US Slaps $50 Billion In Tariffs On China And China Slaps Back

Index Futures Net Changes and Settlements:

Foreign Markets, Fair Value and Volume:

• In Asia 10 out of 11 markets closed lower: Shanghai Comp -0.70%, Hang Seng -0.43%, Nikkei -0.75%
• In Europe 13 out of 13 markets are trading lower: CAC -1.48%, DAX -1.58%, FTSE -0.38%
• Fair Value: S&P +4.47, NASDAQ +27.09, Dow +18.22
• Total Volume: 1.50mil ESU & 778 SPU traded in the pit

Today’s Economic Calendar:

Today’s economic calendar includes the NAHB Housing Market Index at 10 a.m. ET, Atlanta Fed President Raphael Bostic will speak at 1 p.m. ET, while New York Fed President John Williams will speak at 4 p.m. ET.

S&P 500 Futures: Tariff Knock Down And The ‘Late Friday RIP’

Friday’s trade started with the major Asian markets closing lower and the Stoxx 600 down -0.70% at midday. The Globex overnight trading range for the S&P 500 futures was 2771.25 to 2788.50, with 338,000 contracts traded. The first print off the 8:30 ct futures open came in at 2779.00, down -0.35%.

After the bell the ES traded 2779.75, sold off down to 2772.25, rallied up to a lower high at 2778.75, and then broke all the way down to 2765.50 at 9:39 am. After the low the ES rallied up to 2777.70, pulled back down to 2770.75, and at traded back up to 2778.50 just after 12:00.

The afternoon saw a drop back down to 2774.00, making a higher low in the early afternoon, before buy programs came in at 1:30 CT helping to push the ES up to a new high of the day at 2787.50 before trading low in the final hour.

The MiM was showing a sell side imbalance throughout the final hour, but paired back when the reveal came out as $101 million to sell. The ES chopped down to 2780.25 in the final hour, then moved back up to 2784.25 for a lower high before rallying on the 3:00 cash close, printing 2784.75, and settling the day at 2784.50, down -4.00 handles, or -0.14%.

In the end, I think everyone got a little too bullish. It was an easy short sale with the US announcing the new $50 billion in Chinese tariffs Thursday night into Friday morning, but the selling dried up and the futures went sailing higher late in the day. Everyone was asking what the late buy program was about, and when we searched around there really were not any headlines that caused the late rip higher. In terms of the markets overall tone, I would have to say things didn’t act all that bad. While we expected an early selloff, I have to admit the late late rip was a little surprising. In terms of the days overall trade, it was the highest volume day of the week.

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