Markets Rally Behind Latest Moves From D.C. and Positive Earnings
Markets again in green
Major U.S. indices and futures are in the green today after a turbulent start to the week that featured tariff and global trade uncertainty.
Cisco and Walmart report positive earnings
Today’s big-name earnings beat returned positive with Cisco and Walmart reporting before the market opened to better than expected results while U.S. housing and labor data also returned positively.
Nvidia, Applied Materials, and Pinterest earnings after market close
Look for Nvidia, Applied Materials, and Pinterest earnings after the market closes today, Deere earnings and consumer sentiment index tomorrow.
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Market above its 50-days moving average
The market is currently trading above its 50-days moving average for the SPY, $286, after closing below it earlier in the week. If the market can close above 50-days moving average for a few days look for market bulls to lead.
Consider buying market near $280
We expect the market to continue trading between $280-$294 for the SPY and encourage our readers to consider buying market near $280. Avoid chasing the market near $290. However, if further tariffs are imposed, we expect more volatility and the market to break its 200-day moving average on SPY. For reference, the SPY Seasonal Chart is shown below:
Walmart and Cisco Systems topped expectations
Today’s two major earnings releases, both components of the Dow, helped support markets to early gains as Walmart and Cisco Systems topped expectations. Walmart saw shares rise over 2% behind earnings that saw a spike in sales while Cisco shares are currently up 7% with a strong revenue forecast.
Current earnings season showed promise for the economy
With most corporate earnings having already been released, the current earnings season showed promise amidst fluctuating global and economic conditions.
Target, Home Depot, Kraft, Best Buy, and Hewlett Packard earnings next week
Next week, earnings will slow significantly with fewer major brands and corporations reporting. Some names due to release next week include Target, Home Depot, Kraft, Best Buy, and Hewlett Packard.
FOMC minutes and existing home sales next week
Notable economic reports to release next week will be headlined by FOMC minutes and existing home sales. Today, the weekly jobless claims report showed a decrease in unemployment while construction of new homes report showed a decent spike in April, rising 6% from the previous month.
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Global markets closed in the green
Global markets were also able to stabilize after a turbulent start to the week. Currently both Asian, apart from Japan, and European markets closed in the green.
Tariff wars have cooled off
Tariff escalation talks seemed to have cooled off following China’s retaliatory tariffs. Wednesday’s report the U.S. would hold off on European and Japanese car tariffs also certainly helped.
China’s Huawei Tech banned from conducting business in the U.S
Also taking place yesterday, President Trump signed an executive order banning China’s Huawei Tech from conducting business in the U.S., a move seen to protect U.S. computer and telecom companies.
Further negotiations possible at the G20 international summit next month
Further negotiations are not yet on the table but both sides are due to meet in next month’s G20 international summit taking place in Japan.
Using the “^GSPC” symbol to analyze the S&P 500, our 10-day prediction window shows negative signals. Today’s vector figure of -0.21% moves to -3.21% in five trading sessions. Prediction data is uploaded after the market close at 6 pm, CST. Today’s data is based on market signals from the previous trading session.
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Highlight of a Recent Winning Trade
On May 15th, our ActiveTrader service produced a bullish recommendation for Whirlpool Corp (WHR). ActiveTrader is included in all paid Tradespoon membership plans and is designed for day trading.
Trade Breakdown
WHR entered its forecasted Strategy A Entry 1 price range $129.06 (± 0.82) in its first hour of trading and passed through its Target price $130.35 in the second hour of trading that day. The Stop Loss price was set at $127.77.
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Friday Morning Featured Symbol
*Please note: Our featured stock is part of your free subscription service. It is not included in any paid Tradespoon subscription service. Vlad Karpel only trades his own personal money in paid subscription services. If you are a paid subscriber, please review your Premium Member Picks, ActiveTrader or MonthlyTrader recommendations. If you are interested in receiving Vlad’s personal picks, please click here.
Our featured symbol for Friday is Aflac Inc (AFL). AFL is showing a confident vector trend in our Stock Forecast Toolbox’s 10-day forecast. This stock is assigned a Model Grade of (A) indicating it ranks in the top 10th percentile for accuracy for predicted support and resistance, relative to our entire data universe.
The stock is trading at $52.13 at the time of publication, up 2.00% from the open with a +0.19% vector figure.
Prediction data is uploaded after market close at 6 p.m., CST. Today’s data is based on market signals from the previous trading session.
Note: The Vector column calculates the change of the Forecasted Average Price for the next trading session relative to the average of actual prices for the last trading session. The column shows expected average price movement “Up or Down”, in percent. Trend traders should trade along the predicted direction of the Vector. The higher the value of the Vector the higher its momentum.
Oil
West Texas Intermediate for June delivery (CLM9) is priced at $62.95 per barrel, up 1.50% from the open, at the time of publication.
Looking at USO, a crude oil tracker, our 10-day prediction model shows mixed signals. The fund is trading at $13.13 at the time of publication, up 1.00% from the open. Vector figures show -0.03% today, which turns +0.74% in five trading sessions. Prediction data is uploaded after market close at 6 p.m., CST. Today’s data is based on market signals from the previous trading session.
Gold
The price for June gold (GCM9) is down 0.86% at $1,286.60 at the time of publication.
Using SPDR GOLD TRUST (GLD) as a tracker in our Stock Forecast Tool, the 10-day prediction window shows mostly negative signals. The gold proxy is trading at $121.42, down 1.00% at the time of publication. Vector signals show +0.03% for today. Prediction data is uploaded after market close at 6 p.m., CST. Today’s data is based on market signals from the previous trading session.
Treasuries
The yield on the 10-year Treasury note is up 1.19% at 2.40% at the time of publication. The yield on the 30-year Treasury note is up 0.62% at 2.84% at the time of publication.
Using the iShares 20+ Year Treasury Bond ETF (TLT) as a proxy for bond prices in our Stock Forecast Tool, we see positive signals in our 10-day prediction window. Today’s vector of +0.04% moves to +0.54% in three sessions. Prediction data is uploaded after market close at 6 p.m., CST. Today’s data is based on market signals from the previous trading session.
Volatility
The CBOE Volatility Index (^VIX) is down 4.50% at $15.7 at the time of publication, and our 10-day prediction window shows mixed signals. The predicted close for tomorrow is $17.10 with a vector of +1.00%. Prediction data is uploaded after market close at 6 p.m., CST. Today’s data is based on market signals from the previous trading session.
