S&P500 Futures snap two-day losing streak with mild gains as yields drop ahead of US data

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• Market sentiment remains dicey as traders struggles for clear directions amid light calendar, mixed news about China, Russia.
• S&P500 Futures rebound from one-week low to print the first daily gains in three.
• US Treasury bond yields drop after China markets’ open.
• Traders brace for US Durable Goods Orders, CB Consumer Confidence and ECB President Lagarde’s speech.

Risk appetite remains dicey, slightly positive, as market players seek more clues after a sluggish start of the week. That said, the recent opening of Chinese markets for Tuesday’s trading, however, weighed on the US Treasury bond yields and the US Dollar as markets prepare for a busy day ahead.

While portraying the mood, S&P500 Futures print the first daily gains in three by bouncing off the lowest levels in eight days, up 0.20% intraday near 4,380 at the latest. That said, the US 10-year and two-year Treasury bond yields remain depressed at around 3.73% and 4.69% by the press time.

It should be noted that the US Dollar Index (DXY) remains pressured for the second consecutive day, mildly offered near 102.60 at the latest, whereas prices of Gold and Crude Oil print minor gains around $1,930 and $70.00 amid cautious optimism at the latest.

People’s Bank of China’s (PBoC) lower-than-expected fixing of the USD/CNY price recently pushed back the fears surrounding the world’s second-biggest economy. Furthermore, the easing of the Russia-linked geopolitical concerns, after the Wagner Group drops Moscow’s mutiny and President Vladimir Putin praises the mercenaries decision to retreat. Additionally, headlines from Reuters suggesting the Asian lobby group’s push for easing of Chinese companies’ overeseas listing also underpins the market’s latest optimism.

Apart from that, the trader’s preparations for the key US Durable Goods Orders for May, expected -1.0% versus 1.1% prior, as well as the US Conference Board’s (CB) Consumer Confidence for June, expected to arrive at 103.90 versus 102.30 prior, also seem to have favored the optimists of late. Also important will be European Central Bank (ECB) President Christine Lagarde’s speech at the ECB Forum.

The reason could also be linked to the previous day’s upbeat US data and hawkish Fed signals. That said, US Dallas Fed Manufacturing Business Index for June improved to -23.2 versus -26.5 expected and -29.1 previous readings. During the last week, the US Core inflation for May allowed Fed Chairman Jerome Powell to remain hawkish but the Purchasing Managers’ Indexes for June weren’t impressive enough. Even so, Federal Reserve Bank of San Francisco President Mary Daly signaled on Friday that two more interest rate increases this year would be a “very reasonable projection.”

Contrary to the aforementioned catalysts, the fears of higher rates and economic slowdown seem to check the optimists amid a dicey Asian session.

Also read: Forex Today: Steady markets ahead of central bankers and inflation data