S&P 500 Futures refresh monthly high above 4,200 as covid, stimulus news join inflation jitters

• S&P 500 Futures regain upside momentum amid cautious optimism during a quiet Asian session.
• Canada prepares for early unlock, UK struggles with June 21 deadline.
• US infrastructure talks, inflation expectations and China-linked headlines also try to entertain traders.

S&P 500 Futures edge higher, after refreshing the one-month top, around 4,230, up 0.13% intraday, during early Tuesday. The risk-barometer eased the previous day amid mixed chatters over the Fed’s next moves before regaining the bullish power, though a mild one, amid talks over economic recovery from the pandemic and unlock measures in the West, not to forget the US stimulus headlines.

Friday’s downbeat US jobs report added extra strength in rejecting the reflation fears, also the Fed’s tapering woes. Though, comments confusing over the US central bank’s next move by Treasury Secretary Janet Yellen probed buyers the previous day.

However, a six-week low of the US inflation expectations, per the St. Louis Fed data, joins the chatters over US President Joe Biden’s infrastructure spending, to favor the bulls of late. Also on the same line was the Canadian government’s readiness to ease border restrictions and unlock Ontario before the deadline.

It’s worth noting that the Western tussles with China and the UK’s struggle with the virus strains, which endanger the June 21 deadline for unlocking, probe the market optimism. Additionally, cautious sentiment ahead of Thursday’s key US inflation data and the ECB are extra filters to the risk-on mood.

Amid these plays, the US 10-year Treasury yields fail to extend the previous day’s corrective pullback around 1.56% whereas the US dollar index (DXY) snaps two-day declines by the press time.

Given the lack of major data/events, global markets are likely to remain sidelined ahead of this Thursday’s important events. However, doubts over reflation and tapering may keep a tab on the upbeat sentiment.

Also read: Wall Street Close: Nasdaq prints mild gains amid subdued session