COVID & Blue Wave Repricing Applies Pressure In Early Trade This Week

Participants looked to the uptick in COVID cases in Europe and mitigation measures that have been enacted over the weekend (most notably in Italy & Spain). While it is true that the latest round of infections has not been subjected to the mortality rate witnessed during the first major round of European cases, governments are still willing to impose lockdown/mitigation measures, which will have an economic impact. The latest COVID cluster outbreak in China (in the Xinjiang province) was also noted, as was the recent re-pricing of "Blue Wave" election outcome odds on the PredictIt platform.

• E-minis were offered as a result, as the S&P 500 contract bounced around within the confines of its early Asia-Pac range, even as the cash equity open in China saw some fresh weakness for the contract. Still, the nearby cluster of shorter-term DMAs (21-, 50- & 55-DMA metrics) hasn't been tested as of yet.
• Hong Kong observed a market holiday, sapping liquidity from the region.
• Chinese mainland equity indices felt some extra pressure on the back of softer than expected Q3 earnings from Kweichow Moutai. Participants await any leaks from the meeting re: China's next 5-Year plan, with policymakers sitting down to discuss the matter from today.
• Nikkei 225 -0.1%, Hang Seng closed, CSI 300 -0.5%, ASX 200 unch.
• S&P 500 futures -20, DJIA futures -164, NASDAQ 100 futures -50.