Stocks Set To Open Higher Despite Stimulus Uncertainty

Stimulus Drama Continues

S&P 500 futures are gaining some ground in premarket trading while traders prepare for a shortened session ahead of Christmas.

Typically, it is a very calm trading session with a low trading volume. However, traders have several important stories to follow today so trading activity may be stronger than usual.

Yesterday, U.S. President Donald Trump vetoed the defense policy bill and reiterated his call to increase the amount in stimulus checks from $600 to $2,000 per person.

His proposal was cheered by Democrats who want to vote on it as soon as possible. It remains to be seen whether Trump’s fellow Republicans will agree to increase the size of the package.

In addition, it is not clear whether any consensus could be reached before the end of the shortened trading session so market participants may have to wait until Monday to react on the new developments.

EU and UK Are Very Close To The Brexit Deal

According to recent reports, UK and EU have made big progress in negotiations and have a chance to sign the Brexit trade deal today.

Fisheries are the only remaining obstacle, and negotiators need a few more hours to negotiate the details of the future fishing regime in British waters.

The market believes that the deal is imminent, and GBP/USD is trading near yearly highs. At the same time, it remains to be seen whether news about a deal will be able to provide additional support to riskier assets.

U.S. Dollar Remains Stuck Near Yearly Lows

While today’s trading action will likely remain calm on the foreign exchange market, the next week may bring more volatility for the American currency as traders will react to Brexit and stimulus news.

The U.S. Dollar Index has settled just above the major support level at 90 after an unsuccessful attempt to get above the resistance at 91 which was made several trading sessions ago.

If the U.S. Dollar Index gets to the test of the yearly lows at 89.73, commodities and commodity-related stocks may get a boost.

For a look at all of today’s economic events, check out our economic calendar.