December 17, 2012-Markets Choked on Fiscal Cliff Fears

Fiscal cliff fears continue to haunt traders, as reflected by the U.S. index futures, which point to a slightly higher opening on Monday. Earlier in the global trading day, most Asian markets succumbed to fiscal cliff fears, although the Japanese market was cheered by elections results, which are seen to lay the foundation for further relaxation of monetary policy necessary for kick starting growth. The U.S. fiscal cliff fears have not spared European markets either. Sentiment going into the session may also be dictated by the results of regional manufacturing survey due for the day. The Dow futures are rising 5 points and the S&P 500 futures are adding 0.70 points, while the Nasdaq 100 futures are declining 9.75 points. With the fiscal cliff talks still hanging in a limbo, U.S. stocks meandered to a modestly lower opening in the week ended December 14th. For the week ended December 14th, the Dow Industrials ended down 0.15 percent and the S&P 500 Index lost 0.31 percent, while the Nasdaq Composite fell 0.23 percent. After a week of fairly positive data points, the markets head into another week, when fiscal cliff fears are likely to reach a feverish pitch, given the ticking of the clock ahead of the deadline. In the unfolding week, traders are likely to focus on a few housing reports, manufacturing data, a consumer sentiment reading, consumer spending data and the results of a couple of manufacturing surveys.