Directional Bias For The Day:
- S&P Futures are lower; drifting sideways to lower since 1:30 PM; the upsloping flag since Friday is in danger of breaking to downside
- The odds are for a down to sideways day from pre-open levels – watch for break above 3008.25 for change of fortune
- Key economic data due:
- Flash Manufacturing PMI (est. 50.9; prev. 50.6) at 9:45 AM
- Flash Services PMI (est. 51.6; prev. 51.6) at 9:45 AM
- New Homes Index (est. 659K; prev. 626K) at 10:00 AM
Markets Around The World
- Markets in the East closed mixed – Shanghai, Hong Kong, Tokyo and Sydney closed up; Mumbai, Seoul and Singapore closed down
- European markets are mixed – Germany, Spain and Italy are up; U.K. France, Switzerland and STOXX 600 are down
- Crude Oil
- 10-yrs yield is at 2.074%, down from July 22 close of 2.043%;
- 30-years is at 2.608%, down from 2.570%
- 2-years yield is at 1.835%, down from 1.823%
- The 10-Year-&-2-Year spread is at 0.220, down from 0.222
- Critical support levels for S&P 500 are 3000.47, 2988.56 and 2982.50
- Critical resistance levels for S&P 500 are 3006.02, 3009.53 and 3017.80
- Key levels for eMini futures: break above 3008.25, the high of 11:00 PM and break below 2996.00, the low of 5:30 AM
- On Tuesday, at 4:00 PM, S&P future (June contract) closed at 3007.50 and the index closed at 3005.47 – a spread of about +2.00 points; futures closed at 3008.00 for the day; the fair value is -0.50
- Pre-NYSE session open, futures are lower – at 7:45 AM, S&P 500 futures were down by -8.25; Dow by -88 and NASDAQ by -32.75
Directional Bias Before Open
- Weekly: Uptrend resumed
- Daily: Uptrend
- 30-Min: Up
- 15-Min: Up-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)||
The S&P 500 increased 0.7% on Tuesday, bolstered by encouraging trade news and positive earnings reports from widely-held companies. The Dow Jones Industrial Average (+0.7%), Nasdaq Composite (+0.6%), and Russell 2000 (+0.7%) advanced in-line with the benchmark index.
The news pushed the S&P 500 back above the 3000 level, where it would stay above on a closing basis. Ten of the 11 S&P 500 sectors finished higher, led by the trade-sensitive materials (+2.0%) and industrials (+1.2%) sectors. The utilities sector was the lone holdout, finishing lower by 0.6%.
U.S. Treasuries finished on a lower note, pushing yields higher across the curve. The 2-yr yield increased two basis points to 1.83%, and the 10-yr yield increased three basis points to 2.07%. The U.S. Dollar Index advanced 0.5% to 97.74, helped by some weakness in the euro. WTI crude rose 0.9% to $56.72/bbl.
• Existing home sales decreased 1.7% month-over-month in June to a seasonally-adjusted annual rate of 5.27 million (Briefing.com consensus 5.30 million) from an upwardly revised 5.36 million (from 5.34 million) in May. Total sales were 2.2% lower than the same period a year ago.
o The key takeaway from the report is that the drop in mortgage rates has failed to spur a meaningful pickup in existing home sales, which continue to be constrained by the lack of available supply at lower price points.
• The FHFA Housing Price Index for May increased 0.1% after advancing 0.4% in June.