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Sizing Up the S&P 500
- S&P 500 rebounds from mid-May weekly support.
- Current bounce may lead to August low or falling trendline.
- Several potential levels at play in difficult range-bound environment.
- 1-2 weeks of consolidation may be needed to break intermediate-term downtrend.
- 10-year Treasury yield may provide clues on market direction.
Key News
- Fed makes little changes in latest meeting.
- Treasury to increase the size of long-bond auctions slightly less than expected.
- ADP private sector payrolls grow less than expected, wage increases (changers and stayers) at 2-year lows.
- October ISM manufacturing misses as orders, employment fall.
- EIA crude oil inventories rise less than feared. Reuters says refiners are worried about lower gasoline demand.
- Consumer confidence beat estimates in October for the 1st time since July. Respondents more optimistic about selves than others.
- Consumer sentiment was also unexpectedly revised up.
- August Case Shiller home price index rises 1% vs 0.7% estimate.
- Tom Lee of Fundstrat: Stocks could break “doom loop.”
- Odds of 12/13 rate hike drop from 29% to 22.5% after Fed meeting.
- Reuters: INTC, AMD results suggest PC market is recovering
- Echoes 10/9 report by Gartner
- Jeffrey Gundlach of DoubleLine Capital sees rates falling as economy slows
Sector Watch
- REITs rebound, following utility bounce, amid hopes that yields have peaked
- Homebuilders trying to bounce as yields inch lower
- Latin American stocks trying to stabilize after August declines
- Energy continues to lag
- Precious metals weak despite lower rates. Less fear?
Signals Scan
- Lululemon Athletica (LULU) holds 50-day MA
- Palo Alto Networks (PANW) holds 50-day MA
- Dell Technologies (DELL) holds 50-day MA
- Occidental Petroleum (OXY) potentially breaking 200-day MA
- Coca Cola (KO) hits falling 50-day MA
- Will crude oil futures (@CL) make a lower low after 10/20 lower high?
Mover of the Week: Deckers Outdoor
- Maker of UGG, Teva footwear
- Benefiting from direct-to-consumer model after embracing Google Marketing Platform
- Jumped to new record high after earnings, sales and guidance beat estimates on 10/26
- DECK +49% YTD
Upcoming Events
- Earnings tonight: AAPL, MNST, FTNT
- Tomorrow (11/3): Non-farm payrolls
- Next week: Fedspeak resumes
- Wednesday (11/8): Crude oil inventories
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