S&P 500 DRAGGED LOWER BY TECH, PAYROLLS DISAPPOINT
S&P 500 futures are currently trading at 2677- lower by 0.64% as compared to the previous close. The index futures closed in Positive territory in the last trading session. Further back, the benchmark futures closed in the red in 3 out of the last 7 trading sessions.
Stock index futures pared earlier losses on Friday after the release of weaker-than-expected employment data which eased some concerns about the Federal Reserve’s pace of rate increases.
The U.S. economy added 155K jobs in November. The markets had expected an addition of 200K jobs in the economy for the month.
In the cash markets, S&P 500 was down 0.57% at the time of writing. In weekly terms, the benchmark was down 2.3% through Thursday’s close. The index’s 50-day MA (2759.28) has crossed the 200-day MA (2762.02) to the downside for the first time since April 22, 2016 on Friday.
Friday’s moves come after equities rebounded from sharp losses on the previous day on reports that the Federal Reserve could tighten monetary policy at a slower-than-expected pace. The Wall Street Journal reported that the central bank is considering whether to signal a wait-and-see approach to rate hikes at its meeting on 18th-19th of December.
Facebook, Amazon, Netflix and Google-parent Alphabet all traded lower on Friday morning. Apple fell 1.5% after Morgan Stanley cut its price target on the tech giant’s shares, citing weakening iPhone sales. Index- member Ulta Beauty was down 8.2% after a Thursday evening earnings release that predicted weaker holiday sales than the market expectation.
On the other hand, Index-member Broadcom was up 4.2% after the chip-maker announced its fiscal fourth-quarter profits and sales on Thursday evening that topped market expectations. Altria Group was up 2.6% after the company announced it would take a 45% ownership stake in the cannabis-firm Cronos Group worth $1.8 billion.
On the technical front, the RSI is currently at 43.89% and suggests that the market can move in the downward direction. The current price is below the MA5 (2703.5). The %K has crossed the %D from above to the downside at around 92% and suggests that the market may head downwards.
Overall Bias is Negative and Short-term trades can be initiated with tight Stop Loss and Take Profit targets.
Trade Suggestion-Limit Sell At 2780, Take Profit At 2750 Stop Loss At 2895