Stocks gain despite political deadlock
Stocks are inching higher this morning amid continued political deadlock in Washington and positive signs in Asia.
S&P 500 futures are up by about 0.25 percent after the index tumbled more than 1 percent on Friday. Trading is mixed overseas, with Britain and Germany lower, but France's CAC-40 up almost 1 percent. Japan's Nikkei continued its recent advance by adding another 0.7 percent. Shanghai rallied 1.7 percent as China's economy continues to gain momentum.
The United States faces the specter of increased taxes and forced cuts in spending tomorrow morning unless politicians in Washington reach an agreement to reduce the budget deficit. Republicans and Democrats have been deadlocked for weeks, with neither side willing to compromise. In contrast, the news overseas has been increasingly positive of late, with economic growth accelerating in China and new leadership in Japan lifting sentiment there.
Just today, the HSBC Purchasing Managers Index for China had a final reading of 51.6 for December. That's an increase from the 50.9 preliminary number released earlier in the month. The report also showed the strongest pace of new orders in almost two years.
Foreign-exchange markets and commodities are painting a mixed picture this morning. The euro and oil are lower against the U.S. dollar, which is consistent with risk aversion. But copper is up by more than 1 percent and the Japanese yen is lower across the board. Most agricultural foodstuffs are down by more than 0.5 percent.
In company-specific news, credit-rating firm Duff & Phelps is indicated higher by 18 percent after agreeing to be acquired by a consortium of private-equity firms.
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