Directional Bias For The Day:
- S&P Futures are higher
- The odds are for an up day with elevated volatility – watch for break below 3048.25 for change of sentiments
- Key economic data due:
- Import Prices (1.0% vs. 0.6% est.; prev. -2.6%) at 8:30 AM
- Prelim UoM Consumer Sentiment ( 7.00 est.; prev. 72.3) at 10:00 AM
- Prelim UoM Inflation Expectations ( prev. 3.2%) at 10:00 AM
Directional Bias Before Open:
- Critical support levels for S&P 500 are 3023.93, 2999.49 and 2969.75
- Critical resistance levels for S&P 500 are 3090.41, 3123.53 and 3130.94
- Key levels for E-mini futures: break above 3081.25, the higher of 11:00 AM on Thursday and break below 3048.50, the low of 3:00 AM
- On Thursday at 4:00 PM, S&P futures (June 2020) closed at 3003.50 and the index closed at 3002.10. – a spread of about +1.50 points; futures closed at 3010.25 for the day; the fair value is -6.75
- Pre-NYSE session open, futures are higher – at 9:00 AM, S&P 500 futures were up by +53.25; Dow by +487 and NASDAQ by +145.00
Markets Around The World
- Markets in the East closed mostly lower – Mumbai was up
- European markets are higher
- Dollar index
- Crude Oil
- 10-yrs yield is at 0.700%, up from June 11 close of 0.653%;
- 30-years is at 1.457%, up from 1.401%
- 2-years yield is at 0.193% down from 0.201%
- The 10-Year-&-2-Year spread is at 0.509 up from 0.452
- Is at 37.62; down -3.17 from June 11 close; above 5-day SMA;
- Recent high 39.28 on May 14; low 23.54 on June 5
- Sentiment: Risk-Neutral
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)||
Major U.S. indices closed sharply lower on Thursday, June 11 in mostly higher volume. Dow Jones Transportation Average traded in lower volume. Indices opened down with a gap and then traded lower, closing mostly near day’s lows.
The S&P 500 dropped 5.9% on Thursday, pulling back noticeably from an overheated market condition. The Dow Jones Industrial Average (-6.9%) and Russell 2000 (-7.6%) underperformed the benchmark index, while the Nasdaq Composite declined 5.3%.[…]
Energy stocks were additionally burdened by the 8% drop in oil prices ($36.41/bbl, -3.13, -7.9%), while those in the financials sector (-8.2%) were pressured by some curve-flattening activity.[…]
The 2-yr yield declined one basis point to 0.16%, while the 10-yr yield declined ten basis points to 0.65% as investors sought some safety in longer-dated maturities. The U.S. Dollar Index rose 0.8% to 96.76.[…]
• Initial jobless claims for the week ending June 6 decreased by 355,000 to a still-high 1.542 million (Briefing.com consensus 1.525 million) while continuing claims for the week ending May 30 decreased by 339,000 to a still stunningly high 20.929 million.
o The key takeaway from this report is that, notwithstanding the hiring activity in May, it shows the labor market remains a long, long way from being back.
• The Producer Price Index for final demand increased 0.4% m/m in May (Briefing.com consensus +0.1%). The index for final demand, excluding food and energy, declined 0.1% (Briefing.com consensus 0.0%). Those readings left the yr/yr rates at -0.8% and 0.3%, respectively.
o The key takeaway from this report is that it shows why the Fed isn’t thinking about raising rates anytime soon.