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The final week of 2018 has seen wild swings in equities. The
benchmark S&P 500 tested its 20-month low and was at the brink
of a bear market territory early in the week before the three
main indexes roared back, with their biggest daily surge in
nearly a decade on Wednesday and a late rally the following day.
On Thursday, the S&P fell as much as 2.8 percent but closed 0.8
percent higher as the markets turned around late in the session.
The CBOE Volatility Index <.VIX>, an indicator of short-term
volatility in the stock market, rose to 36 midweek, its highest
level since early February. It has since pulled back below 30,
but remains well above a recent low of 15 at the beginning of
December.
In a sign of optimism on trade on Friday, China opened the door
to imports of rice from the United States for the first time
ever in the run-up to talks between the two countries in
January.
"With two trading sessions left before year end, the indices are
likely to be supported by window dressing and technical
factors," said Peter Cardillo, chief market economist at Spartan
Capital Securities in New York.
Cardillo expects another round of positive trading, which he
says will be supported in part by the news that China is
allowing U.S. rice imports ahead of the trade talks.
At 6:39 a.m. ET, S&P 500 e-minis <ESc1> were up 0.95 percent.
Dow e-minis <1YMc1> were up 0.92 percent and Nasdaq 100 e-minis
<NQc1> were up or 0.81 percent.
Despite two days of gains, all three major indexes are still
down more than 9 percent for December and remain on track for
their biggest annual percentage drop since 2008.
Investors head into 2019 with a list of worries ranging from
U.S.-China trade tensions, rising interest rates and a cooling
economy to a partial U.S. government shutdown, which is now in
its sixth day.
On the economic calendar, data from National Association of
Realtors will likely show pending home sales edged higher to
560,000 million in November from 544,000 million the month
before. The data is expected at 10:00 a.m. ET.
(Reporting by Medha Singh in Bengaluru; Editing by Anil D'Silva)
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