By Medha Singh
Dec 26 (Reuters) – Wall Street was set to rise at open on Wednesday, indicating a slight respite after a punishing few sessions that left the S&P 500 on the brink of bear market territory on worries over slowing growth and the recent drama in the White House.
S&P 500 e-minis were up 0.85 percent at 8:48 a.m. ET, a day after the Christmas holiday. Dow e-minis were up 0.7 percent and Nasdaq 100 e-minis were up 1.16 percent.
The Dow Jones Industrial Average is off 18.9 percent from its closing high, while the Nasdaq is pushing deeper into bear market with each day’s declines.
The partial shutdown of the U.S. federal government, one of the recent issues that has unnerved investors, entered the fifth day. President Donald Trump said on Tuesday that the shutdown will last until his demand for funds to build a wall on the U.S.-Mexico border is met.
The political impasse over the funding bill and the recent unexpected departure of the U.S. defense chief have added to investor worries that include U.S.-China trade tensions and other geopolitical events crimping global growth and corporate profit.
“The ‘Bear Grip’ is feeding on itself as Trump continues to spread uneasiness,” said Peter Cardillo, chief market economist at Spartan Capital Securities in New York.
“We expect a relief rally that may continue for a few days as end of the quarter window dressing ups the chances of bargain hunting.”
Trump has said the Fed is the “only problem” for the U.S. economy, repeatedly criticizing the central bank for raising interest rates. He hit out at the Fed again on Tuesday, but expressed confidence in Treasury Secretary Steven Mnuchin.
Mnuchin on Monday held a call with U.S. regulators to discuss plunging U.S. stock markets. The call did more to rattle markets than to assure them and all three major U.S. stock indexes ended down more than 2 percent on the day.
That pushed all the 11 major S&P sectors into the red for the year, while roughly three-fourths of the S&P 500 stocks are trading in bear market territory.
The S&P and the Dow have fallen about 12 percent for the year, while the Nasdaq has shed 10 percent, with just four more trading sessions left to wrap up the year.