Dollar Index trades below 99.00 as S&P 500 futures rise

• Dollar index suffers losses as Asian stocks and US index futures report gains. 
• Risk sentiment strengthens despite lingering US-China tensions.
• Traders to keep an eye on the US weekly jobless claims figure. 

The dollar index (DXY), which tracks greenback's value against majors, is losing altitude in Asia with the US stock futures pointing to an extension of Wednesday's risk-on rally. 

At press time, the index is hovering near 98.87, representing a 0.10% decline on the day, having closed below the 100-day simple moving average (SMA) on Wednesday. The SMA is currently lined up at 99.02. 

The uptick in the US stock futures and Asian shares is likely weighing over the safe-haven US dollar. As of writing, the futures tied to the S&P 500 are pointing to a positive open on Wednesday with 0.42% gains. The index rallied by over 2% and closed above 3,000 on Wednesday. 

Asian stocks, too, are gaining ground with Australia's S&P/ASX 200 leading the pack with 2.2% gains on the day. The risk sentiment remains strong despite the escalating tensions between the US and China, possibly due to optimism about the reopening of the US economy. 

The optimism, however, may fade if the weekly US jobless claims figure blows past expectations, renewing concerns about the health of the US labor market. The Initial Jobless Claims are forecasted to have risen by 2.05 million in the week ended May 23, having risen by 2.44 million in the preceding week. Some 38.6 million Americans have filed for jobless claims since the beginning of the coronavirus crisis. That is the largest loss in US history. 

Also, analysts are keeping an eye on the US-China tussle. Washington warned earlier this week that it would impose sanctions on China if Beijing passes the controversial Hong Kong national security bill. 

Technical levels