(Bloomberg) — US equity futures were steady, with the S&P 500 poised for its best week in a year after Donald Trump’s election as US president sparked a risk-on frenzy. US Treasuries advanced, recouping much of their post-election losses.
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Enthusiasm that potential tax cuts and deregulation under Trump will spur growth and profits has propelled the US equity benchmark to within a whisker of the 6,000 level. Bonds got some relief after the Federal Reserve delivered a quarter-point interest-rate cut and left the door open for further easing next month.
“Historically soft landings, which we appear to be in the middle of given the latest economic readings, tend to bolster equity markets,” Jennifer Bender, Chief Investment Strategist, State Street Global Advisors said. Trump policies “are likely to keep these tailwinds going for equities. Resilience in US corporate earnings adds to this healthy picture.”
In China, stocks and the yuan declined after Beijing authorities announced a total 10 trillion yuan ($1.4 trillion) program to refinance local government debt, signaling investors weren’t impressed with the latest attempt to support the economy.
The disappointment reverberated across markets as European stocks swung from gains to losses, led by declines in China-sensitive sectors such as mining, luxury and autos. Oil extended declines while iron ore fell.
It “looks like it is just a debt swap, which is frankly not going to be that exciting for markets,” said Bernie Ahkong, global multi-strategy alpha chief investment officer at UBS O’Connor. “The big factor between now and the end of the year is if we are going to get some incremental stimulus from the consumer side.”
Friday’s moves follow a cross-asset rally on Thursday that was helped by Powell’s comments, which pointed to the strength of the US economy and said he doesn’t rule “out or in” a December rate cut. Powell added the election will have no effect on policy in the near term, and said he would not step aside if asked by Trump.
“Powell would not tip his hand on whether the Fed would likely cut rates in December,” said Bret Kenwell at eToro. “However, the Fed appears more comfortable with the labor market and the current US economic backdrop than they did a few months ago.”
Some of the main moves in markets:
Stocks
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The Stoxx Europe 600 fell 0.6% as of 10:16 a.m. London time
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S&P 500 futures were little changed
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Nasdaq 100 futures were little changed
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Futures on the Dow Jones Industrial Average were little changed
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The MSCI Asia Pacific Index rose 0.1%
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The MSCI Emerging Markets Index fell 0.2%
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 -- US equity futures were steady, with the S&P 500 poised for its best week in a year after Donald Trump’s election as US president sparked a risk-on frenzy. US Treasuries advanced, recouping much of their post-election losses.Most Read from BloombergKey Ballot Initiatives and Local Races Highlight Views on Abortion, ImmigrationParis Restricts Through Traffic in City CenterFrom Housing to Immigration, Key Ballot Initiatives and Local Races to FollowEnthusiasm that potential tax cuts){kind=link}