,019.55. Oil rose on Monday on expectations that Saudi Arabia, the world’s largest oil exporter, will continue to support output cuts by OPEC and other producers to prop up prices under new Energy Minister Prince Abdulaziz bin Salman. Prices climbed for a fourth day and were also supported by comments from the United Arab Emirates’ energy minister that OPEC and its allies are committed to balancing the crude market. Global benchmark Brent was up 61 cents, or 1%, at $62.15 a barrel by 0649 GMT, while U.S. West Texas Intermediate was up 65 cents, or 1.2%, at $57.17 a barrel. Gold edged higher on Monday, crawling away from a two-week low touched in the previous session, supported by hopes of monetary policy easing by major central banks although the metal’s advance was capped by improved appetite for riskier assets. Spot gold was up 0.2% at $1,509.01 per ounce. The metal touched $1,502.50 on Friday, a level last seen on Aug. 23. U.S. gold futures were up 0.1% at $1,517.40 an ounce.