U.S. Stock futures rise on stimulus negotiations, China’s growth

American stocks saw muted gains last week as investors calculated consistently high Covid-19 cases, uncertainty surrounding the presidential election and a battle over further fiscal stimulus measures ahead of Washington.

Markets have largely written off expectations that U.S. The government’s large spending package is expected to be approved from November. But investors keep an eye on the progress of negotiations between legislators and the White House, from the point of view that the relief given to homes or pre-election businesses will be a bonus.

Over the weekend, House Speaker Nancy Pelosi told the White House that a deal with the Democrats could be reached by Tuesday. If a deadline passes without a deal, the ongoing negotiations are likely to create a multi-million dollar cost relief law in the next two weeks, his aide suggested. Mrs. Pelosi and Treasury Secretary Steven Munuchin spoke Saturday night, but many differences remain.

“US politicians seem to be coming together more creatively in terms of financial stimulus,” said Altaf Kasam, head of investment strategy for Europe, the Middle East and Africa at State Street Global Advisors. There is no immediate need for a financial stimulus package, but “if they can get a whole multipet agreement before the election, it will be huge.”

As Kovid-19 continues to spread, more financial stimulus will be needed to support the economy, said Robert McKay, chief cross-asset strategist at BNP Paribas..

“Without financial stimulus, you will see a new wave of unemployment and a new wave of ambiguity and default, and that will definitely weigh on growth,” he said.

Gross domestic product grew 9.9 percent in the third quarter a year earlier, while the epidemic dragged its economy back to its pre-coronavirus route, half a year after the epidemic gutted it, Chinese officials said Monday. Other economic indicators released on Monday offered additional signs of strength: China’s headline unemployment figure, the unemployment rate in the urban survey, fell to 5.4% in September.

“If you look at the customer numbers, the manufacturing numbers, they’re still very strong coming out of China,” Mr. Kasam said. “It starts us off in a positive tone, and we think it’s a theme that will continue.”

Investors in China and Hong Kong reacted mixedly to the latest economic data, with 9.9% growth in the third quarter falling short of expectations. The Shanghai Composite Index closed 0.7% lower, reversing the initial gain of more than 1%. Awaiting gains for the day’s 0.6% rise in Hong Kong’s Hang Seng Index.

Iris Pang, chief economist at Greater China at Hong Kong’s ING Bank NV, said the latest data was good and the market was trending based solely on the number of headline growth numbers. “They didn’t digest the whole report,” he said.

Many concerns about the political uncertainty in the U.S. have also eased recently, investors said.

“Four years ago, the voting and betting markets were wrong,” said Mr Kasam, who said the election was unlikely to go ahead. “The worst outcome of the U.S. election for the markets would be a fight, a protracted election.”

U.S. The corporate earnings season will accelerate this week with Netflix,

Among the major companies reporting in the coming days are Tesla and AT&T.

Shares of Texas Shell Driller Concho Resources rose 3.3% in the pre-market on news that ConocoPhillips would acquire the company in a ket.ket billion-all-stock deal.

Shares of American Equity Investment Life Holdings fell 9.4% in trading. On Sunday, the company rejected a takeover offer from Massachusetts Mutual Life Insurance and Ethan Holding.,

And said it has reached out in partnership with Brookfield Asset Management instead.

Shares of oil-field services company Halliburton fell 1.1% in the pre-market while it posted a loss of 17 17 million in the third quarter, compared to a profit of 29 295 million in the previous quarter. The technology giant will report after the international trade machines market closes.

Shares of Front Yard Residential rose 35% after the U.S. Virgin Islands-based real estate investment trust said it had agreed to acquire the funds through a group led by investment firm Premium Partners LLC and managed by Ares Management. Corpo.

In a deal worth about 4 2.4 billion.

“It’s all about guidance, and the guidance in the U.S. has certainly been much better than expected,” said Andrew Cole, head of Multi Asset in London at Pickett Asset Management. “Everyone knows that earnings this year are going to be pretty awful from a year-over-year perspective, so when we start thinking about earnings, it’s as important as 2021,” he said.

Production on the 10-year Treasury note ticked from 0.743% to 0.770% on Friday. The WSJ Dollar Index, which tracks currencies against the basket of others, falls below 0.4%.

U.S. The main gauge of crude-oil futures fell 0.3% to .9 40.98 a barrel.

Overseas, Stocks Europe 600 percent 0.1%. EuropeNest NV, which operates exchanges across Europe, said it had resolved a technical issue that had halted trading in some markets.

Hong Kong’s Cheng Koh Ping contributed to this article.

Write to Mischa Frankl-Duval at [email protected]