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Jun 20, 2016

U.S. Stock Market Future Indications, by MarketWatch on June 20, 2016: Dow Futures Point to 200 Gain as Polls Show a Swing Away From Brexit

marketwatch.com

Barbara Kollmeyer
 
U.S. stock futures surged on Monday, as investors’ confidence was bolstered by polls showing a swing in support for the U.K. remaining in the European Union ahead of Thursday’s Brexit referendum.

Dow Jones Industrial Average futures YMM6, -0.02%  rose 202 points, or 1.2%, to 17,766, while S&P 500 futures SPU6, +1.27%  gained 26.1 points, or 1.3%, to 2,085. Nasdaq-100 futures NQU6, +1.26%  added 56.25 points, or 1.2%, to 4,415.75.
Wall Street stocks closed lower on Friday, largely amid fears that U.K. voters would choose a departure from the EU. All three major indexes finished with losses of more than 1% for the week. The Nasdaq Composite COMP, -0.92% was down 1.9%, its largest weekly fall since the end of April.
Brexit: Cameron likened to WWII appeaser Neville Chamberlain
During a televised program on Brexit, an audience member compared Prime Minister David Cameron to the British leader who tried to appease Adolf Hitler to avoid war.
Analysts expect the week ahead to be choppy for markets until the referendum is decided.
“The odds of the U.K. leaving the EU have fallen below 30% again, but there are at least five more polls to go, and given the 130% increase in GBP/USD 1-week implied options volatility on Friday, this is still a market that is fragile and happy to turn on a dime,” Chris Weston, chief market strategist at IG, said in a note to investors on Monday.
Read: Brexit could be yet another blow to U.S. earnings
Weekend polls reflected a shift in sentiment away from a Brexit. A Survation/The Mail on Sunday newspaper survey support for the “remain” side at 45%, versus 42% for “leave.” There is some speculation that the killing of U.K. politician Jo Cox has swayed some voters who were on the fence.
A YouGov/Sunday Times poll conducted June 16-17 showed 44% backing “remain,” while 43% said they would vote to exit. A similar poll conducted June 12-13 showed 43% for staying and 46% for leaving.
Read: Why the Brexit isn’t the biggest risk investors should worry about
Relief over the prospect of a Brexit rallied European SXXP, +3.20%  and Asian stocks as well. The Nikkei 225 index NIK, +3.44% closed up 2.3%, as the dollar USDJPY, +0.32%  rose against the yen.
The British pound GBPUSD, +1.9500% rose to $1.4651, from $1.4359 late Friday, on track to mark its largest one-day gain since 2009, according to CaxtonFX. WTI oil prices CLQ6, +1.50% climbed 87 cents, or 1.8%, to $48.84 a barrel. A loser in the day’s action so far was gold GCQ6, -0.68%  , which fell $5.10 to $1,289.70 an ounce.
Economic docket: No key U.S. data is scheduled for release on Monday. Minneapolis Fed President Neel Kashkari will moderate a panel on “too-big-to-fail-banks” at the Peterson Institute in Washington at 12:15 p.m. Eastern Time.
Investors will be listening closely this week to Fed Chairwoman Janet Yellen, who will spend two days testifying on Capitol Hill, first to the Senate Banking Committee, then to the House Financial Services panel.
Read: Scrooge-like spending habits of business underlie Fed worries about economy
Stocks to watch: Shares of The Walt Disney Co. DIS, +0.63%  could be in focus after its Pixar Animation Studio set a box-office weekend record for an animated film. “Finding Dory” took an estimated $136.2 million in its U.S. and Canadian debuts.
Anthem Inc. ANTM, +0.05%   and Cigna Corp. CI, +0.63%  could come under the spotlight after The Wall Street Journal reported, citing sources, that U.S. antitrust regulators have expressed some worries about the $48 billion merger of the two health insurers.