Directional Bias For The Day:
- S&P Futures are little changed to lower;
- The odds are for a sideways to an up day – watch for break below 3275.75 for change of fortune
- Key economic data due:
- CPI ( 0.2% vs. 0.2% est.; prev. 0.3%) at 8:30 AM
- Core CPI (0.1% vs. 0.2% est.; prev. 0.2%) at 8:30 AM
Directional Bias Before Open:
- Critical support levels for S&P 500 are 3280.01, 3268.43 and 3260.86
- Critical resistance levels for S&P 500 are 3294.70, 3301.26 and 3314.40
- Key levels for eMini futures: break above 3292.50, the high of 4:30 AM and break below 3275.25, the low of 3:00 AM
- On Monday, at 4:00 PM, S&P future (March 2020) closed at 3288.50 and the index closed at 3288.13 – a spread of about +0.25 points; futures closed at 3289.75 for the day; the fair value is -0.50
- Pre-NYSE session open, futures are lower to little changed – at 8:15 AM, S&P 500 futures were down by -3.75; Dow by -9 and NASDAQ by -9.00
Markets Around The World
- Markets in the East closed mostly up – Shanghai and Hong Kong were down;
- European markets are mostly down – U.K. and STOXX 600 are higher
- Dollar index
- Crude Oil
- 10-yrs yield closed at 1.848%, up from January 10 close of 1.825%;
- 30-years is at 2.307%, up from 2.284%
- 2-years yield is at 1.592%, up from 1.576%
- The 10-Year-&-2-Year spread is at 0.256 up from 0.249
- Is at 12.53 up from January 13 close of 12.32; below 5-day SMA
- Recent high was 16.39 on January 6; recent low was 11.72 on December 26
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 higher on Monday, January 13 in mostly higher volume. S&P 500 traded in lower volume. Major indices mostly recovered the losses suffered on Friday. Dow Jnes Industrial Average was an exception.
The S&P 500 (+0.7%) and Nasdaq Composite (+1.0%) closed at record highs on Monday in a continuation trade of the market’s bullish momentum. The Dow Jones Industrial Average increased 0.3%, and the Russell 2000 increased 0.7%.
In turn, ten of the 11 S&P 500 sectors pushed higher, with leadership coming from the materials (+1.4%), information technology (+1.3%), and real estate (+1.2%) sectors. Apple (AAPL 316.96, +6.63, +2.1%) remained an influential force after its price target was raised to $375 from $300 at D.A. Davidson.
The health care sector (-0.4%) was the lone holdout amid disappointing guidance from Abiomed (ABMD 168.10, -20.96, -11.1%), weakness in the insurance stocks after Senator Bernie Sanders (I-VT) took the lead in the latest poll in Iowa, and a relatively quiet first day at the JPMorgan Healthcare Conference.
U.S. Treasuries finished slightly lower in a tight-ranged session. The 2-yr yield and the 10-yr yield increased two basis points each to 1.58% and 1.85%, respectively. The U.S. Dollar Index finished flat at 97.36. WTI crude fell 1.5%, or $0.87, to $58.12/bbl.
Monday’s economic data was limited to the Treasury Budget for December, which showed a deficit of $13.3 billion (Briefing.com consensus -$15.0 billion) versus a deficit of $13.5 billion in the same period a year ago. The budget deficit over the last 12 months is $1.022 trillion versus $1.022 trillion in November.