Explore Special Offers & White Papers from ADMIS

Global Equity Markets Higher Overnight


Global equity markets overnight were higher with gains ranging from 0.5% to as high as 1.4% in Germany. Clearly the markets are cheered by the prospect of a-final-end to the exit and from another step toward a US stimulus agreement. The US markets should derive fresh speculative buying from a report late last week that online US retail sales from the October 11th to December 26th holiday shopping period increased by 3% over the prior year. The markets might also derive a measure of support from a large $10 billion stock buyback by AliBaba.


While the dollar has not forged a fresh lower low for the move it did violate the 90.00 level temporarily in a fashion that leaves the bear camp hopeful. On the other hand, the bull camp should be disheartened by the markets lack of definitive downward motion in the face of 2 major events overnight that clearly justified the removal of additional flight to quality investments/trades. We suspect the dollar will catch a temporary lift from this morning’s US Dallas Fed Manufacturing Business Index, and we think the Index will be held up by support at 89.89.


With a risk on mentality in place to start the new trading week, the path of least resistance is still pointing down in bond and notes. While there would appear to be more negotiations before a fully agreed-upon stimulus package is a reality, a shift toward larger direct checks is a fresh underpin for the US economy and a fresh negative for Treasuries. In fact, some economists suggest that additional stimulus checks will help extend the US recovery which by many statistical measures has decelerated over the last 2 months. There would also appear to be flight-to-quality selling in bonds and notes off the looming exit deal but also from traders selling to balance positions ahead of year end. One can rationalize current price levels (near a downside breakout of post Covid-19 lockdown panic pricing) because of the global dissemination of vaccines and now more specifically because of the potential for direct stimulus checks that could bring the US economy through the final stresses of the pandemic. While not a major driving force on prices today the Dallas Fed manufacturing business index could provide a measure of temporary support before the attention in the marketplace shifts to a series of 3 and 6-month bill auctions and then to 2 and 5-Year Note actions at mid-session.

Risk Warning: Investments in Equities, Contracts for Difference (CFDs) in any instrument, Futures, Options, Derivatives and Foreign Exchange can fluctuate in value. Investors should therefore be aware that they may not realise the initial amount invested and may incur additional liabilities. These investments may be subject to above average financial risk of loss. Investors should consider their financial circumstances, investment experience and if it is appropriate to invest. If necessary, seek independent financial advice.

ADM Investor Services International Limited, registered in England No. 2547805, is authorised and regulated by the Financial Conduct Authority [FRN 148474] and is a member of the London Stock Exchange. Registered office: 3rd Floor, The Minster Building, 21 Mincing Lane, London EC3R 7AG.                  

A subsidiary of Archer Daniels Midland Company.

© 2021 ADM Investor Services International Limited.

Futures and options trading involve significant risk of loss and may not be suitable for everyone.  Therefore, carefully consider whether such trading is suitable for you in light of your financial condition.  The information and comments contained herein is provided by ADMIS and in no way should be construed to be information provided by ADM.  The author of this report did not have a financial interest in any of the contracts discussed in this report at the time the report was prepared.  The information provided is designed to assist in your analysis and evaluation of the futures and options markets.  However, any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to ADMIS. Copyright ADM Investor Services, Inc.

Latest News & Market Commentary

Explore Special Offers & White Papers from ADMIS

Get Started