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Futures Point to a Risk-Off Session

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S&P futures are trading moderately lower after the European session saw some selling after yesterday’s rally. The weakness has less to do with virus fears and more with the Hong Kong situation. The new National Security Law that China has imposed on the city is leading to unrest. Additionally, we saw a reaction from the U.K. criticizing China, saying that the law is a “clear violation” of the autonomy of Hong Kong.

The world is very upset at China at the moment. If there is joint economic action against the country, it could harm global trade. For that reason, the headlines involving Hong Kong over the next few weeks could be market moving.

Economic data on jobs out before the bell, with the Challenger Job Cuts printing 170K v the 397k prior. The June payrolls report will be a market mover tomorrow and some traders will use these numbers as an indicator of what we might see.

S&P Futures Trading Levels

The S&P futures currently sit at 3066, about 30 handles off the highs from yesterday.  

Support levels for the day will be 3061 and 3043.

Upside resistance is 3090 and 3114.

The current environment is trending sideways, with bullish responses to “bad” news creating a positive environment for stocks. The holiday shortened week will likely keep volumes to the lower side.

Three Stocks to Watch

FDX- Big quarter for FedEx as the company crushed expectations on both the top and bottom line. The stock is trading up 11% in premarket trading. UBS and JPMorgan both raised price targets for the stock above $180, over 28% from yesterdays close.

BYND- Fake meat makes its move into China, which is good for 10% pre-market move. The company reached an agreement to sell products at Freshippo retail stores in China, giving Beyond Meat an entry into a very large market.  

STZ– Constellation Brands reported EPS this morning, with a slight miss on the revenues, but a 28 cent beat on the bottom line. The stock is trading slightly higher in the premarket, up almost 3%.

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