Directional Bias For The Day:
- S&P Futures are little changed; moving sideways since NYSE close on Wednesday
- Odds are for a sideways day – watch for break below 2883.00 and break below 2874.00 for clarity
- Key economic data due:
- Unemployment Claims ( est. 215K; prev. 211K) at 8:30 AM
Markets Around The World
- Markets in the East closed mixed – Shanghai, Tokyo, Seoul and Singapore closed higher; Hong Kong, Sydney and Mumbai closed lower
- European markets are mostly down – Germany and Spain are up
- Dollar index
- Crude Oil
- 10-yrs yield closed at 2.517%, up from April 2 close of 2.481%;
- 30-years is at 2.929%, up from 2.888%
- 2-years yield is at 2.339%, up from 2.306%
- The 10-Year-&-2-Year spread is at 0.178, up from 0.175
- Critical support levels for S&P 500 are 2865.17, 2858.75 and 2848.63
- Critical resistance levels for S&P 500 are 2880.69, 2886.02 and 2904.47
- Key levels for eMini futures: break above 2883.00, the high of 9:30 PM on Wednesday and break below 2874.00, the low of 4:30 AM
- On Wednesday, at 4:00 PM, S&P future (June contract) closed at 2876.50 and the index closed at 2873.40 – a spread of about +3.00 points; futures closed at 2879.75 for the day; the fair value is -3.25
- Pre-NYSE session open, futures are little changed – at 7:00 AM, S&P 500 futures were down by -0.75; Dow up by +2 and NASDAQ down by -5.00
Directional Bias Before Open
- Weekly: Uptrend
- Daily: Uptrend
- 120-Min: Up-Side
- 30-Min: Side
- 15-Min: Side
- 6-Min: Side
The trend and patterns on various time frames for S&P 500:
|2-Hour (e-mini future)||
|30-Minute (e-mini future)||
|15-Minute (e-mini future)||
Major U.S. indices closed higher on Wednesday, April 3 in mostly higher volume. Dow Jones Transportation Average traded in lower volume. The day’s price action was range bound and indecisive. Most indices made doji and harami like candles.
The S&P 500 advanced as much as 0.6% on Wednesday amid optimism about a U.S.-China trade deal and positive PMI non-manufacturing data out of China and Europe. The benchmark index fell into negative territory in afternoon action, however, succumbing to some selling interest after coming within 50 points of its all-time high. The S&P 500 managed to finish higher by 0.2%.
The Nasdaq Composite gained 0.6%, propped up by many components within the Philadelphia Semiconductor Index (+2.3%), which rallied on some positive industry indications. The Dow Jones Industrial Average gained 0.2%, and the Russell 2000 gained 0.5%.
The S&P 500 materials (+1.3%), information technology (+0.8%), and consumer discretionary (+0.7%) sectors outperformed the broader market. Conversely, the energy (-1.0%), consumer staples (-0.6%), and industrial (-0.3%) sectors underperformed.
U.S. Treasuries closed on a lower note, pushing yields higher in a curve-steepening trade. The 2-yr yield increased one basis point to 2.32%, and the 10-yr yield increased four basis points to 2.52%. The U.S. Dollar Index declined 0.3% to 97.11. WTI crude lost 0.3% to $62.42/bbl.
• The ISM Non-Manufacturing Index (NMI) for March dropped to 56.1% (Briefing.com consensus 57.9%) from 59.7% for February. The dividing line between expansion and contraction is 50.0%. The March reading is the lowest level for the index since December 2017.
o The key takeaway from the report is that every index component was at 50.0% or higher in March. The drop in March, then, suggests non-manufacturing sector activity increased, only at a slower pace than the prior month.
• ADP Employment Change report for March showed an estimated 129,000 positions were added to private-sector payrolls (Briefing.com consensus 178,000) following an upwardly revised 197,000 (from 183,000) for February.
• The weekly MBA Mortgage Applications Index surged 18.6% following an 8.9% increase in the prior week.
- S&P 500 Sectors
|Sector||Relative Strength (Last Month – March)||Relative Strength (April)||%K vs. %D (April)|
|Consumer Discretionary||XLY (Cross-Over)||XLY||Above|
|Consumer Staples||XLP (Cross-Over)||SPY (Cross-Under)||Below|
|Utility||XLU (Cross-Over)||SPY (Cross-Under)||Below|
|Real Estate||XLRE (Cross-Over)||XLRE||Above|