Directional Bias For The Day:
- S&P Futures are lower; broke below an upsloping wedge on 30-minute chart at 6:30 AM
- The odds are for a down day with good chance of sideways to up move from pre-open level near 2812.00; elevated volatility – watch for break above 2841.00 for change of fortune
- Key economic data due:
- Retail Sales ( 16.4% vs. 12.0% est.; prev. -8.3%) at 8:30 AM
- Core Retail Sales ( -17.2% vs. -8.6% est.; prev. -4.0%) at 8:30 AM
- Empire State Manufacturing Index ( -48.5 vs. -65.0; prev. -78.2) at 8:30
- Capacity Utilization ( 63.9% est.; prev. 72.7%) at 9:15 AM
- Industrial Production ( -11.3% est.; prev. -5.4%) at 9:15 AM
- Prelim UoM Consumer Sentiment ( 68.0est.; prev. 71.8) at 10:00 AM
Directional Bias Before Open:
- Critical support levels for S&P 500 are 2813.55, 2793.38 and 2766.64
- Critical resistance levels for S&P 500 are 2852.80, 2874.14 and 2902.15
- Key levels for E-mini futures: break above 2841.00, the high of 6:30 AM and break below 2786.25, the low of 11:30 AM on Thursday
- On Thursday at 4:00 PM, S&P futures (June 2020) closed at 2846.75 and the index closed at 2852.50 – a spread of about -5.75 points; futures closed at 2847.00 for the day; the fair value is -0.25
- Pre-NYSE session open, futures are lower – at 8:45 AM, S&P 500 futures were down by -28.00; Dow by -210 and NASDAQ up -131.25
Markets Around The World
- Markets in the East closed mixed – Shanghai, Hong Kong and Mumbai were down; Tokyo, Sydney, Seoul and Singapore were up
- European markets are mixed – Germany, U.K., Italy, Switzerland and STOXX 600 are up; France and Spain are down
- Dollar index
- Crude Oil
- 10-yrs yield is at 0.598%, down from May 14 close of 0.619%;
- 30-years is at 1.263%, down from 1.296%
- 2-years yield is at 0.133% down from 0.149%
- The 10-Year-&-2-Year spread is at 0.465 down from 0.470
- Is at 34.74; up +2.14 from May 14 close; above 5-day SMA;
- Down from all time high of 85.47 on March 18; recent high 47.77 on April 21, recent low 30.54 on April 28
- Sentiment: Risk-Off
The trend and patterns on various time frames for S&P 500:
|2-Hour (E-mini futures)||
|30-Minute (E-mini futures)||
|15-Minute (E-mini futures)||
Indices opened lower making day’s low by mid-morning and then mostly traded higher closing near the highs. Most made Piercing candlestick formation.
The S&P 500 advanced 1.2% on Thursday in a turnaround trade led by the beaten-up financials sector. The benchmark index was down as much as 1.9% in early action following a relatively disappointing weekly jobless claims report.
The Dow Jones Industrial Average increased 1.6%, and the Nasdaq Composite increased 0.9%. The Russell 2000 underperformed with a 0.4% gain.[…]
The S&P 500 financials sector (+2.6%) set the rebound pace amid strength in the bank stocks, including Wells Fargo (WFC 24.06, +1.53, +6.8%) amid speculation that it could merge with Goldman Sachs (GS 174.45, +2.65, +1.5%). The consumer staples sector (-0.3%) was the only sector without a gain today.[…]
U.S. Treasuries finished mixed and little changed. The 2-yr yield increased one basis point to 0.16%, while the 10-yr yield declined two basis points to 0.63%. The U.S. Dollar Index increased 0.1% to 100.31.[…]
• Total jobless claims for the week ending May 9 were 2,981,000 (Briefing.com consensus 2.475 million). That was a decrease of 195,000 from the prior week, but still an exceedingly high number all things considered. Continuing claims for the week ending May 2 increased by 456,000 to 22.833 million, which is yet another record high.
o The key takeaway from the report is that the alarmingly high level of initial and continuing claims paints a risk of a slower recovery due to weaker consumer spending activity and the rising potential that temporary job losses become permanent job losses in an elongated recovery process.
• Import prices declined 2.6% in April, and prices, excluding oil, declined 0.5%. Export prices declined 3.3% in April, and prices, excluding agriculture, also declined 3.3%.