Wall Street ended higher on Friday, thanks to the return in risk appetite spurred by higher crude oil prices. US oil rigs reported a decline once again, leading to speculations of lower production levels and stronger upward pressure on prices. WTI crude oil edged close to $39/barrel and Brent crude oil tested the resistance at $41/barrel again.
The Dow 30 index is up 218.18 points to 17,213.31 (+1.28%) and futures for March delivery are down 2.5 points (-0.01%). The S&P 500 index is up 32.62 points to 2,022.19 (+1.64%) and futures are down 1.01 points (-0.05%). The Nasdaq is up 86.31 points to 4,748.47 (+1.85%) and futures are up 0.62 points (+0.01%).
Asian market still looking positive after Chinese data
Equity indices and futures are all in the green so far, despite mixed data released from China over the weekend. Industrial production rose 5.4% year-over-year, lower than the projected 5.6% gain, while fixed asset investment showed a large 10.2% jump versus the projected 9.5% increase. Meanwhile, retail sales showed a 10.2% year-over-year increase instead of the estimated 10.9% rise, lower than the previous month’s 11.1% gain.
The China A50 index is up 168.92 points to 9,405.41 (+1.83%), the Hang Seng is up 258.40 points to 20,458.00 (+1.28%), and the Nikkei 225 index is up 341.63 points to 17,280.50 (+2.02%). Risk-taking could carry on as China A50 futures are up 130.50 points (+1.41%), Hang Seng futures are up 214 points (+1.04%), and Nikkei 225 index futures are up 305 points (+1.80%).
Quiet start to potentially volatile trading week
There aren’t much catalysts on deck today so this risk-on mood could stay in play before investors start pricing in expectations for this week’s top-tier events. Among these is the FOMC interest rate decision during which Fed policymakers would also release their updated forecasts for growth and inflation, as well as their dot plot forecasts for rate hikes.
Tomorrow, the BOJ interest rate decision is scheduled and the latter half of the week has rate statements from the BOE and the SNB. No actual easing efforts are expected but these central banks could also ramp up their dovish biases especially after the RBNZ and ECB doled out more stimulus last week.
Keep in mind also that this is the last full trading week ahead of the Holy Week holidays and the end of the month and quarter, which opens up the case for potential reversals on profit-taking.