S&P 500 index: After sharp slide, seeking to stabilize
Main U.S. equity index futures ~flat
Jobless claims 235k vs 238k est
Q2 Adv GDP > est, Durable Goods < est
Euro STOXX 600 index down ~1.2%
Dollar flat; gold, crude both down >1%; bitcoin off ~3%
U.S. 10-Year Treasury yield falls to ~4.25%
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S&P 500 INDEX: AFTER SHARP SLIDE, SEEKING TO STABILIZE
On Wednesday, the S&P 500 index .SPX slid 2.32% for its biggest one-day drop since December 2022. With this, the benchmark index ended its 356-day streak without a drop of more than 2%.
That was its longest such streak since its record run of 949 days without a decline of more than 2% that ended in 2007.
The SPX, which finished at 5,427.13, is now down more than 4% in just the six trading days since both its July 16 record closing-, and record intraday-, highs of 5,667.20, and 5,669.67.
On Wednesday, the S&P 500 ended below its rising 50-day moving average (DMA), which finished at 5,428.30, for the first time since May 3:
The index closed on Wednesday just slightly above the support line from the October 2023 trough, which should be around 5,426 on Thursday, and the 38.2% Fibonacci retracement of the April - July advance which is at 5,396.
Now, in premarket trade on Thursday, e-mini S&P 500 futures ESc1 are roughly flat.
Meanwhile, the 14-day Relative Strength Index (RSI) has now fallen to 41.6. This oscillator bottomed with the late October 2023 SPX low at 29, which was just below the 30.00 oversold level. Its low print at the April 2024 trough was 31.3.
The 50% retracement of the April - July advance is at 5,311, while the rising 100-DMA, which ended at 5,285 on Wednesday, should ascend to around 5,288 on Thursday.
Of note, the 100-DMA contained the March - April 2024 decline. The S&P 500 last closed below this longer-term moving average on November 9 of last year.
A decline to the 5,311 area would put the SPX down just over 6% from its record intraday high.
The 23.6% Fibonacci retracement of the April - July advance, at 5,501, should now act as a hurdle. The SPX will need to reverse above Tuesday's 5,585.34 high to suggest potential for new highs.
(Terence Gabriel)
*****
FOR THURSDAY'S EARLIER LIVE MARKETS POSTS:
WHAT'S UP WITH THE YEN? - CLICK HERE
WHY UBS LIKES BANKS - CLICK HERE
STOXX 600 DROPS TO 12-WEEK LOW AS EARNINGS FAIL TO IMPRESS - CLICK HERE
GLOBAL EQUITY SLUMP SET TO GATHER MOMENTUM IN EUROPE - CLICK HERE
STOCK ROUT SPREADS BEYOND TECH - CLICK HERE
SPX07252024 https://tmsnrt.rs/3ycvMnx
(Terence Gabriel is a Reuters market analyst. The views expressed are his own)
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