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Political Unrest Has Stocks Grumpy

September 29, 2014 7:30 AM EDT

Stock futures are lower today with politics in focus. In Spain, Catalonia's president signed a decree to schedule a non-binding referendum for independence on 9 November. In Asia, protesters clashed with police in Hong Kong.

Dow futures are down 99, S&P 500 futures are down 11.50 and Nasdaq futures are down 24.

Commenting on the Catalonia development, Nomura said, "Our European economics team believes that a referendum – if held – is not a systemic risk for Spain and Europe and that the likelihood of Catalonia becoming an independent state outside of Spain's central government jurisdiction is very small."

In Hong Kong pro-democracy protesters flooded the streets after Beijing imposed limits on how Hong Kong elects its leaders. Nomura noted that as the 1 October “National Day” holiday is approaching, there are risks that these protests continue or intensify. "Our senior political analyst, Alastair Newton, believes that, if tensions deepen in Hong Kong, the risk of a market-moving event (and damage to broad business sentiment) would be non-negligible – with the possibility that an assertive stance by Beijing could also reverberate into Taiwan politics. Indeed, in Taipei, a group of protesters has gathered outside the Hong Kong cultural office in a show of support, while President Ma Ying-jeou said Taiwan was closely watching the situation in Hong Kong."

Traders will also be watching for data on US personal income and spending and US pending home sales later this morning.



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Pending Home Sales, Standard & Poor's, Nomura, Personal Income/Spending