European sentiment boosts S&P 500
U.S. stock futures are following Europe higher this morning as the Japanese yen weakens and investors bet that politicians in Washington will address the fiscal cliff.
The S&P 500 is indicated to open higher by about one-quarter of a percent. France's CAC-40 is leading gains across the Atlantic with a gain of more than two-thirds of a percent, followed by London's FTSE-100.
The bullish sentiment has increased in the last hour as the euro pushes higher. Japan's Nikkei was the top winner in Asia overnight, climbing almost 1 percent.
There are still no clear signs that U.S. lawmakers will reach a deal with President Obama to avert tax increases and spending cuts at year-end. But the risk has been well known for months and investors appear increasingly comfortable that, even if the situation isn't fixed immediately, it will be addressed by early 2013 after the new Congress is seated.
Worries about the fiscal cliff had caused the S&P 500 to pull back from multi-year highs between mid-October and mid-November. It's been rebounding since then and has been attempting to build support above its 50-day moving average in the last two weeks, which could be leading some chart watchers to expect further gains.
In addition to the political news, the market has a full docket of economic data today. Weekly jobless claims will be released at 8:30 a.m. ET, followed by new home sales and consumer confidence at 10 a.m. ET.
Foreign-exchange markets are painting a bullish picture this morning, while commodities are more negative. Currencies that tend to follow risk appetite--the euro, Australian dollar, and Canadian dollar--are all higher. The Japanese yen is also lower across the board, which tends to support equities because investors use it as a safe haven.
Oil and copper, however, are modestly lower. Precious metals are down by almost half a percent, and most agricultural foodstuffs are posting small declines.
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