US stock futures are very reluctant to follow through on Friday’s bounce. With recession risk providing a significant overhang amid a hawkish Fed drumbeat, traders still think US stocks are not cheap enough to harvest above-market returns relative to risk-free assets.
European stocks should continue to thrive, catching a tailwind from the China border reopening bounce, while the stronger Euro should encourage inflows.
Despite what should be good for more than a 1-dollar bounce in oil markets in Asia, warmer European weather likely obscures the more pronounced positive shift from China’s borders reopening. The unseasonable warm spell impacts not just Europe but also the US. January warmth is set to have twice the impact of the December cold spell depressing demand for all winter fuels significantly lower.
