S&P 500 Futures portray anxiety over US debt ceiling extension, China news

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  • S&P 500 Futures fade rebound from weekly low, mildly offered at the latest.
  • US President determined to get the debt limit extended despite strong rejection from Republicans.
  • Sino-American headlines suggest a pause in geopolitical/trade tensions but risks to China’s financial markets prevails.
  • Fed tapering tantrum escalates following firmer data, US ADP Employment Change eyed.

S&P 500 Futures wobble around intraday low, down 0.25% on a day near 4,325 amid early Wednesday.

The risk barometer cheered hopes of getting the US stimulus passed and the extension to the US debt limit before the Republicans smashed optimism with their hard stand versus President Joe Biden’s proposals.

US President Biden stays optimistic over having the US debt ceiling extended before the October 18 deadline despite the GOP rejection. The policymaker recently said, per Reuters, “A carve-out of the filibuster for the debt limit is a real possibility.”

The reason for the indecision could be the latest shift in the Republican policymakers’ tone and the global rating giant Moody’s keeping of the US credit rating.

Alternatively, the news of the US Trade Representative’s (USTR) investigation over the exclusion of China imports joins US President Biden’s phone call with his Chinese counterpart and readiness to respect the Taiwan agreement to keep buyers hopeful.

It’s worth mentioning that the Fed tapering chatters gained momentum after firmer US PMIs as well as hawkish comments from the US Federal Reserve (Fed) policymakers, which in turn favors the US Treasury yields while weighing on the stock futures.

Against this backdrop, the US Dollar Index (DXY) keeps the previous day’s upside moves near the 94.00 threshold by the press time.

Looking forward, market players will pay close attention to the risk catalysts and the US ADP Employment Change for September for fresh impulse ahead of Friday’s US Nonfarm Payrolls (NFP).

Read: US ADP Employment Change September Preview: Yes, its all about the Fed