U.S. Stocks Mixed As Traders Prepare For A Wave Of Earnings ReportsS&P 500 futures are swinging between gains and losses in premarket trading amid stimulus uncertainty.
U.S. Senate Is Set To Vote On A $500 Billion Aid Package Next Week
Senate Majority Leader Mitch McConnell stated that the Senate would vote on a new $500 billion coronavirus aid package early next week.
This is another attempt from Republicans to push a smaller aid bill ahead of November election. At this point, there are no signs that Democrats’ position has changed – they want to implement a comprehensive bill worth $2.2 trillion.
The recent market rally was based on belief that another big stimulus package is inevitable. However, it is not clear whether the economy will get any help before November.
The third-quarter earnings season has already started so traders will have plenty of information to digest in the upcoming weeks. However, the market will still keep a close eye on any developments on the stimulus front.
At this point, stocks clearly need additional catalysts to move higher, and S&P 500 futures are mostly unchanged in premarket trading.
Brexit Comes Back Into Spotlight
The U.S. stock market has completely ignored Brexit news for some time. However, Brexit is set to come back into spotlight as EU leaders will meet in Brussels tomorrow to discuss the deal with Britain.
According to recent reports, EU believes that the progress in talks with Britain is not sufficient enough to get a deal.
A no-deal Brexit will likely send shockwaves across financial markets. At this point, volatility is mostly limited to GBP/USD but the situation may change quickly in case EU and Britain fail to negotiate a Brexit deal.
Producer Prices Increased By 0.4% In September
U.S. has just reported Producer Prices data for September. On a month-over-month basis, Producer Prices increased by 0.4% while analysts called for growth of just 0.2%.
Core Producer Prices also gained 0.4% month-over-month. On a year-over-year basis, Core Producer Prices increased by 1.2% compared to analyst consensus of 0.9%.
Yesterday’s inflation numbers were a bit weaker than expectations, and it is interesting to see that Producer Prices are showing some strength.
For a look at all of today’s economic events, check out our economic calendar.