Stock futures rise on China stimulus, trade optimism
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[January 02, 2020] By
Manas Mishra
(Reuters) - U.S. stock index futures rose
on the first trading day of the new decade on Thursday, as fresh
stimulus from Beijing to prop up its slowing economy added to the
optimism fueled by easing trade tensions and an improving global
outlook.
All three major U.S. stock indexes ended higher on Tuesday after
President Donald Trump said an initial U.S.-China trade pact would be
signed on Jan. 15.
Expectations of a trade deal, robust U.S. economic data and a loose
monetary policy by some of the world's most influential central banks
had powered a rally on Wall Street in December.
The benchmark S&P 500 index <.SPX> signed off on the last decade with
its strongest December since 2010, while the Nasdaq briefly traded above
the 9,000 mark.
China's central bank said on Wednesday it would cut the amount of cash
that all banks must hold as reserves, the eighth such cut since early
2018, injecting fresh stimulus into the economy. The decision also
lifted stock markets in Asia and Europe.
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Still, the mood among traders is turning cautious heading into a year marked by
impeachment proceedings against Trump and U.S. presidential elections later.
Investors are also closely tracking developments on Brexit, which is now set for
Jan. 31.
At 7:09 a.m. ET, Dow e-minis <1YMcv1> were up 156 points, or 0.55%. S&P 500
e-minis <EScv1> were up 16.75 points, or 0.52% and Nasdaq 100 e-minis <NQcv1>
were up 59.25 points, or 0.68%.
IHS Markit's final manufacturing Purchasing Managers' Index (PMI), set to be
released at 9:45 a.m. ET, is expected to show a reading of 49 last month, higher
than 48.1 in November. Readings below 50 denote contraction.
Among sparse individual movers premarket, Hanesbrands Inc <HBI.N> slipped 1.8%
after a report that Wells Fargo has downgraded the apparel maker's shares to
"underweight".
(Reporting by Manas Mishra in Bengaluru; Editing by Sriraj Kalluvila)
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