Futures jump on growing stimulus hopes
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[August 19, 2019] By
(Reuters) - U.S. stock index futures rose
about 1% on Monday as signs of an interest rate reform in China
bolstered hopes that major economies would act to stave off the slowing
economic effects of escalating global trade tensions.
The latest stimulus for the world's second-largest economy follows news
of potential German economic easing on Friday, which helped Wall
Street's major indexes end the session more than 1% higher.
The indexes racked up their third straight weekly loss on Friday and the
S&P 500 <.SPX> is now about 5% away from a record high hit in July.
However, traders will be split on direction for the next few weeks as
they balance trade risks and signs of slowing growth with the potential
for more action from the U.S. Federal Reserve and others in September.
The week's big centerpieces are Wednesday's release of minutes from the
Fed's July policy meeting, when the central bank cut rates for the first
time in more than a decade and Chair Jerome Powell's speech at a central
banks meeting in Jackson Hole on Friday.
With a bond market rally easing, interest-rate sensitive lenders rose in
premarket trading. Bank of America Corp <BAC.N>, Citigroup Inc <C.N>,
JPMorgan Chase & Co <JPM.N>, Goldman Sachs <GS.N>, Wells Fargo & Co <WFC.N>
and Morgan Stanley <MS.N> were all up between 1.5% and 2%.
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Traders work on the floor at the New York Stock Exchange (NYSE) in
New York, U.S., August 12, 2019. REUTERS/Eduardo Munoz
Chipmakers, which depend on China for a large portion of their revenue, also
gained. Intel Corp <INTC.O>, Advanced Micro Devices Inc <AMD.O>, Qualcomm Inc <QCOM.O>,
Micron Technology Inc <MU.O>, Nvidia Corp <NVDA.O> were all up between 1% and
At 7:02 a.m. ET, Dow e-minis <1YMcv1> were up 256 points, or 0.99%. S&P 500
e-minis <EScv1> were up 28 points, or 0.97% and Nasdaq 100 e-minis <NQcv1> were
up 87 points, or 1.14%.
The so-called FAANG group - Facebook Inc <FB.O>, Amazon.com Inc <AMZN.O>, Apple
<AAPL.O>, Netflix Inc <NFLX.O> and Google-parent Alphabet Inc <GOOGL.O> - were
up between 1% and 1.6%, with the iPhone maker leading the gains.
President Donald Trump said on Sunday that he had spoken with Apple Chief
Executive Tim Cook about the impact of U.S. tariffs.
(Reporting by Medha Singh in Bengaluru; Editing by Saumyadeb Chakrabarty)
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