Shutdown Progress

US stocks look poised for a fresh move higher today as traders welcome signs that the US govt shutdown is finally coming to an end. Talks over the weekend between US senators resulted in a compromise bill gaining support from both Republicans and Democrats in the Senate. The move is the first procedural step on the way to ending the shutdown. After receiving enough support to be put forward, the bill will now have to pass through the House of Representatives. However, with markets sensing that sentiment is turning in favour of ending the shutdown, particularly with the Thanksgiving holiday ahead, there is a definite risk on tone with both the Nasdaq and S&P higher pre-market. Any further positive headlines this week should provide fresh upside impetus for stocks.

Trump Stimulus Plans

With the prospect of the US govt shutdown coming to an end, and with Fed easing back in focus following disappointing US data last week, near-term risks have turned back to the upside. Indeed, news also that Trump plans to grant US citizens (excluding high earners) a $2000 stimulus cheque on the back of tariff profits, is also feeding into bullish equities sentiment here. Prior stimulus payments have typically yielded higher equities prices through increased trading and investment activity. If markets receive confirmation this is going ahead, stocks are likely to push higher again.

Technical Views

S&P Futures

The correction lower in the S&P has seen the market briefly piercing below the bullish channel before reversing higher to close back inside the structure. Price is now fighting get back above the 6,811.25 level. For now, focus is on a rebound higher and a resumption of the bull trend with the 6,949.75 YTD highs the first objective or bulls ahead of a fresh breakout.