Directional Bias For The Day:
- S&P Futures are little changed to higher;
- Moving mostly sideways since 8:30 AM on Tuesday
- FOMC rate decision day
- The odds are for a sideways day – watch for break above 3143.50 and break below 3127.50 for clarity
- Key economic data due:
- CPI ( 0.3% vs. 0.2% est. ; prev. 0.4%) at 8:30 AM
- Core CPI (0.2% vs. 0.2% est. ; prev., 0.2%) at 8:30 AM
- FOMC Statement and Funds Rat at 2:00 PM
- FOMC Press Conference at 2:30 PM
Directional Bias Before Open:
- Critical support levels for S&P 500 are 3127.78, 3124.90 and 3117.43
- Critical resistance levels for S&P 500 are 3142.12, 3150.37 and 3154.26
- Key levels for eMini futures: break above 3143.50, the high of 3:00 AM and break below 3127.75, the low of 3:30 PM on Tuesday
- On Tuesday, at 4:00 PM, S&P future closed at 3132.75 and the index closed at 3132.52 – a spread of about +0.25 points; futures closed at 3136.00 for the day; the fair value is -3.25
- Pre-NYSE session open, futures are mixed – at 8:15 AM, S&P 500 futures were up by +3.00; Dow down by -34 and NASDAQ up by +17.50
Markets Around The World
- Markets in the East closed mostly higher – Tokyo was down
- European markets are mostly higher – U.K. and Switzerland are lower
- Dollar index
- Crude Oil
- 10-yrs yield closed at 1.833%, up from December 9 close of 1.829%;
- 30-years is at 2.253%, down from 2.264%
- 2-years yield is at 1.654%, up from 1.621%
- The 10-Year-&-2-Year spread is at 0.179 down from 0.208
- Is at 15.59 down from December 10 close of 15.68; above 5-day SMA
- Recent high was 17.99 on December 3; recent low was 12.25 on December 9
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 mostly lower on Tuesday, December 10 in mostly higher volume. Russell 2000 closed up and Dow Jones Industrial Average traded in lower volume. Indices opened to the down side after futures had risen in pre-open trading. Indices made day’s low in first half hour of trading before rising and making the day’s high before noon. Then they mostly traded down and closed near mid-range before testing the lows again.
The S&P 500 declined 0.1% on Tuesday in a tight-ranged session, as investors digested several developments on trade, including a report that the U.S. and China could delay the Dec. 15 tariffs. The Dow Jones Industrial Average (-0.1%) and Nasdaq Composite (-0.1%) also lost 0.1%, while Russell 2000 (+0.1%) added 0.1%.
Most S&P 500 sectors wavered near their unchanged marks throughout the session. The real estate (-0.7%) and materials (-0.6%) sectors diverted with relatively larger declines, while the energy (+0.2%) and health care (+0.2%) sectors finished higher.
U.S. Treasuries finished the session mixed. The 2-yr yield increased three basis points to 1.65%, and the 10-yr yield was unchanged at 1.83%. The U.S. Dollar Index declined 0.2% to 97.45. WTI crude increased 0.4%, or $0.24, to $59.21/bbl.
• Nonfarm business sector labor productivity decreased 0.2% in the third quarter (Briefing.com consensus -0.1%), according to the revised estimate, versus a previously reported 0.3% decrease. Unit labor costs increased 2.5% (Briefing.com consensus 3.4%) versus a previously reported 3.6% increase.
o The key takeaway from the report remains the same as the preliminary estimate: the decline in productivity and the jump in unit labor costs points to profit margin pressures for businesses.
• The NFIB Small Business Optimism Index for November increased to 104.7 from 102.4 in October.