Join +750K new investors every month who copy stock picks from billionaire's portfoliosSign Up Free

Opening Bell: Futures, Stocks Gather Momentum On Stimulus, Brexit Deal; Oil Up

Published 12/29/2020, 06:31 AM
  • US House votes to increase direct payments to $2,000; vote now goes to Republican-controlled Senate
  • Bitcoin finds resistance after $28,000 record.
  • Key Events

    US contracts for the Dow Jones, S&P 500, NASDAQ and Russell 2000 advanced on Tuesday, along with European stocks. Two driving factors: the potential for a larger US stimulus package along with the ongoing positive sentiment from last week's eleventh-hour Brexit deal between the EU and UK which was signed ahead of the Christmas holiday.

    Treasury yields edged higher, the dollar fell and oil jumped on prospects of increased demand in 2021.

    Global Financial Affairs

    Momentum from yesterday's record breaking rally on Wall Street extended this morning to US futures and European shares. Adding to positive sentiment, the House voted yesterday evening to boost the size of individual stimulus checks from $600 to $2000, something US President Donald Trump had demanded when he refused to sign the fiscal aid package before the holiday. Though Trump signed the $900 billion aid package into law on Sunday, the individual relief payouts were not altered.

    The Senate is expected to vote on the raise later today. Stiff resistance from Republicans is expected.

    On Tuesday, all four US contracts were in the green, after each posted fresh all-time highs on Monday. However, futures on the Russell 2000 lagged, as they did yesterday when they were the only index that closed in the red.

    The Stoxx Europe 600 Index advanced with every sector gaining, except for banks and energy. The UK's FTSE 100 opened 1.5% higher and extended the rally to 2.5%, its highest point since Mar. 5, after the 27 ambassadors of the EU member nations officially approved the Brexit deal, to be implemented on Jan 1.

    London-based drugmaker AstraZeneca (LON:AZN) jumped 3.6%, ahead of the expected approval of the company's COVID vaccine for use in the UK this week.

    Most Asian indices climbed, following the New York session higher. Japan’s Nikkei 225 surged 2.7%, outperforming the region and hitting a 30-year high.

    Hong Kong’s Hang Seng jumped, (+1%), as bargain hunters snapped up regional shares of Alibaba (NYSE:BABA) (HK:9988) after a sharp two-day selloff during which the stock shed 16% of its value.

    Alibaba Daily

    However, we consider this rise part of market dynamics that follow a H&S top, leaving risk to the downside.

    Despite the prevailing risk-on appetite, yields, including for the 10-year Treasury note, edged higher.

    UST 10Y Daily

    The move occurred within a tight continuation pattern, within a rising channel.

    The dollar slumped once again.

    DXY Daily

    Though it was off its lows, traders struggled after the greenback completed a second consecutive bearish pattern within a falling channel.

    Gold rose on dollar weakness.

    Gold Daily

    The precious metal completed a falling flag on Monday, which followed a H&S bottom. Bulls are now attempting to break out of a falling channel.

    Bitcoin retreated from its newest record high, above $28K, though, like the dollar, it's now off its lows.

    BTC/USD Daily

    Technically, the digital currency is contending with an extremely bearish shooting star, following a sharp rally.

    Oil opened higher, on hopes the newest round of US stimulus will spur demand.

    Oil Daily

    WTI is struggling to stay above $48 after finding resistance by its broken uptrend line.

    Up Ahead

    Market Moves



    • The Dollar Index fell 0.3% to 90.06.
    • The euro gained 0.3% to $1.2251.
    • The British pound jumped 0.5% to $1.3513.
    • The onshore yuan strengthened 0.1% to 6.53 per dollar.
    • The Japanese yen moved 0.2% to 103.64 per dollar.


    • The yield on 10-year Treasuries advanced two basis points to 0.95%.
    • The yield on two-year Treasuries increased one basis point to 0.13%.
    • Germany’s 10-year yield increased less than one basis point to -0.56%.
    • Japan’s 10-year yield was unchanged at 0.025%.
    • Britain’s 10-year yield fell three basis points to 0.223%.


    • West Texas Intermediate crude increased 1% to $48.08 a barrel.
    • Brent crude gained 1% to $51.39 a barrel.
    • Gold strengthened 0.3% to $1,879.93 an ounce.

Latest comments

Loading next article…
Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.