#ES Drop & Pop

Index Futures Net Changes and Settlements:

Foreign Markets, Fair Value and Volume:

• In Asia 6 out of 11 markets closed lower: Shanghai Comp -0.44%, Hang Seng +0.31%, Nikkei -1.11%
• In Europe 8 out of 13 markets are trading higher: CAC +0.33%, DAX -0.19%, FTSE -0.21%
• Fair Value: S&P -0.97, NASDAQ +4.30, Dow -18.52
• Total Volume: 1.29mil ESM & 1,279 SPM traded in the pit

Today’s Economic Calendar:

Today’s economic calendar includes the Weekly Bill Settlement, William Dudley Speaks 4:15 AM ET, Jobless Claims 8:30 AM ET, FHFA House Price Index 9:00 AM ET, Bloomberg Consumer Comfort Index 9:45 AM ET, Existing Home Sales 10:00 AM ET, EIA Natural Gas Report 10:30 AM ET, Raphael Bostic Speaks 10:35 AM ET, Kansas City Fed Manufacturing Index 11:00 AM ET, Patrick Harker Speaks 2:00 PM ET, Fed Balance Sheet and Money Supply 4:30 PM ET.

S&P 500 Futures: China Tariff Gap Fill

Yesterday’s trade started with Asian stocks closing mostly lower. Japan’s Nikkei closed down by -1.2% after a big jump in the yen, Hong Kong’s Hang Seng dropped -1.8%, and Shanghai stocks fell -1.4%. In Europe the Stoxx Europe 600 was was down -1%. The S&P 500 futures, which traded weaker overnight in a 21.75 handle range, opened yesterday’s cash session with a print of 2710.50, down -15.75 handles, and immediately pushed higher on the open, up to 2721.25 before 9:00 am, and then back down to the 2708.50 low just before 10:00 am.

From there, the equity futures rallied back up to the 2720.00 level before falling back to 2710.50 in the midday range, leading up to a sharp move higher after the 1:00 pm FOMC minutes release. At that time the ES stormed higher, up to 2732.75, going into the cash close, before settling the day at 2730.25, up +4.25 handles, or +0.16%.

In the end, It was all about filling Sunday nights China tariff gap. After a few days of weakness, and a decent early selloff yesterday, the ES regained its footing and rallied 25 handles off its low. In terms of the days overall tone, the S&P acted well after shaking off the early weakness, and rallied to new highs right into the end of the day, despite $700 million to sell MOC. In terms of the days overall volume, the early drop and pop helped push the days volume to over 1.2 million contracts, which is considerably higher than the last few days.

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