S&P 500 RECOVERS AS TRADE TENSIONS EASE & TECH LEADS
S&P 500 futures are currently trading at 2770- higher by about 0.69% as compared to the previous close. The index futures have been gaining momentum since the last trading session. Further back, it has closed in the negative, in 4 out of the past 5 trading sessions. The rise in U.S. stock futures follows an uptick in global equities.
Ten of the eleven major S&P sectors were higher, led by the technology sector. The tech sector surged 2.5% in the morning. Stocks gained as worries over rising rates subsided.
Among index constituents, J.P. Morgan Chase, Citigroup, and Wells Fargo all trading in positive territory after reporting stronger-than-expected third-quarter results.
Netflix was up 5.7% after Citigroup recommended buying Netflix’s shares, saying the recent sell-off was overdone.
The financial sector rose 1.9% overall basis in the current trading session. So far this year it has struggled, falling 3.7% year-to-date, compared with the 3.5% rise of the S&P 500.
White House economic advisor Larry Kudlow told CNBC on Thursday “there’s some movement” toward a meeting between President Trump and the Chinese President in Argentina at the G-20 summit in November, though the talks and topics to be addressed by the two leaders have not “been set in concrete.” The news eased trade tensions between the US and China and also reduced global concerns.
Top gainers in the S&P 500 include Autodesk (up 5.8%), NVIDIA (up 5.2%), Visa (up 4.2%) and Salesforce (up 5%) at the time of writing.
Earnings at S&P 500 companies are estimated to have risen 21.3% in the third quarter, according to I/B/E/S data from Refinitiv. This rate of earning growth represents a slowdown from the previous two quarters.
On the technical front, the RSI is currently at 20.72% and suggests that the market can move in the upward direction. The current price is below the MA5. The current price is below the lower band of the Bollinger Bands but is heading upwards.
Overall Bias is Positive and Short-term trades can be initiated with tight Stop Loss and Take Profit targets. This trade can remain valid until Monday.
Trade Suggestion-Limit Buy At 2760, Take Profit At 2790 Stop Loss At 2745