Opening Bell: U.S. Futures, Global Stocks Rebound; Oil Pressured, Gold Flat

Opening Bell: U.S. Futures, Global Stocks Rebound; Oil Pressured, Gold Flat  | Sep 14, 2020 07:21

  • Markets rally on positive COVID-19 vaccine news
  • Equities buoyed by significant corporate acquisition announcements
  • Oil under pressure ahead of OPEC+ meeting and negative outlook from BP (LON:BP)

Key Events

US futures and global stocks rose on Monday, following an array of positive corporate deal news and and further announcements on a COVID-19 vaccine. 

Contracts on the Dow, S&P and Russell 2000 increased more than 1% this morning while futures for the NASDAQ climbed 1.48% on the heels of last week's first back-to-back decline for US stocks since April, and the biggest losses since before markets bottomed in March. 

The dollar was slightly weaker while gold remained flat. 

Global Financial Affairs

Over the weekend, AstraZeneca (NYSE:AZN) announced it was restarting Phase III trials on its coronavirus vaccine and Pfizer (NYSE:PFE) CEO Albert Bourla said its vaccine may be distributed as early as the end of this year, improving sentiment.

It was reported that Oracle (NYSE:ORCL) was on track to announce it has won the partnership battle for TikTok, the Chinese social media app, beating out Microsoft (NASDAQ:MSFT).

Shares in SoftBank (OTC:SFTBY) jumped after NVIDIA (NASDAQ:NVDA) agreed to purchase the Japanese company’s chip division ARM for $40 billion.

And Gilead Sciences (NASDAQ:GILD) announced it will buy Immunomedics (NASDAQ:IMMU) for $21 billion. 

All of this positive dealmaking along with renewed hopes a COVID-19 vaccine, ahead of this week's Fed policy decision that is widely expected to remain dovish, provides bargain hunters all the fuel they require to jump right back into equities.

Analysts are also predicting that the acute US selloff may be coming to an end, having achieved a healthy correction. Of course, that assessment is based on the premise that the bull market will endure. Goldman says it remains “optimistic about the path of the US equity market in coming months.” 

While we cannot predict the future, we’re not as optimistic.

Putting aside all the fundamental arguments we’ve been making even as the US stock market provided investors the best returns in decades, the S&P 500 Index may be showing signs of a reversal.

We’re not bearish at this point, but we’re not bullish either. We’re on the fence. Here’s why:

Strictly speaking, the S&P completed a descending series of peaks and trough, after having found resistance by the top of a broadening pattern since January 2018. However, we won’t consider it a reversal unless prices decline below the previous trough in the uptrend.

S&P Daily

The 7% drop, followed by consolidation, may be biased to a downside breakout. Given that such a continuation pattern’s implied target is the preceding move, it may give the move the oomph needed to break the 3,200 support.

But, again, unless a new high is made or the price takes out the previous uptrend’s low, we’re on the fence.

The Stoxx Europe 600 Index advanced with all 19 industry groups, but as with US futures, technology shares led the gains.

Earlier, Asian stocks also advanced, breaking away from Friday’s wild whipsaws. South Korea’s KOSPI climbed 1.3% to a monthly high, led by a rally in Samsung Electronics (KS:005930). The index was also boosted by strong foreign demand and improved sentiment as social distancing rules were relaxed.

Australia’s ASX 200 was the second best performer during the Asian session. It was up 0.7% boosted by mining stocks as well as on the news that the state of Victoria, the country's COVID hotspot, reported its lowest one-day climb in new cases in almost three months.

Japan’s Nikkei 225 followed, (+0.65%), as its ruling Liberal Democratic Party nominated a new leader, Yoshihide Suga, rendering him the next Prime Minister.

Friday was the fourth loss in five days for megacap technology shares, on worries that valuations were unjustifiably high after a five-month rally. The NASDAQ Composite dropped 0.6%, but even the S&P 500, which closed flat for the day, fell as much as 2.1% for the week, as volatility returned to stocks.

Yields, including 10-year Treasuries, edged lower along a H&S top, pressured by the 200 DMA, and with momentum falling.

US 10-Year Daily

The pattern is not defined only by the recent, narrow price action, but remains in a slim range even via the MACD.

The dollar declined from the top of a falling channel since May and the top of a range since July 28. 

Dollar Index Daily

The USD's more sensitive RSI has fallen below its resistance since mid-June, while still up after the MACD’s short MA peaked above its highest since July 2.

Gold rose from the bottom of a potential bearish flag, the third consecutive such pattern, developing within a larger pennant, bullish within the uptrend. 

Gold Daily

However, only a decisive pennant breakout will determine the precious metal's next push.

Bitcoin rose within a pennant.

Bitcoin Daily

The cryptocurrency was bearish after the preceding downside breakout of a H&S that achieved the pattern’s implied target within a single day, which also broke its uptrend line since the early March bottom.

Oil gave up on its first advance in four sessions after back-to-back weekly losses ahead of an OPEC+ meeting. Energy major BP (NYSE:BP) said that oil consumption may never return to the levels seen before the pandemic.

Oil Daily

WTI has been developing a pennant bearish after the preceding 16.75% plunge within 6 sessions, completing a rising wedge, itself bearish after the climatic rally that preceded it. A downside breakout will set a decline toward $30.

Up Ahead

Market Futures



  • The Dollar Index declined 0.25% to 93.08.
  • The euro was little changed at $1.1851.
  • The British pound advanced 0.2% to $1.2826.
  • The Japanese yen strengthened 0.2% to 106 per dollar.
  • The offshore yuan strengthened 0.1% to 6.8294 per dollar.


  • The yield on 10-year Treasuries declined less than one basis point to 0.66%.
  • The yield on two-year Treasuries climbed less than one basis point to 0.13%.
  • Germany’s 10-year yield fell one basis point to -0.49%.
  • Britain’s 10-year yield sank two basis points to 0.166%.
  • Japan’s 10-year yield declined one basis point to 0.021%.


  • West Texas Intermediate crude increased 0.3% to $37.49 a barrel.
  • Brent crude was little changed at $39.93 a barrel.
  • Gold strengthened 0.3% to $1,947.11 an ounce.

Related Articles

Latest comments

Add a Comment
Please wait a minute before you try to comment again.
Write a reply...
Please wait a minute before you try to comment again.

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.

English (USA) English (UK) English (India) English (Australia) English (South Africa) English (Philippines) English (Nigeria) Deutsch Español (España) Español (México) Français Italiano Nederlands Português (Portugal) Polski Português (Brasil) Русский Türkçe ‏العربية‏ Ελληνικά Svenska Suomi עברית 日本語 한국어 简体中文 繁體中文 Bahasa Indonesia Bahasa Melayu ไทย Tiếng Việt हिंदी
Sign out
Are you sure you want to sign out?
Saving Changes


Download the App

Get free real time quotes, charts and alerts on stocks, indices, currencies, commodities and bonds. Get free top of the line technical analysis/predictors. is better on the App!

More content, faster quotes and charts, and a smoother experience is available only on the App.