The Moody's Blues

Sunday futures feel the downgrade

Good evening, premium members!

Well, this weekend was the diametric opposite of last weekend. Seven days prior, I spent Saturday and Sunday wringing my hands about the promised US+China trade talks, and in the wee hours of Monday morning, the news hit that the U.S. has utterly surrendered the trade wars, which sent futures exploding in an historic rise.

This weekend, however, there was no such news (the U.S. can only surrender once, after all) but instead was in anticipation of the reaction to the Moody's downgrade of U.S. sovereign debt. As always, the IG Weekend trading was useless, since it pretty much showed the Dow down about 0.2% or so. When the futures actually opened, it was a bit more dramatic, although nothing at all in comparison to the converse move higher last weekend. The arrow represents when the news first hit Friday evening, and the rectangle shows the gap lower.