The Tuesday Market Minute
- Global stocks mixed heading into Tuesday's opening bell, and this evening's Presidential debate in Cleveland, Ohio.
- President Donald Trump and challenger Joe Biden will face-off in the first of two debates later tonight at Case Western Reserve University.
- House Speaker Nancy Pelosi unveils a $2.2 trillion stimulus bill, but remains far apart from her Republican rivals in terms of getting full Congressional support.
- Global coronavirus fatalities top the 1 million mark, with infections passing 33.4 million, as the pandemic's autumn resurgence continues to worry health officials.
- German 10-year bund yields hit a seven-week low amid cautious overnight trading, while the dollar continues to slip from last week's two-month high.
- Oil prices retreat amid renewed concerns for global demand as stimulus talks aren't expected to advance as Congress remains divided.
- U.S. equity futures suggest a softer open on Wall Street ahead of house price data at 9:00 am Eastern time and consumer confidence data at 10:00 am Eastern time.
U.S. equity futures edged modestly lower Tuesday as investors peeled away from yesterday's triple-digit rally on Wall Street to adopt a more cautious stance heading into tonight's Presidential debate between incumbent Donald Trump and challenger Joe Biden.
The pair will trade questions and answers with moderator Chris Wallace over a 90-minute televised debate scheduled for 9:00 pm Eastern time, with the President's tax returns, his economic record and his handling of the country's coronavirus pandemic likely to take center-stage at Case Western Reserve University in Cleveland, Ohio.
Prospects of a House vote on a newly-crafted $2.2 trillion stimulus package, unveiled last night by Speaker Nancy Pelosi, which she said includes "new funding needed to avert catastrophe for schools, small businesses, restaurants, performance spaces, airline workers and others", are providing some bullish sentiment in global markets, but the overall tenor remains uncertain heading into the start of the trading session.
Part of that uncertainty continues to be linked to the rising level of both coronavirus infections and fatalities in major economies -- as well as smaller ones -- around the world, with data indicating late Monday that global deaths from the disease have topped the one million mark, with total cases passing 33.4 million.
Pandemic sensitive stocks were leading the market lower Tuesday, although a softer U.S. dollar -- which generally trades in the opposite direction of equity markets -- provided some support in early European trading.
Futures contracts tied to the Dow Jones Industrial Average suggest a modest 25 point decline at the start of trading, following last night's gain that trimmed the September loss to around 3%, while those linked to the S&P 500 are indicating a 5 point dip at the open for the broader benchmark, which is down 4.25% so far this month.
The U.S. dollar index was marked 0.24% lower against a basket of its global peers, at 94.04, while benchmark 10-year U.S. Treasury yields were last seen at 0.658%.
In Europe, where investors were focused on a key reading of German inflation showed consumer prices fell -0.4% this month, ahead of the region-wide estimate set to be published Friday, benchmark 10-year German bund yields fell to a seven-week low of -0.542%.
The overall market caution ahead of tonight's Presidential debate clipped yesterday's gains for the Stoxx 600, which fell 0.3% in early trading, while a firmer pound pushed Britain's export-focused FTSE 100 0.4% lower in London.
Global oil markets also drifted lower in the defensive session, with traders worried the Speaker Pelosi's stimulus package remains too far apart from Republican spending targets -- and too close to the November elections -- to find favor in Congress and change the fading demand dynamics in domestic and global fuel demand.
WTI contracts for October delivery, the U.S. benchmark, traded 29 cents lower from their Monday close in New York to change hands at $40.31 per barrel while Brent contracts for November, the global benchmark, were seen 21 cents lower at $42.22 per barrel.
Stocks in Asia posted gains linked to last night's 410-point rally for the Dow, but the follow-through was oddly muted for such a strong Monday session, with Japan's Nikkei 225 rising only 0.12% to close at 23,539.10 points and the region-wide MSCI ex-Japan benchmark bumping 0.1% higher heading into the close of trading.