S&P 500 Futures renew three-week high on Fed, China chatters, yields dribble on US bank holiday

• Market sentiment remains firmer amid easing Fed bets, receding covid-led controls in China.
• S&P 500 Futures track Wall Street’s gains to print four-day uptrend.
• US Treasury yields remain inactive amid Memorial Day bank holiday.
• Light calendar, fewer macros may restrict market moves.

Global markets remain mildly positive during Monday’s Asian session as traders anticipate a softening of the rate hikes amid concerns over inflation and growth. However, a holiday in the US and a light calendar seem to restrict short-term market moves.

While portraying the mood, the S&P 500 Futures rise 0.35% intraday around 4,170, the highest level in three weeks. It’s worth observing that the US 10-year Treasury yields remain pressured around a monthly low near 2.74%. inactive by the press time.

Mostly downbeat figures of the US concerning consumption, income and inflation seem to have recently doubted the Fed’s 0.50% rate hikes post-September. The traders’ indecision also probed the US Treasury yields of late, which in turn weighed on the US dollar index and allowed markets to remain positive.

That said, the US Personal Consumption Expenditure (PCE) data came in mixed for April, mostly downbeat, as the Core PCE Price Index matched 4.9% YoY forecasts versus 5.2% prior. Further, Personal Income rose less than expected but the Personal Spending improved. Following the data, traders propelled the Wall Street benchmarks but kept the bond yields intact.

Other than the Fed-linked chatters, headlines from China, suggesting a faster easing of the covid-impressed activity restrictions, also help markets to remain positive.

“Shanghai said on Sunday ‘unreasonable’ curbs on businesses will be removed from June 1, as it looks to lift its COVID-19 lockdown, while Beijing reopened parts of its public transport as well as some malls and other venues as infections stabilized,” said Reuters.

Moving on, this week’s US jobs report becomes the key catalyst for the markets and can help the US dollar to recover some of its latest losses should the headline Nonfarm Payrolls (NFP) rise past 310K forecast, versus 428K prior.

Also read: Risk sentiment has regained some of its zeal( Markets, Forex, Oil)