US stock index futures have settled in the green territory
On Tuesday, European stocks erasing losses along with US futures, locking their wounds after a broad-based sell-off witnessed yesterday. However, the recovery momentum looks too shy and unsustainable to bet on more robust gains in the short term.
Rising coronavirus cases globally triggered rising concerns over another lockdown and a deeper economic crisis. The negative sentiment was fueled by lingering political uncertainty ahead of US presidential elections, persisting tensions between the United States and China, Brexit woes, and a sharp sell-off in the oil market.
As a result, European stock markets saw the worst session in three months on Monday, trying to recoup losses today. However, the rebound looks fragile and indecisive as investors remain cautious, focusing on coronavirus-related developments that driving global markets again.
Elsewhere, the dollar has already reversed its intraday gains as risk sentiment keeps improving ahead of the opening bell on Wall Street. US stock index futures have settled in the green territory, however, the selling pressure could reemerge at any point and drive stocks lower again.
On the positive side, the German IFO Institute revised its forecast on the German economy to -5.2% from -6.7% previously. As a reminder, at the start of this month, the German government made similar adjustments to its forecasts.
Meanwhile, oil prices turned higher on the day in a reaction to recovery in global stocks. Brent crude regained the $42 handle but still struggles to stage a more decisive recovery. Furthermore, the futures could resume the decline as the barrel could attract profit-taking at higher levels due to persisting uncertainty surrounding the outlook for demand recovery amid surging virus cases.
As for other markets, bitcoin remains under pressure following two days of decent losses. The leading cryptocurrency is flirting with the 100-daily moving average for the first time in a week. as long as the prices stay above this MA that arrives around $10,400, downside risks are limited. On the upside, BTCUSD needs to clear the $10,500 figure in order to retarget the $11,00 barrier.