S&P 500; US Indexes Fundamental Daily Forecast – Investors Seem Unfazed by London Attack, North Korean Missile and Quadruple Witch

The major U.S. stock indices are expected to open mixed on Friday amid concerns over geopolitical events and while investors prepare for the release of a slew of U.S. economic data.

At 1245 GMT, December E-mini Dow Jones Industrial Average futures are trading 22169, down 3 or -0.01%. December E-mini S&P 500 Index futures are at 2492.25, down 2.00 or -0.08% and the December E-mini NASDAQ-100 Index futures contract is trading 5966.00, down 4.75 or -0.08%.

Investors could be facing volatility late in the session because this is a Quadruple Witching Day. The Quadruple Witching Hour is the last hour of the session where stock index futures, stock index options, stock options and single-stock futures expire simultaneously.

I am saying “could be facing volatility” because the VIX is so low, there may not be any reaction to the expirations.

Early in the session, traders reacted to North Korea’s firing of a missile over Japan. Investors had the same knee-jerk reaction we’ve seen for months, they sold risky assets and bought safe haven assets. However, this move didn’t last very long and the markets recovered most of their earlier losses. Traders should continue to monitor this event.

In London, a homemade bomb exploded at a packed London subway station during Friday morning rush hour, injuring at least 22 people. Police called it a “terrorist incident.”

In other news, U.S. Retail Sales fell 0.2 percent in August. Economists were looking for a gain of 0.1 percent.

The Empire State Manufacturing Index hit 24.4, a higher-than-expected read.

Industrial Production came in lower-than-expected at -0.9%, down from a revised +0.4%. Traders were looking for +0.1%. Capacity Utilization came in slightly below expectations at 76.1%. However, the previous report was revised higher to 76.9%.

We could be looking a mixed bag today. I don’t think investors are paying too much attention to the Quadruple Witch, but they may be on edge throughout the session due to the attack in London.

We could be looking at a strong rally if investors decide to ignore the Quadruple Witch, the London attack and the North Korean incident. This will tell me that investors aren’t worried about anything even with stocks near all-time highs.