Meanwhile, reports about a blast in Saudi Arabia’s capital Riyadh push WTI oil above the $53 level.
Stimulus Package Remains In Focus
S&P 500 futures are swinging between gains and losses amid uncertainty over the timing of the new U.S. stimulus package.
Not surprisingly, the $1.9 trillion stimulus plan which was proposed by U.S. President Joe Biden is facing some opposition from Republicans who want to implement a more targeted aid package. Joe Biden has already signaled that he was open to negotiations regarding eligibility details for $1,400 stimulus checks.
Why GameStop and Other Meme Stocks Were Ripping on Monday
Meanwhile, U.S. Senate Majority Leader Chuck Schumer indicated that Democrats could try to pass the bill with a majority vote. According to Schumer’s estimates, the next coronavirus aid package may be delivered in 4-6 weeks.
While stimulus uncertainty may put some pressure on the market, stocks continue to trade near all-time highs, and the general market mood remains very bullish.Advertisement
Blast In Riyadh Provides Support To Oil
WTI oil received additional support after news agencies reported that an exposion was heard in Riyadh, the capital of Saudi Arabia. At this point, the source of the blast is not known.
The market is traditionally eager to interpret any explosion in Saudi Arabia as a sign of increased tensions with Yemen’s Houthi forces. The explosion may serve as a near-term bullish catalyst for oil but it remains to be seen whether it will have any longer-term impact on oil prices.
That said, it should be noted that oil traders have successfully ignored worries about new COVID-19 variants which may force a third wave of lockdowns in Europe so additional bullish catalysts may be sufficient enough to push oil to multi-month highs which is good for oil-related stocks.
U.S. Dollar Tries To Gain Upside Momentum Ahead Of Fed’s Interest Rate Decision
The U.S. Dollar Index managed to settle above the resistance at the 20 EMA at 90.30 and made an attempt to get above the next resistance level at 90.50 ahead of Fed’s Interest Rate Decision which will be announced on Wednesday.
The market traditionally expects that the Fed’s commentary will be very dovish, but it remains to be seen whether it will be able to put additional pressure on the American currency.
The U.S. dollar has managed to rebound from lows seen at the beginning of this year, and a continuation of this rebound may hurt stocks and commodities.