There is an 88% chance that the Fed will cut 0.25% off interest rates on Dec. 10, according to the rarely wrong CME FedWatch futures market. But that implied promise of a fresh round of cheaper money wasn’t enough to boost U.S. stock futures this morning. S&P 500 futures were down 0.64% premarket; Nasdaq 100 futures were down 0.78%.
The pessimism started in Asia, with Japan’s Nikkei 225 down 1.89%, and the South Korea KOSPI down 0.16%. Europe was little better. The STOXX Europe 600 was down 0.21% in early trading and the U.K.’s FTSE 100 was down 0.14% before lunch.
It was all a stark contrast to Friday’s trading in the U.S., when the S&P closed up for its fifth straight session. The talk over the weekend was that this signaled the beginning of a “Santa Rally,” the myth that stocks do well in December as traders enjoy the jollity of the holiday season (and the Q4 corporate revenue picture becomes clearer).
Unfortunately, the tech sector is spoiling the party: Bitcoin sank to $85K early this morning before regaining the $86K level. That’s far below its record high from earlier this year of $125K. “It’s beginning to look a lot like a crypto winter,” RBC’s daily morning email said.
