Directional Bias For The Day:
- S&P Futures are lower; moving higher since 4:30 AM
- Odds are for a down day with choppiness and elevated volatility – watch for break above 2631.00 for change of fortune
- Key economic data due:
- Core Retail Sales (0.2% vs. 0.2% est. and 1.0% prev.) at 8:30 AM
- Retail Sales (0.2% vs. 0.1% est. and 1.1% prev.) at 8:30 AM
Markets Around The World
- Markets in the East closed mostly lower – Mumbai closed up
- European markets are lower
- Dollar index
- Crude Oil
- 10-yrs yield is at 2.892%, down from December 13 close of 2.914%;
- 30-years is at 3.147%, down from 3.170%
- 2-years yield is at 2.745%, up from 2.757%
- The 10-Year-&-2-Year spread is at 0.147, up from 0.133
- Critical support levels for S&P 500 are 2637.27, 2621.3 and 2614.86
- Critical resistance levels for S&P 500 are 2655.51, 2670.19 and 2685.44
- Key levels for eMini futures: break above 2625.75 the high of 6:30 AM and break below 2613.50, the low of 4:30 AM
- On Thursday, at 4:00 PM, S&P future (December contract) closed at 2649.50 and the index closed at 2650.54 – a spread of about +1.00 points; futures closed at 2645.50 for the day; the fair value is +4.00
- Pre-NYSE session open, futures price action is to the downside – at 8:30 AM, S&P 500 futures were down by -17.50; Dow by -175; and NASDAQ by -41.50
Directional Bias Before Open
- Weekly: Uptrend Under Pressure
- Daily: In Correction
- 120-Min: Side-Down
- 30-Min: Side-Down
- 15-Min: Down
- 6-Min: Down-Side
The trend and patterns on various time frames for S&P 500 are:
|2-Hour (e-mini future)||
|30-Minute (e-mini future)||
|15-Minute (e-mini future)||
Major U.S. indices closed mostly lower on Thursday December 13. The volume was mostly lower too. Dow Jones Industrial Average closed higher and Dow Jones Transportation Average traded in higher volume. Most indices closed below their open and with real body within the large real body of Tuesday.
The U.S. major indices finished mixed on Thursday, as ongoing uncertainty surrounding global issues kept many buyers on the sidelines. The S&P 500 finished flat, the Nasdaq Composite lost 0.4%, and the Dow Jones Industrial Average gained 0.3%.
In particular, the continued weakness from the Dow Jones Transportation Average (-1.6%), S&P 500 financial sector (-0.6%), and small-cap Russell 2000 (-1.6%), all of which play a key role in driving sentiment on the domestic economic outlook, and some cautious-sounding commentary on the economic outlook from European Central Bank President Draghi following today’s ECB policy meeting, subdued investor confidence.
Concerns over slowing economic growth, and its adverse effect on corporate earnings, helped contribute to investors assuming some defensive positioning within the stock market.
Separately, retail stocks were one of the hardest hit groups on Thursday, which helped drive the weakness in the consumer discretionary (-0.4%) sector. The SPDR S&P Retail ETF (XRT 42.52, -1.17) lost 2.7%.
Reviewing Thursday’s economic data, which included Export and Import Prices for November, weekly Initial and Continuing Claims, and the Treasury Budget for November:
The key takeaway from the report is that it stirred some thinking that inflation trends could be in a topping phase, which is constructive in terms of the market’s belief that the Federal Reserve is apt to take a more conservative path with future rate hikes.
- S&P 500 Sectors
|Sector||Daily Trend (Visual)||Relative Strength (Last Month – November)||Relative Strength (Current)||%K vs. %D|
|Consumer Staples||Under Pressure||XLP||XLP||Above|
|Industrials||Down||XLI (Cross – Over)||XLI||Below|
|Heath Care||Under Pressure||XLV (Cross – Over)||XLV||Cross-Under|