Directional Bias For The Day:
- S&P Futures are higher
- The odds are for an up day with good chance of sideways move from pre-open levels near 3165.00; elevated volatility – watch for break below 3157.75 for change of sentiments
- Key economic data due:
- Final Services PMI (47.0 est.; prev. 46.7) at 9:45 AM
- ISM Non Manufacturing PMI ( 50.0 est.; prev. 45.4) at 10:00 AM
Directional Bias Before Open:
- Critical support levels for S&P 500 are 3124.52, 3114.61 and 3101.27
- Critical resistance levels for S&P 500 are 3181.49, 3189.64 and 3213.79
- Key levels for E-mini futures: break above 3172.75, the high of 6:00 AM and break below 3157.75, the low of 5:00 AM
- On Thursday at 4:00 PM, S&P futures (September 2020) closed at 3121.50 and the index closed at 3130.01 – a spread of about -8.50 points; futures closed at 3129.00 for the day; the fair value is +2.50
- Pre-NYSE session open, futures are higher – at 9:15 AM, S&P 500 futures were up by +37.75; Dow by +364 and NASDAQ by +120.75
Markets Around The World
- Markets in East closed mostly higher – Sydney was down
- European markets are higher
- Dollar index
- Crude Oil
- 10-yrs yield closed at 0.701%, up from July 2 close of 0.669%;
- 30-years is at 1.466% up from 1.429%
- 2-years yield is at 0.157% up from 0.156%
- The 10-Year-&-2-Year spread is at 0.544 up from 0.513
- Is at 27.41; down -0.2 from July 2 close; below 5-day SMA;
- Recent high 44.44 on June 15; 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)||
For the week, U.S. indices closed higher higher in lower volume. Europe was up and most markets in Asia closed higher. Japan was down. All S&P sectors closed up. US Dollar and Japanese yen closed lower for the week. Crude Oil, gold and most commodities closed up. US Treasry yields were up for the week.
The S&P 500 increased 0.5% on Thursday amid positive labor market data, although it was up as much as 1.6% in early action. The Nasdaq Composite (+0.5%), Dow Jones Industrial Average (+0.4%), and Russell 2000 (+0.3%) also finished near session lows, but the Nasdaq did notch another record close. […]
Every sector in the S&P 500 was on pace to close in positive territory following the data, but a late fade in the market took several sectors into the red. The cyclical materials (+1.9%), energy (+1.1%), and industrials (+0.8%) sectors set the performance pace, while the real estate (-0.3%) and communication services (-0.1%) sectors closed lower.[…]
U.S. Treasuries finished little changed. The 2-yr yield declined one basis point to 0.15%, and the 10-yr yield was unchanged at 0.68%. The U.S. Dollar Index was also little changed at 97.22. WTI crude rose 1.7%, or $0.66, to $40.42/bbl.[…]
- June nonfarm payrolls increased by 4.800 million (Briefing.com consensus 3.50 million). June private sector payrolls increased by 4.767 million (Briefing.com consensus 3.00 million). June unemployment rate was 11.1% (Briefing.com consensus 12.6%), versus 13.3% in May. June average hourly earnings declined 1.2% (Briefing.com consensus -1.0%) versus a 1.0% decline in May.
- The key takeaway from the report as far as the market is concerned is that it reflects an economy that is bouncing back from the depths of the COVID-19 shutdown period. There are still far too many people unemployed (17.750 million), yet the June numbers are moving in the right direction.
- Initial jobless claims for the week ending June 27 decreased by 55,000 to 1.427 million (Briefing.com consensus 1.355 million).
- The key takeaway from the report is that initial claims remain at an alarmingly high level and will continue to be a drag on economic activity.
- The Trade Balance report for May showed a widening in the deficit to -$54.6 billion (Briefing.com consensus -$53.0 billion) from a downwardly revised $49.8 billion (from -$49.4 billion).
- The key takeaway from the report is that exports (-$6.6 billion) and imports (-$1.8 billion) both declined in May, underscoring the adverse impact of the coronavirus on the global economy.
- New orders for manufactured goods increased 8.0% m/m in May (Briefing.com consensus 7.2%) following a downwardly revised 13.5% decline (from -13.0%) in April.
- The key takeaway from the report is that it reflects a recovery in new order activity following the depths of the COVID-19 shutdown period.