Directional Bias For The Day:
- S&P Futures are higher very volatile; daily bias is down;
- The odds are for an up day with elevated volatility; watch for break below 3066.00 for change of fortune
- No key economic data due:
Directional Bias Before Open:
- Critical support levels for S&P 500 are 3052.07, 3033.44 and 2992.00
- Critical resistance levels for S&P 500 are 3096.79, 3135.50 and 3182.51
- Key levels for eMini futures: break above 3096.75, the high of 7:30 AM and break below 3066.00, the low of 8:00 AM
- On Monday, at 4:00 PM, S&P future (March 2020) closed at 3089.50 and the index closed at 3090.23 – a spread of about -0.75 points; futures closed at 3065.00 for the day; the fair value is +24.50
- Pre-NYSE session open, futures are higher – at 9:15 AM, S&P 500 futures were up by +21.00; Dow by +224 and NASDAQ by +87.25
Markets Around The World
- Markets in the East closed mostly higher – Hong Kong and Tokyo were down
- European markets are higher
- Dollar index
- Crude Oil
- 10-yrs yield closed at 1.088%, down from February 28 close of 1.127%;
- 30-years is at 1.646%, down from 1.671%
- 2-years yield is at 0.911% down from 0.926%
- The 10-Year-&-2-Year spread is at 0.177 down from 0.201
- Is at 33.32 down from March 2 close; below 5-day SMA;
- At highest levels since February 2018; Next high resistance is 49.48, the high of February 28; the low support is the upper high of the gap at 22.00, the low on February 24
The trend and patterns on various time frames for S&P 500:
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|30-Minute (e-mini future)||
|15-Minute (e-mini future)||
Major U.S. indices closed higher on Monday, March 2 in volume lower than that on Friday. Indices gapped up at the open and though they bridged the gap, they closed much higher. They formed three-day morning star pattern. All S&P sectors closed up for the day.
The major averages surged on Monday with the S&P 500 (+4.6%) recording its first gain since February 19 while the Dow Jones Industrial Average (+5.1%) outperformed.[…]
All eleven sectors finished the day in positive territory with nine groups climbing at least 3.0%. Countercyclical sectors like utilities (+5.9%), consumer staples (+5.5%), and real estate (+5.1%) outperformed throughout the day while the top-weighted technology sector (+5.7%) also made a significant contribution to the Monday advance.[…]
Reviewing today’s economic data:
• The ISM Manufacturing Index for February managed to eke out an expansion reading at 50.1 (Briefing.com consensus 50.5), but that was weaker than expected and down from 50.9 in January. The dividing line between growth and contraction is 50.0.
o The key takeaway from the report is that there were noted concerns in respondents’ commentary about the negative impact of the coronavirus, which is telling because the virus has continued to spread globally since the report was compiled, implying there is an increased risk of the index falling below 50.0 in March.
• Total construction spending increased 1.8% m/m in January (Briefing.com consensus +0.7%) on the heels of an upwardly revised 0.2% increase (from -0.2%) in December. Residential spending was up 2.0% m/m and nonresidential spending was up 1.6% m/m.
o The key takeaway from the report is that January marked the largest m/m increase in construction spending since February 2018, bolstered by continued strength in residential spending.